AQURATE ENGINEERING(SCOTLAND) LTD

Executive Summary

AQURATE ENGINEERING(SCOTLAND) LTD presents a weak financial profile with negative net assets and substantial current liabilities exceeding current assets by a large margin. The company’s liquidity position is critical, posing significant risk for credit exposure. Credit facilities are not recommended until financial stability and improved working capital are demonstrated.

AQURATE ENGINEERING(SCOTLAND) LTD - Analysis Report

Company Number: SC761780

Analysis Date: 2025-07-20 14:47 UTC

1. Credit Opinion: DECLINE
   The company reports a significant net current liability position of £714,440 and total net liabilities of £748,363 as at 31 March 2024. This negative equity position and large current liabilities relative to current assets indicate severe financial distress and an inability to meet short-term obligations without external funding. Given the company's recent incorporation in March 2023 and its micro-entity reporting status, the financials suggest the business is either in start-up phase with high liabilities or already experiencing financial difficulties. The lack of fixed assets further limits collateral options for lending. Overall, the company’s balance sheet does not support credit extension at this stage.

2. Financial Strength:
   The balance sheet shows zero fixed assets and current assets of £82,615, but current liabilities of £820,179, resulting in a negative net working capital of £714,440. There are also provisions for liabilities (£31,439) and accruals (£2,484) worsening the position. The net assets are negative £748,363, reflecting accumulated losses or shareholder loans classified as liabilities. Shareholders funds are negative and fully attributable to the sole director/owner. This weak financial foundation implies limited financial strength and high risk of insolvency without capital injection.

3. Cash Flow Assessment:
   Current assets likely include cash and receivables, but the overwhelming current liabilities suggest severe liquidity constraints. Negative working capital means the company does not have sufficient liquid resources to cover short-term debts. With average 6 employees, operating expenses are likely ongoing, yet no fixed assets or positive equity buffer exists to support operational continuity. Immediate cash flow pressures are evident, and the company’s survival depends on additional funding or restructuring.

4. Monitoring Points:

• Monitor quarterly management accounts for cash flow improvements and reduction in current liabilities.
• Track any capital injections or shareholder loans to improve working capital.
• Watch for payment delays to suppliers or creditors as early warning signs of distress.
• Review subsequent filings for changes in net assets and profit/loss trends.
• Assess director actions regarding turnaround plans or seeking external financing.