CLOUD CARS LIMITED

Risk Rating: HIGH Justification: The company is technically balance sheet insolvent, with net liabilities of £89,999 as of 31 July 2024. While current assets marginally exceed current liabilities, the overall deficit and the opacity of micro-entity reporting present significant financial and informational risks to institutional investors.

Key Concerns: * Balance Sheet Insolvency: The latest filed accounts text confirms net assets of (£89,999)—denoted by parentheses in the financial statements, indicating a negative figure. Total assets stand at only £19,772 against total liabilities of approximately £109,771 (comprising £8,499 current and £101,272 long-term). The company cannot meet its long-term obligations from its asset base. * Minimal Liquidity Buffer: Net current assets are a precarious £1,970 (Current assets £10,469 less Current liabilities £8,499). This leaves virtually no margin for operational disruptions, unexpected costs, or revenue shortfalls. * Financial Opacity: As a micro-entity filing under FRS 105, the company files an abridged balance sheet only. No Profit & Loss account, cash flow statement, or director's strategic report is available on the public record. It is impossible to assess revenue generation, operational profitability, or actual cash flow from the filed data.

Positive Indicators: * Improving Trajectory: The net asset position has improved year-on-year, moving from (£106,719) in 2023 to (£89,999) in 2024. Long-term liabilities have also reduced by approximately £10,000 over the same period, suggesting either active debt repayment or the forgiveness of liabilities. * Regulatory Compliance: The company's accounts and confirmation statements are filed on time and not overdue, indicating administrative stability and a willingness to meet statutory obligations. * Positive Working Capital: Despite being thin, the fact that current assets exceed current liabilities means the company is not facing an immediate, day-to-day cash crunch based on the balance sheet date.

Due Diligence Notes: * Nature of Long-Term Liabilities: The £101,272 in creditors falling due after more than one year requires urgent clarification. Given the scale relative to the company's size, this likely represents director or shareholder loans. Confirmation is needed on whether these loans are subordinated, unsecured, or if repayment demands are imminent. * Asset Financing: XBRL taxonomy tags within the filing reference "LeasedAssetsHeldAsLessee" and "MotorCars" (SIC code 53201 indicates licensed carriers, i.e., taxi/PHV operations). It must be determined if the long-term liabilities represent vehicle financing and what the terms and security over these assets are. * Third PSC Influence: Mr. Gary Richard Holmes is listed as a Person with Significant Control due to having "significant influence or control," despite not holding 25%+ of shares or voting rights. The nature of his influence, his relationship to the company, and any related-party transactions must be investigated. * Trading Viability: Request internal management accounts to ascertain if the company is generating positive operating cash flow. The reduction in liabilities suggests cash generation, but without a P&L, this cannot be verified.