Company Number: SC660049

Analysis Date: 2025-07-20 13:10 UTC

1. Risk Rating: HIGH
   The company exhibits persistent negative net current assets and shareholders' funds, indicating a weak solvency position. Reliance on director advances without formal repayment terms presents liquidity and operational sustainability concerns.

2. Key Concerns:

• Negative net current assets and shareholders' funds: The company has maintained a negative working capital position for multiple years, suggesting ongoing financial strain and potential inability to meet short-term liabilities.
• Director loans as a significant creditor: £37,566 owed to directors with no formal repayment schedule or interest may mask underlying liquidity issues and dependency on related party funding.
• Declining debtor balances from group undertakings: A substantial decrease in amounts owed by group undertakings from £49,520 in 2023 to £17,068 in 2024 could indicate collection difficulties or operational challenges within the group structure.

3. Positive Indicators:

• Active status with no overdue filings: The company remains compliant with Companies House filing requirements, reducing regulatory risk.
• Stable cash balance improvement: Cash at bank increased substantially from £6,728 in 2023 to £28,391 in 2024, indicating some improvement in immediate liquidity.
• No employees reported: Minimal overhead from staffing may reduce fixed costs and cash burn.

4. Due Diligence Notes:

• Investigate the nature and sustainability of director loans, including any informal arrangements and future funding plans.
• Review debtor aging and collectability, particularly amounts due from group undertakings, to assess revenue quality and cash flow reliability.
• Examine operational activities and revenue streams to understand the root causes of continued losses and negative equity.
• Confirm tax liabilities and potential contingent liabilities as tax creditor has increased.
• Assess the business model and strategy updates given persistent financial weaknesses and absence of employees.