Company Number: 12798154

Analysis Date: 2025-07-20 14:58 UTC

1. Risk Rating: MEDIUM

Justification: CLS Auto Solutions Ltd has shown a significant turnaround in financial position within the latest reporting year, moving from net liabilities and negative equity to positive net assets and shareholders' funds. However, the company exhibits modest working capital and relatively low cash reserves, and it operates with no employees. The limited scale and recovery from previous losses warrant a medium risk assessment pending further operational and cash flow evidence.

2. Key Concerns:

• Liquidity Position: Cash balances decreased markedly from £56,827 in 2022 to £19,775 in 2023, while current liabilities remain substantial (£63,837). Although net current assets improved to positive £7,407, the relatively low cash buffer could signal potential short-term liquidity pressures.

• Operational Scale and Stability: The company reported zero employees during 2023, which may indicate limited operational capacity or reliance on the director and contractors. This raises questions about sustainability and scalability of the business model.

• Profitability and Historical Losses: The company transitioned from a retained loss position (-£19) in 2022 to a reported profit (~£18,761), but the absence of an income statement and audit limits insight into the quality and sustainability of earnings.

3. Positive Indicators:

• Solvency Improvement: The company moved from negative net assets (-£18) in 2022 to positive net assets (£18,743) in 2023, reflecting an improved solvency position.

• Compliance with Filings: Accounts and confirmation statements are up to date with no overdue filings or penalties noted, suggesting sound regulatory compliance.

• Ownership and Control: The sole director and 75-100% shareholder, Mr Colin Lester Sheen, has maintained continuous control since incorporation, which may support consistent management and decision-making.

4. Due Diligence Notes:

• Review detailed profit and loss information, if available, to verify the nature and sustainability of the reported profit in 2023.

• Investigate cash flow statements and creditors' aging to assess liquidity dynamics and potential payment delays.

• Clarify operational structure, including use of contractors or outsourcing, given zero employee count, to assess business continuity risks.

• Confirm absence of director disqualifications or regulatory sanctions related to the sole director.

• Evaluate the impact of provisions for liabilities (£2,271) and any contingent liabilities not disclosed.