Company Number: 13476607

Analysis Date: 2025-07-29 14:23 UTC

1. Risk Rating: MEDIUM
   Justification: Big Up World Ltd shows growth in net assets and working capital over the last two years, indicating improving financial health. However, the company carries significant long-term liabilities, particularly a large directors' loan account and finance lease obligations, which elevates solvency risk. The current liabilities are also relatively high compared to current assets, though net current assets remain positive.

2. Key Concerns:

• High Long-term Debt: The directors' loan account (£171,166) and finance lease liabilities (£47,715 total) are substantial relative to net assets (£25,241), suggesting reliance on related party funding and external finance which may pressure cash flows.
• Liquidity Pressure: Although net current assets are positive (£113,705), cash reserves (£32,261) are modest compared to current liabilities (£51,205), and trade creditors and bank loans form a notable portion of short-term obligations.
• Limited Equity Base: Share capital is minimal (£2), and accumulated profits are relatively low (£25,239), which may limit the company’s ability to absorb shocks or raise additional equity funding.

3. Positive Indicators:

• Consistent Growth in Net Assets: Net assets have increased from £5,247 in 2023 to £25,241 in 2024, reflecting profitable operations or capital injections.
• Positive Net Current Assets: The company maintains a healthy working capital position, indicating the ability to meet short-term liabilities from current assets.
• Timely Compliance: Accounts and confirmation statements are filed on time, with no overdue filings, suggesting good regulatory compliance.
• Operating in Retail Sector: The company operates in retail sale of beverages and food, which can provide steady revenue streams if managed well.

4. Due Diligence Notes:

• Investigate the terms and repayment schedule of the directors' loan account and finance leases to assess refinancing risks and cash flow impact.
• Review cash flow statements and projections to verify liquidity adequacy and the ability to service short-term obligations.
• Understand the nature and turnover of stock (£127,738) to ensure inventory is not overvalued or obsolete.
• Confirm no outstanding contingent liabilities or off-balance-sheet obligations that may impair solvency.
• Evaluate the director’s background and related party transactions for governance and conflict of interest risks.
• Assess profitability trends and margins given the retail sector exposure and any seasonality or market risks.