Company Number: 13803187

Analysis Date: 2025-07-29 20:16 UTC

1. Risk Rating: MEDIUM
   Despite being a micro-entity with limited financial complexity, Belfry Electrical Services Ltd shows signs of increasing solvency risk evidenced by a sharp decline in net assets from £4,027 in 2023 to £396 in 2024 and a negative net current asset position of £-2,359. The company is still active and compliant with filings, but the weakened balance sheet warrants caution.

2. Key Concerns:

• Deteriorating Working Capital: Current liabilities have nearly doubled from £3,363 to £6,068 while current assets remained flat, resulting in negative net working capital. This raises liquidity concerns and questions the company’s ability to meet short-term obligations.
• Drastic Reduction in Net Assets: The dramatic fall in net assets within one year could indicate either operational losses or increased liabilities that are eroding the company’s capital base.
• Single Director and Small Scale Operation: With only one director who is also the sole shareholder and only one employee, there is operational risk related to lack of management depth and possible concentration risk.

3. Positive Indicators:

• Timely Compliance: The company is up to date with both accounts and confirmation statement filings, indicating good regulatory compliance and governance.
• No Indications of Insolvency Proceedings: The company is active, not in liquidation, administration, or receivership.
• Stable Industry: Operating in electrical installation (SIC 43210), a sector with steady demand, especially for domestic and commercial premises, which may support future revenue generation.

4. Due Diligence Notes:

• Investigate the cause of the sharp increase in current liabilities and drop in net assets between 2023 and 2024, including a review of any accrued debts or deferred payments.
• Review the profit and loss account (not available here) to determine whether losses are due to operational inefficiencies or extraordinary items.
• Confirm cash flow position and access to credit facilities to assess short-term liquidity beyond balance sheet snapshots.
• Assess the sustainability of management structure given it relies heavily on one individual.
• Confirm whether the company has any contingent liabilities or disputes not reflected in the financial statements.