Company Number: 13521544

Analysis Date: 2025-07-20 14:28 UTC

1. Risk Rating: MEDIUM
   The company demonstrates positive net current assets and shareholders' funds, indicating solvency at the balance sheet date. However, the significant debtor balance owed by a director and a reduction in net current assets compared to prior years suggest potential liquidity risks and reliance on related party transactions. The company is small, recently incorporated (2021), and has limited employee count, which can affect operational stability.

2. Key Concerns:

• Director-related debtor exposure: £31,623 owed by a director represents a substantial proportion of current assets, posing a liquidity risk if the director cannot repay timely.
• Declining net current assets: From £25,327 in 2023 to £8,351 in 2024, indicating tighter working capital and potential cash flow pressures.
• Low cash balance: Cash on hand is minimal (£636), raising concerns about the company's ability to meet immediate liabilities without relying on receivables or director advances.

3. Positive Indicators:

• Current liabilities are consistently covered: Net current assets remain positive, and shareholders' funds are healthy (£11,979 in 2024).
• No overdue filings or regulatory issues: Accounts and confirmation statements are up to date, reflecting good compliance and governance.
• Stable director involvement: Both directors have been with the company since incorporation and hold significant ownership, suggesting aligned interests and stable management.

4. Due Diligence Notes:

• Investigate the nature and collectability of the director's debtor balance, including terms, security, and repayment history.
• Review cash flow statements and forecasts to assess liquidity trends and working capital management.
• Examine operational performance and client base to evaluate business sustainability given the small employee count and turnover implied by exemption filings.
• Confirm no contingent liabilities or off-balance sheet risks related to director transactions or other commitments.