Company Number: NI669293

Analysis Date: 2025-07-20 16:08 UTC

1. Risk Rating: MEDIUM
   The company demonstrates positive net assets and shareholder funds, indicating solvency at the balance sheet date. However, the significant deterioration in net current assets—from a positive £143 in 2023 to a negative £15,729 in 2024—raises liquidity concerns. The presence of provisions and long-term creditors further adds to financial risk. The company appears operationally active but with limited scale and a single director.

2. Key Concerns:

• Liquidity Pressure: The negative net current assets of £15,729 as of 31 May 2024 indicate that current liabilities exceed current assets, suggesting potential short-term cash flow stress.
• Director’s Advances: A notable director’s loan balance of -£23,889 (director owes the company) with significant fluctuations from the prior year could signal reliance on director financing or related party transactions that require scrutiny.
• Provisions and Long-Term Creditors: The company holds £9,501 in provisions and £10,223 in creditors due after one year, which could impact future cash outflows and financial flexibility.

3. Positive Indicators:

• Growing Net Assets: Net assets increased from £24,848 in 2023 to £28,888 in 2024, reflecting retained earnings or capital growth despite liquidity challenges.
• No Overdue Filings: The company is current with statutory accounts and confirmation statement filings, indicating regulatory compliance and good governance practices.
• Established Director Control: The sole director holds ultimate control, providing clear accountability and decision-making authority.

4. Due Diligence Notes:

• Investigate the causes and timing of the deterioration in working capital, including the composition and collectability of debtors and realizability of stocks.
• Review the nature and terms of the director’s loan advances and repayments to assess any financial dependency or related party risks.
• Assess the provisions' underlying liabilities to understand future financial commitments and their impact on cash flows.
• Confirm the absence of director disqualifications or regulatory sanctions given sole director control.
• Verify the operational sustainability given the company’s size (one employee) and the sector’s cyclical risks.