Company Number: 13616503

Analysis Date: 2025-07-29 13:45 UTC

1. Risk Rating: HIGH
   Berkeley House Sub Ltd exhibits significant solvency concerns due to negative net assets and persistent large current liabilities substantially exceeding current assets. The company’s inability to maintain positive equity and net current assets raises red flags regarding its financial stability.

2. Key Concerns:

• Negative Net Assets: The net assets have declined from a small positive balance (£8,786 in 2023) to a negative position (£-18,263 in 2024), indicating erosion of shareholder value and potential insolvency risk.
• Severe Working Capital Deficit: Current liabilities (£1,108,897) far exceed current assets (£44,877), resulting in a net current liability of over £1 million, pointing to liquidity stress and potential difficulty meeting short-term obligations.
• No Operating Employees or Revenue Data: The company reports zero employees and no profit & loss account filed, limiting insight into operational viability or cash flow generation.

3. Positive Indicators:

• Substantial Fixed Assets: The company holds fixed assets valued at £2.13 million, which may provide some security for creditors if these assets are realizable.
• Compliance with Filings: Accounts and confirmation statement are up to date with no overdue filings, suggesting regulatory compliance and governance discipline.
• Single Director with No Known Disqualifications: The company is managed by a single director with no publicly noted governance issues.

4. Due Diligence Notes:

• Assess Asset Liquidity and Valuation: Investigate the nature, liquidity, and market value of the fixed assets to understand their realizable value in a distressed scenario.
• Review Financing Structure: Clarify the terms and maturity profile of the substantial current and long-term liabilities to assess repayment risk and potential refinancing needs.
• Operational Cash Flows and Business Model: Obtain detailed financial statements including profit and loss, cash flow statements, and explanations for negative net equity and working capital deficits.
• Contingent Liabilities or Related Party Transactions: Check for any off-balance sheet liabilities or significant transactions with related parties that might affect financial health.
• Director's Intentions and Plans: Understand management’s strategy to restore solvency and improve liquidity, including any capital injections or asset disposals planned.