CLARITYPORT LTD

Executive Summary

Clarityport Ltd presents a financially stable profile with positive net assets, adequate working capital, and no regulatory compliance issues. However, a notable decrease in cash reserves and a standing provision of £20,000 warrant further investigation to confirm ongoing liquidity and solvency strength. Overall, the company’s small operational scale and reliance on a single director should be considered in assessing operational risk.

CLARITYPORT LTD - Analysis Report

Company Number: 12745029

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

1. Risk Rating: LOW
   The company demonstrates a consistent positive net asset position, adequate net current assets, and no overdue filings. Its liquidity position shows sufficient current assets to cover short-term liabilities, indicating low solvency and liquidity risk.

2. Key Concerns:

• The significant drop in cash from £42,431 in 2023 to £15,650 in 2024 may warrant further review to understand cash flow dynamics and if this impacts operational flexibility.
• Presence of a £20,000 provision for liabilities reduces net assets and could indicate a contingent or ongoing obligation affecting financial stability. Details about this provision should be clarified.
• The company operates with a single director and a small staff complement (average 3 employees), which may present operational risks related to management capacity and succession.

3. Positive Indicators:

• The company has maintained net current assets comfortably above £30,000 over recent years, indicating good working capital management.
• No overdue accounts or confirmation statements filings mitigate regulatory compliance risk.
• The company benefits from a stable shareholder equity base with retained earnings increasing from £13,183 in 2023 to £14,589 in 2024, suggesting profitability or positive retained earnings accumulation.
• The going concern basis is affirmed by the director, supported by consistent current assets coverage over liabilities.

4. Due Diligence Notes:

• Investigate the nature and expected timing of the £20,000 provisions to assess potential impact on solvency and cash flow.
• Review cash flow statements or management accounts for the current year to understand the significant reduction in cash balances and whether this is temporary or indicative of cash flow pressure.
• Confirm the robustness of the company’s operational model given the small team size and reliance on a single director.
• Verify whether there are any off-balance-sheet liabilities or contingent risks not captured in the limited accounts.
• Assess client concentration and debtor quality, as debtors increased markedly from £10,460 in 2023 to £38,135 in 2024, which may affect liquidity if not collectible on time.