Company Number: 14031392

Analysis Date: 2025-07-19 12:05 UTC

1. Risk Rating: LOW
   Carver Electrical Limited demonstrates a positive solvency position with improving net assets and net current assets, no overdue filings, and no indications of financial distress despite being a young company incorporated in 2022.

2. Key Concerns:

• Director Loan Balance: The company has a significant loan from directors (£44,627 in 2024), which is sizeable relative to net assets and may indicate reliance on insider funding that should be monitored for repayment risk.
• Deferred Tax Provision: A deferred tax liability of £1,892 exists, which while not large, requires ongoing monitoring to understand potential future tax cash outflows.
• Limited Financial History: Only two full years of financial data are available since incorporation, limiting trend analysis and increasing uncertainty about long-term operational stability.

3. Positive Indicators:

• Improved Financial Position: Net assets increased substantially from £3,784 in 2023 to £59,463 in 2024, driven by growth in current assets and positive retained earnings.
• Strong Liquidity: Cash balance rose from £65,591 to £103,358, and net current assets improved from negative to positive (£53,735), indicating good short-term liquidity.
• Compliance and Governance: No overdue statutory accounts or confirmation statement filings; company remains in good standing with Companies House.
• Stable Operations: Consistent employee count (4) and ongoing activity in electrical installation (SIC 43210) suggest operational continuity.

4. Due Diligence Notes:

• Review the terms and repayment plan for the director loans to assess risk of insider funding withdrawal and its impact on cash flow.
• Investigate the nature and timing of deferred tax liabilities to anticipate potential future tax payments.
• Obtain management forecasts or business plans to evaluate sustainability and growth prospects beyond the limited historical data.
• Confirm no undisclosed related party transactions or contingent liabilities that could impact financial stability.
• Validate revenue recognition policies given the increase in debtors to ensure receivables quality.