BARE LINKED LTD

Executive Summary

BARE LINKED LTD exhibits a critical weakening of its financial position with negative net assets and net current liabilities that undermine its ability to meet short-term obligations. The company’s micro-entity status and limited cash reserves raise significant concerns about liquidity and creditworthiness. Based on these factors, extending credit is not advisable without substantial improvement in financial metrics and cash flow generation.

BARE LINKED LTD - Analysis Report

Company Number: 13821024

Analysis Date: 2025-07-20 14:59 UTC

1. Credit Opinion: DECLINE
   BARE LINKED LTD demonstrates a significant deterioration in its financial position over the latest reporting period. The company moved from positive net current assets of £8,278 in 2023 to a substantial net current liabilities position of £32,206 in 2024. This indicates an inability to cover short-term obligations from current assets, raising liquidity concerns. The negative net assets imply an erosion of shareholder funds, suggesting financial distress and a heightened risk of default. Given the micro-entity status and limited financial information, the company’s capacity to generate sufficient cash flow to service debt is doubtful without external support. Therefore, credit facilities are not recommended at this time.

2. Financial Strength:
   The balance sheet shows a marked decline in financial strength. Shareholders’ funds have shifted from a positive £8,278 to negative £32,206 within one year, signaling accumulated losses or increased liabilities. Current liabilities increased by approximately 30% (from £27,610 to £36,013), while current assets dropped sharply from £35,888 to £3,807. The absence of fixed assets and minimal working capital restricts the company’s ability to absorb financial shocks. This weak financial structure indicates poor capital adequacy and an elevated risk profile.

3. Cash Flow Assessment:
   The sharp decrease in current assets, particularly cash or equivalents, combined with increased short-term liabilities, indicates strained liquidity and poor working capital management. The company’s net current liabilities position suggests difficulty meeting immediate payables and operational expenses. With only one employee and limited turnover implied by micro-entity classification, cash inflows are likely insufficient to support ongoing obligations. The lack of an audit and limited disclosure on profit and loss further impede a confident cash flow assessment.

4. Monitoring Points:

• Quarterly monitoring of liquidity ratios, especially current ratio and quick ratio.
• Tracking any improvement or further deterioration in net current assets.
• Review of management actions to reduce liabilities or improve cash collections.
• Assessment of any changes in ownership or capital injections that could shore up net assets.
• Monitoring filing compliance and any late submissions that could indicate operational difficulties.