COGS AI LTD

Executive Summary

Cogs AI Ltd exhibits high financial risk marked by persistent negative equity and increased long-term liabilities, raising concerns about solvency and liquidity. While regulatory compliance is maintained and short-term liquidity improved, the company’s operational sustainability remains uncertain given its micro-entity size and financial position. Further review of debt terms and cash flows is advised to clarify viability.

COGS AI LTD - Analysis Report

Company Number: 13546667

Analysis Date: 2025-07-29 19:00 UTC

1. Risk Rating: HIGH
   The company's financial position shows significant and worsening net liabilities, with net assets declining from -£63k in 2023 to -£101k in 2024. Long-term liabilities have increased substantially, indicating over-reliance on external funding or debt. The negative equity position and large creditor balances relative to current assets signal solvency and liquidity risks.

2. Key Concerns:

• Solvency risk: Persistent negative net assets and increasing long-term liabilities suggest the company may struggle to meet obligations without additional capital injection.
• Liquidity concerns: Although net current assets improved in 2024, the presence of high creditors after one year (£130k) raises questions about cash flow sufficiency to service debts.
• Operational sustainability: The company is a micro-entity with only 4 employees and very limited fixed assets, relying heavily on current assets and likely on external financing, which may be unsustainable long term.

3. Positive Indicators:

• The company is up to date with statutory filings and accounts, indicating compliance with regulatory requirements.
• Net current assets improved markedly in 2024 compared to previous years, suggesting some short-term liquidity management progress.
• Directors hold significant control and have been in place since incorporation, implying stable leadership.

4. Due Diligence Notes:

• Investigate the nature and terms of the long-term liabilities (£130k in 2024) to assess repayment schedules and covenants.
• Review cash flow statements and recent bank statements to understand liquidity dynamics and working capital management.
• Assess business model viability and revenue generation plans given the ongoing losses and negative equity.
• Confirm no director disqualifications or regulatory issues beyond public filings.