CLJ DESIGN MANAGEMENT LTD

Executive Summary

CLJ Design Management Ltd is a compliant micro-entity with positive but shrinking net current assets and a significant decrease in net assets over the last year. While it currently meets short-term obligations, limited financial transparency and reduced equity suggest moderate solvency and liquidity risk. Further examination of underlying financial performance and cash flows is recommended to ensure operational sustainability.

CLJ DESIGN MANAGEMENT LTD - Analysis Report

Company Number: 13527518

Analysis Date: 2025-07-29 20:05 UTC

1. Risk Rating: MEDIUM
   The company shows positive net current assets, indicating it can meet short-term obligations currently. However, a significant reduction in net assets from £1,579 to £497 within one year and the presence of accruals/deferred income suggest potential liquidity pressure or deferred revenue recognition. The micro-entity status limits the depth of financial disclosure, restricting full assessment.

2. Key Concerns:

• Declining Net Assets: The drop in net assets by approximately 68% in the last year could indicate reduced profitability or capital erosion.
• Low Working Capital Buffer: Net current assets remain positive but have shrunk, leaving a narrow margin to cover current liabilities.
• Limited Financial Transparency: As a micro-entity, the company benefits from simplified reporting, so detailed profit and loss or cash flow data is unavailable, limiting insight into operational sustainability.

3. Positive Indicators:

• Compliance: The company is active with up-to-date filings; no overdue accounts or confirmation statements are noted, demonstrating regulatory adherence.
• Ownership and Control: The shareholding and voting rights are well-distributed among three directors, which may promote stable governance.
• Stable Employment: The average number of employees has remained constant at two over the last two years, indicating operational continuity.

4. Due Diligence Notes:

• Investigate the reason for the significant decline in net assets, including any extraordinary expenses or impairments.
• Request management accounts or cash flow statements to assess actual liquidity and cash generation capability.
• Clarify the nature of accruals and deferred income to understand timing of cash inflows and outflows.
• Confirm absence of contingent liabilities or off-balance sheet obligations that may impact solvency.
• Review directors' background and related party transactions given the family-like shareholding and directorship structure.