Company Number: 13121507

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

1. Risk Rating: HIGH

Justification: CF Telecom Solutions Ltd shows a marked deterioration in liquidity with net current liabilities of £13,139 as of 31 January 2024, compared to net current assets in prior years. This negative working capital position raises concerns about the company’s ability to meet short-term obligations. The small scale of operations (one employee, micro-entity status) and limited equity base (£5,361 net assets) further increase solvency risk.

2. Key Concerns:

• Liquidity shortfall evidenced by current liabilities exceeding current assets by over £13k in the latest accounts.
• Declining net assets, halving from £10,556 in 2023 to £5,361 in 2024, indicating erosion of equity.
• Very limited operational scale with only one director/employee and minimal share capital (£1), which may constrain business resilience and capacity to generate cash flow.

3. Positive Indicators:

• The company is active and current with all filing obligations, including accounts and confirmation statements, demonstrating regulatory compliance.
• No indication of insolvency proceedings or director disqualifications.
• Fixed assets presence (£18,500) in 2024 suggests some investment in tangible or intangible resources.

4. Due Diligence Notes:

• Investigate the nature and timing of current liabilities to assess whether these are trade payables, accrued expenses, or short-term debt, and the risk of default.
• Review cash flow statements or bank statements to verify actual liquidity position and operational cash generation.
• Assess reasons behind the significant increase in current liabilities from 2023 to 2024 and whether this is a one-off or ongoing trend.
• Understand the business model and revenue streams given the micro-scale operation and sector (wireless telecommunications).
• Confirm the director’s plans or strategies to address the declining net assets and working capital deficit.