Company Number: 12606119

Analysis Date: 2025-07-20 15:40 UTC

1. Risk Rating: HIGH

Justification: The company shows a negative net asset position as of the latest accounts, with total net liabilities of £9,085 in 2023 compared to net assets of £464 in 2022. There is a significant increase in current liabilities relative to current assets, resulting in negative net current assets (-£13,740). These indicators suggest potential solvency and liquidity issues that could impair the company’s ability to meet obligations.

2. Key Concerns:

• Solvency Risk: The company’s net liabilities position in 2023 indicates it owes more than it owns, which raises concerns about its long-term viability.
• Liquidity Concerns: Current liabilities (£123,700) exceed current assets (£85,960) substantially, causing negative working capital and potential cash flow difficulties.
• Director Advances: The director has a large outstanding balance (£45,549) owed from advances/credits to the company, which may complicate financial stability or indicate reliance on director funding.

3. Positive Indicators:

• Active Status and Timely Filings: The company is active and has made all recent account and confirmation statement filings on time, demonstrating regulatory compliance.
• Growing Employee Base: The average number of employees increased from 12 to 23 between 2022 and 2023, suggesting business growth or expansion.
• Experienced Director: The primary director has been consistent since incorporation, potentially providing stable leadership.

4. Due Diligence Notes:

• Investigate the nature and terms of the director advances/credits to understand their impact on company liquidity and solvency.
• Review detailed financial statements and cash flow projections to assess ongoing operational performance and ability to service liabilities.
• Confirm any contingent liabilities or off-balance-sheet exposures not evident from micro-entity accounts.
• Evaluate the business model and customer contracts to ascertain sustainability given financial strain.
• Monitor for any late payments to suppliers or creditors that might signal worsening liquidity.