CAKE CUPID LTD

Executive Summary

CAKE CUPID LTD exhibits a high risk profile due to increasing negative net assets and poor liquidity, indicating potential solvency challenges. While regulatory compliance is maintained, the company’s financial data raises concerns about operational sustainability. Further due diligence on cash flow and business viability is essential before considering investment.

CAKE CUPID LTD - Analysis Report

Company Number: 12766607

Analysis Date: 2025-07-29 18:16 UTC

1. Risk Rating: HIGH
   The company’s net current liabilities have increased significantly, indicating an inability to cover short-term obligations with current assets. The negative net assets position worsened from £-432 in 2023 to £-1,821 in 2024, signaling deteriorating financial health and potential solvency risk.

2. Key Concerns:

• Solvency Risk: Negative net assets and net current liabilities suggest the company may struggle to meet its liabilities as they fall due.
• Liquidity Concerns: Current assets (£138) are minimal compared to current liabilities (£1,959), reflecting poor short-term liquidity and potential cash flow difficulties.
• Operational Stability: The company has consistently reported very low asset levels and shrinking equity, with no indication of significant revenue or capital injection, raising concerns about sustainable operations.

3. Positive Indicators:

• Compliance: The company’s accounts and confirmation statements are filed on time with no overdue filings, indicating good regulatory compliance.
• Continuity: The company remains active since incorporation in 2020 with a single director who maintains full control, which could facilitate decisive management actions.
• Micro Entity Status: The small size and micro-entity reporting may reduce administrative burdens and costs, beneficial for a small, owner-managed business.

4. Due Diligence Notes:

• Investigate Cash Flow: Obtain detailed cash flow statements or bank statements to assess actual liquidity beyond the limited balance sheet snapshot.
• Review Business Model and Revenue Streams: Clarify how the company generates income and its plans to improve financial stability given the persistent negative net assets.
• Director’s Intent and Support: Understand whether the sole director is providing additional financial support or plans restructuring to address solvency issues.
• Examine Creditors Composition: Assess the nature and terms of current liabilities to evaluate urgency and risk of enforcement actions.