Company Number: SC779847

Analysis Date: 2025-07-29 19:49 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   AMJ CHIRO LTD is a newly incorporated private limited company operating in the specialist medical practice sector. The company has demonstrated incremental growth in current assets and net current assets over its first two full reporting years. However, the very modest absolute asset base (£4,793 current assets, £407 net assets as of March 2025) and reliance on director advances (£4,685 owed by director) indicate a fragile liquidity position. The company can meet short-term liabilities but only marginally. Given its micro size and early stage, credit exposure should be limited and closely monitored. Approval is conditional on maintaining positive cash flows, timely filing, and no material deterioration in debtor collectability or creditor obligations.

2. Financial Strength:
   The balance sheet reveals a micro-sized entity with net assets increasing from £312 to £407 over 2 years, reflecting retained earnings and modest profitability. Total assets are mainly current and primarily composed of debtors owed by the director, indicating limited external trade receivables. No fixed assets are reported. Current liabilities have increased significantly to £4,386, mostly tax and social security obligations (£3,306) and accrued liabilities (£1,080). Shareholders’ funds remain minimal, reflecting a low capitalisation level. The financial structure is weak with minimal equity buffer and substantial reliance on director funding rather than external finance or operating cash generation.

3. Cash Flow Assessment:
   Cash at bank is negligible (£108 at year end), and the company has a small positive net working capital (£407). The increase in debtors is mostly director advances rather than customer invoices, which limits cash inflow reliability. Tax liabilities have grown sharply, suggesting the company is generating taxable profits but may face cash flow strain in meeting these obligations. Liquidity is tight, and the company’s ability to service debt or unexpected expenses is limited without further director support or external funding.

4. Monitoring Points:

• Debtor collectability and turnover of director advances to ensure these are not long-term receivables impairing liquidity.
• Tax and social security payments to avoid accumulation of overdue liabilities.
• Cash balances and operating cash flows to confirm the business can fund operations independently.
• Timeliness of statutory filings and any changes in director or control to assess governance stability.
• Growth trajectory in revenues and net assets to verify sustainable business development.