Credit Assessment: BRAEHEAD FINANCE LIMITED

1. Credit Opinion: DECLINE

Reasoning: This company presents an unacceptable credit risk. The business is balance-sheet insolvent with net liabilities of £1,159 and virtually no assets (£78). Between 2023 and 2024, the company experienced a catastrophic financial collapse—shareholders' funds plummeted from £3.9 million to negative £1,159—indicating a substantial distribution or asset transfer that has left the entity as an empty shell. With no employees, no visible income stream, and insolvent net worth, this company lacks any capacity to service new debt obligations.

2. Financial Strength

Severe deterioration; insolvent position.

The trajectory from 2016–2023 showed steady growth and a strong net asset position peaking at approximately £3.9 million. The abrupt collapse between May 2023 and May 2024—where assets fell from £3.99 million to £78—is highly material and concerning. This suggests a deliberate restructuring, dividend extraction, or asset transfer rather than trading losses.

The current balance sheet shows: - Current assets of just £78 - Creditors due within one year of £1,237 - No fixed assets - Negative shareholders' funds of £1,159

The company is technically insolvent and has been for two consecutive years.

3. Cash Flow Assessment

No operating capacity; minimal liquidity.

• The company has zero employees and is classified as a micro-entity, filing abbreviated accounts only
• No profit and loss account is disclosed, making it impossible to assess trading profitability
• Current assets of £78 against current liabilities of £1,237 yields a current ratio of 0.06:1—critically below any acceptable threshold
• The only identifiable asset is £78, which appears to be a nominal cash balance
• The director's loan note shows Mr M D Alexander had an outstanding balance of £12 in both 2024 and 2025, following repayment of £28,303 in the prior year—this repayment coincided with the period of asset depletion, which warrants scrutiny

There is no evidence of any revenue-generating activity. The SIC code (69201—Accounting and auditing activities) is inconsistent with the financial profile, suggesting the company may have ceased substantive operations.

4. Monitoring Points

If any existing exposure exists or business relationship is being considered despite this assessment, the following require ongoing surveillance:

1. Asset stripping risk: The near-complete depletion of £3.9 million in net assets between 2023 and 2024 should be investigated. Request full details of any distributions, dividends, or inter-company transfers made during this period.

2. Related party transactions: Both PSCs (Mr and Mrs Alexander) hold significant control. The director's loan repayment of £28,303 in 2024, concurrent with the balance sheet collapse, raises questions about the timing and priority of creditor payments.

3. Creditor position: The £1,237 creditor balance due within one year should be identified—is this related to the directors, professional fees, or third parties? The nature of these liabilities matters for any recovery assessment.

4. Filing compliance: Accounts are currently up to date, but given the company's dormant-like state, monitor for any failure to file confirmation statements or annual returns which could indicate abandonment.

5. Connected entities: Given the company's SIC code and the registered address being "C/O Social Money," investigate whether the Alexander family has other trading entities that may have received the assets of this company. This is critical for understanding group risk.

6. Dissolution risk: A company in this position with no apparent trading activity may be at risk of being struck off the register, which could crystallise any contingent liabilities.