Company Number: 12614072

Analysis Date: 2025-07-20 15:39 UTC

1. Credit Opinion: APPROVE with monitoring
   Blue Sky ERP Ltd demonstrates a sound financial position with growing net current assets and shareholders’ funds over the last five years. The company maintains positive working capital and liquidity, supported by a healthy cash balance and manageable current liabilities. Directors have filed accounts on time, and no adverse director conduct or company status issues exist. However, the company is relatively young (incorporated in 2020) and small in scale, so ongoing monitoring is recommended to confirm sustainability of growth and cash flow stability.

2. Financial Strength:

• Shareholders’ funds increased from £29.5k in 2020 to £193.6k in 2024, indicating retained earnings accumulation and equity growth.
• Net current assets rose from £28.8k to £183.2k, reflecting improved liquidity and operational funding capacity.
• Tangible fixed assets are minimal (£10.4k), typical for an IT consultancy, implying low capital intensity and asset risk.
• The balance sheet shows no long-term liabilities; the company appears to rely on short-term trade creditors and tax liabilities, which are manageable relative to current assets.

3. Cash Flow Assessment:

• Cash decreased slightly from £140.3k in 2023 to £126.6k in 2024, but remains robust relative to current liabilities (£214.7k).
• Debtors increased substantially to £271.3k, which may impact cash flow timing; collection efficiency should be monitored.
• Current liabilities rose to £214.7k, mainly trade creditors and tax obligations; the company must ensure timely settlement to avoid penalties.
• Net current assets and positive working capital indicate the company can meet short-term obligations without liquidity stress.

4. Monitoring Points:

• Debtor aging and cash collection to ensure receivables convert to cash timely and do not strain liquidity.
• Tax liabilities remain high and should be reviewed for payment scheduling and potential deferred tax risks.
• Continued growth in turnover and profitability to maintain and improve equity and cash balances.
• Directors’ management of expenses and creditor payments to sustain working capital.
• Monitor filing deadlines and any changes in company or director status.