Company Number: 12631977

Analysis Date: 2025-07-20 16:06 UTC

1. Risk Rating: HIGH
   The company’s financial statements show persistent negative net assets (shareholders funds) of £(15,493) as of May 2024 and a worsening trend from prior years, indicating insolvency on a balance sheet basis. Current liabilities significantly exceed current assets, highlighting liquidity concerns.

2. Key Concerns:

• Solvency Risk: The company has negative net assets for at least two consecutive years (£(15,493) in 2024 and £(17,263) in 2023), suggesting it is balance sheet insolvent.
• Liquidity Issues: Current liabilities (£20,719) far exceed current assets (£1,059) in the latest year, indicating potential cash flow difficulties to meet short-term obligations.
• Operational Stability: Despite being active since 2020 with a small workforce (2 employees), the company has not improved its financial position but rather deteriorated, raising questions on sustainability and profitability.

3. Positive Indicators:

• The company remains active and compliant with filings (accounts and confirmation statements submitted on time, no overdue filings).
• Incorporation and directorship details show no apparent governance issues; only one director is listed with no disqualifications noted.
• The business operates under a micro-entity reporting regime, reducing administrative burden.

4. Due Diligence Notes:

• Investigate the nature of current liabilities to assess if they are trade payables, loans, or other obligations and their maturity profiles.
• Review detailed profit and loss data (not provided) to understand operating performance, cash flow generation, and reasons for continued losses or asset depletion.
• Examine director’s report or strategic commentary (if available) for management plans to restore financial health or address solvency issues.
• Confirm whether any informal arrangements exist with creditors or if there is ongoing risk of insolvency proceedings.
• Verify whether the company continues trading profitably or relies on external funding injections.