Company Number: 14299237

Analysis Date: 2025-07-20 11:43 UTC

1. Credit Opinion: CONDITIONAL APPROVAL

BEANS AND BUNS LIMITED is a micro-entity recently incorporated in 2022 operating in the unlicensed restaurant and café sector. The company shows positive net assets and an improving financial position over two years, indicating growth. However, the current liabilities remain high (£50,000) relative to current assets, and net current assets are marginal (£5,297), which signals working capital constraints. Given this, credit approval is conditional on close monitoring of liquidity and timely repayment capacity assurances. The company’s short operating history and relatively small scale require cautious exposure limits.

2. Financial Strength

• Fixed assets have increased slightly from £75,000 (2023) to £80,000 (2024), indicating some reinvestment or asset acquisition.
• Net assets improved significantly from £13,726 in 2023 to £35,297 in 2024, reflecting either retained earnings or additional equity injection.
• The company carries a long-term liability of £50,000, which remains unchanged, suggesting a stable long-term debt position.
• Shareholders’ funds increased in line with net assets, showing equity backing.

Overall, the balance sheet shows modest but positive growth with equity backing the liabilities adequately. The company is solvent but has limited buffer due to the micro-entity scale.

3. Cash Flow Assessment

• Current assets increased from £10,597 to £27,554, a positive liquidity trend.
• Current liabilities remain constant at £50,000, resulting in a net current asset position of only £5,297.
• The working capital position is tight, indicating potential liquidity risk if cash inflows slow or payables accelerate.
• No audit or profit and loss details were provided, which limits deeper cash flow forecasting but the available data suggests the company must carefully manage cash.

4. Monitoring Points

• Monitor liquidity ratios closely, especially current ratio and quick ratio given tight working capital.
• Track debt servicing ability on the long-term £50,000 liability.
• Watch for any changes in current liabilities or asset impairments.
• Review profit and loss accounts when available for operational performance and cash generation.
• Monitor director conduct and any changes in ownership or control.
• Confirm timely filing of accounts and returns to avoid compliance risk.