AVANTIS WEALTH LTD
Company number 08292970 · Monitor this company
This analysis was written by an AI from the company's public filings. It may contain errors or omissions and is not financial or professional advice.
Investment Risk Analysis: AVANTIS WEALTH LTD (08292970)
1. Risk Rating: HIGH
Justification: The company is currently in liquidation with negative net assets of £167,626 as of the last filed accounts (March 2021). The registered office has been transferred to what appears to be an insolvency practitioner's address (RRS S&W Partners LLP). Both statutory filings are overdue. This represents a terminal insolvency event rather than a going concern risk.
2. Key Concerns
a) Liquidation Status and Technical Insolvency
The company status is confirmed as "Liquidation." Net assets have been negative since at least 2020 (£-280,869), improving slightly to £-167,626 by 2021, but the company remains balance-sheet insolvent. The transfer of registered address to an insolvency practice (C/O RRS S&W Partners LLP, 45 Gresham Street, London) strongly suggests formal insolvency proceedings are underway or imminent. This is a terminal condition for investment purposes.
b) Significant Related Party Entanglements
The accounts reveal deeply interconnected related-party transactions that raise concerns about financial independence and potential conflicts of interest: - Debtor: Panorama Gardens Ltd (controlled by director Mr R Thomas) owes £497,668 (2020: £468,756), with £28,912 interest charged at 6% annually. This represents approximately 66% of total debtors and a material concentration risk. - Creditor: Inspired Investments Ltd (also controlled by Mr R Thomas) is owed £848,977 (2020: £957,063), with £55,915 interest charged at 6% annually. This represents approximately 96% of long-term creditors.
The circular nature of these transactions—where the same individual controls both the debtor and creditor entities—creates significant concerns about substance and recoverability.
c) Directors' Loans and Governance
Mr R M Thomas has an outstanding directors' loan of £35,396 (increased from £14,607 in 2020, which itself increased from £25,372 in 2019). The pattern shows advances being made to the director while the company is insolvent and reliant on related-party lending. This raises questions about whether the company's limited cash resources are being appropriately prioritized for creditor obligations.
3. Positive Indicators
Limited positive indicators exist given the liquidation status, but the following observations are noted:
- Working Capital Position: Net current assets were positive at £713,215 (2021), suggesting some short-term liquidity existed at the balance sheet date, though this is heavily reliant on the £502,914 long-term debtor from the related party.
- Partial Debt Reduction: Net liabilities improved from £-280,869 to £-167,626 between 2020 and 2021, indicating some deleveraging. The Inspired Investments Ltd loan reduced by approximately £108,000.
- Cash Position Improved: Cash increased from £3,065 to £80,395, though this may reflect timing of related-party fund flows rather than operational cash generation.
4. Due Diligence Notes
| Item | Investigation Required |
|---|---|
| Liquidation Details | Determine the type of liquidation (voluntary vs. compulsory), date of commencement, and identity of liquidator. The registered office change to RRS S&W Partners LLP suggests this is already underway. |
| Related Party Recoverability | Assess whether Panorama Gardens Ltd has the means to repay £497,668+interest. Examine Panorama Gardens Ltd's own financial position and any cross-guarantees. |
| Inspired Investments Ltd Position | Understand the terms of the £848,977 loan from Inspired Investments Ltd. Determine whether this creditor has security and their ranking in the liquidation waterfall. |
| Director Conduct | Review whether Mr R M Thomas has any disqualification orders or prior insolvency involvement with other companies. The pattern of directors' loans while the company is insolvent warrants scrutiny. |
| Filing Non-Compliance | Both accounts and confirmation statements are overdue. Establish whether the liquidator has obtained filing extensions or whether penalties have accrued. |
| Employee Obligations | Employee headcount dropped from 11 to 7. Verify whether redundancies were handled compliantly and whether any employee claims (e.g., unpaid wages, redundancy payments) exist as preferential creditors. |
| Asset Realization | Tangible fixed assets of only £8,472 exist. The primary "asset" is the related-party debtor. Assess realistic recovery prospects and liquidator's assessment of collectability. |
| Trade Debtors | Trade debtors fell dramatically from £119,721 to £4,400. Understand whether this reflects collection, write-off, or reclassification. |
| Historical Trajectory | Net assets declined from £709,951 (2018) to £80,653 (2019) to negative thereafter. Investigate the 2018-2019 period for the trigger event—whether this was an impairment, write-off, or operational loss. |