Company Number: 12773627

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

1. Risk Rating: MEDIUM
   The company shows signs of financial strain with net current liabilities over the last two years, although it remains solvent with positive net assets. The micro-entity status limits detailed financial disclosure, restricting full risk assessment.

2. Key Concerns:

• Liquidity Issues: Negative net current assets in 2023 and 2024 indicate potential cash flow difficulties to meet short-term obligations.
• Declining Net Assets: Net assets have declined from £42,019 in 2021 to £1,943 in 2024, indicating erosion of equity and possible operational or financial stress.
• Limited Capital Base: Share capital is nominal (£10), which may limit capacity to absorb losses or raise funds internally.

3. Positive Indicators:

• Compliance with Filing: Accounts and confirmation statements are filed on time, showing regulatory adherence and good governance in this area.
• Operating Stability: The company has been active since 2020 and maintains a small but stable workforce (average 2 employees).
• No Auditor Requirement: Exemption from audit under micro-entity rules reduces compliance burdens and costs, appropriate for the company size.

4. Due Diligence Notes:

• Investigate causes behind the sharp decline in net assets and persistent negative working capital in recent years.
• Review cash flow statements (if available) or bank records to assess liquidity management and short-term solvency.
• Confirm the nature and timing of liabilities comprising current liabilities to understand if any overdue or default risks exist.
• Evaluate the business model sustainability given the small asset base and negative working capital trends.
• Check for any contingent liabilities, related party transactions, or off-balance sheet obligations that may not be apparent in micro-entity accounts.