AQUA AIMS LEE CHAPEL LLP

Executive Summary

Aqua Aims Lee Chapel LLP demonstrates a strong liquidity position and improving profitability in its early years of operation, supported by timely compliance with statutory requirements. Key risks relate primarily to governance concentration and the classification of member loans alongside unsecured creditors, warranting focused due diligence. Overall, financial stability appears solid with no immediate solvency concerns.

AQUA AIMS LEE CHAPEL LLP - Analysis Report

Company Number: OC443931

Analysis Date: 2025-07-20 14:59 UTC

1. Risk Rating: LOW
   The company shows solid financial metrics for its size and stage, with positive net current assets and increasing profitability. It is compliant with filing deadlines, and no adverse regulatory or governance issues are evident.

2. Key Concerns:

• Concentration of Control: Both members hold significant control (25-50%) and rights to appoint/remove members, which may present governance risks if disputes arise.
• Member Loans Classification: The “loans and other debts due to members” are substantial (£99k) and classified alongside unsecured creditors, suggesting potential risk to outside creditors if financial distress occurs.
• Debtor Levels: Debtors represent a material portion of current assets (£41k), and while not excessive, monitoring collections is prudent given the personal tuition business model.

3. Positive Indicators:

• Profit Growth: The LLP’s profit before members’ remuneration nearly doubled from £52.6k to £98.1k within one year, indicating strong operational performance.
• Healthy Liquidity: Cash holdings of £147k and net current assets of £99k reflect good short-term liquidity to meet obligations.
• Timely Compliance: No overdue filings or penalties, and accounts are prepared under small LLPs regime with appropriate accounting policies.

4. Due Diligence Notes:

• Review the nature and terms of the loans/debts due to members, including repayment schedules and any security arrangements.
• Assess the debtor aging and credit risk to evaluate cash flow reliability.
• Confirm governance arrangements between the two designated members to understand decision-making processes and conflict resolution mechanisms.
• Verify the LLP’s business model sustainability and client retention given its personal swimming tuition activity.