ARTY SOLUTIONS LIMITED

Executive Summary

ARTY SOLUTIONS LIMITED shows a stable and improving financial position with strong liquidity and a doubling of net assets in the past year. The company demonstrates low leverage and adequate working capital, supported by director funding. Credit approval is recommended with routine monitoring on cash flow and related party transactions to maintain financial resilience.

ARTY SOLUTIONS LIMITED - Analysis Report

Company Number: SC663083

Analysis Date: 2025-07-20 15:59 UTC

1. Credit Opinion: APPROVE
   ARTY SOLUTIONS LIMITED demonstrates a stable and improving financial position with positive net current assets and net assets increasing from £6,430 in 2023 to £13,067 in 2024. The company holds a strong cash position relative to current liabilities, indicating solid liquidity and ability to meet short-term obligations. The director has provided an interest-free loan, showing management support. No adverse indicators such as overdue filings or insolvency status are present. Given the company’s micro size and limited operational history since 2020, the credit risk is low to moderate, and credit approval is justified, possibly with a modest facility size aligned to its scale.

2. Financial Strength:
   The balance sheet reflects a sound financial health for this micro entity. Shareholders’ funds have doubled in the latest year to over £13,000, backed by increasing retained earnings. Current liabilities have decreased significantly from £14,372 in 2023 to £2,919 in 2024, reducing leverage and short-term pressure. The company holds negligible fixed assets but maintains liquidity mainly through cash reserves (£15,778). The absence of long-term borrowings and positive net assets suggest a low gearing profile.

3. Cash Flow Assessment:
   Liquidity is robust with cash nearly covering current liabilities fivefold in 2024. The net current assets of £13,067 provide a healthy working capital buffer, indicating capacity to absorb fluctuations in cash flow or unexpected expenses. Debtors are minimal, suggesting prompt collection or low credit sales exposure. However, reliance on director loans and the small absolute cash figures reflect the company’s modest scale and early stage. Continued cash flow monitoring is advised to ensure ongoing operational viability.

4. Monitoring Points:

• Maintain watch on cash conversion cycles, particularly debtor days as they are currently minimal but could impact liquidity if sales scale.
• Monitor changes in creditor balances and any increase in related party transactions, especially interest-free loans from the director, to ensure they remain supportive and manageable.
• Track profitability and retained earnings growth to sustain equity base and reduce reliance on director funding.
• Confirm timely filing of all statutory returns continues to avoid regulatory penalties or reputational risk.