Company Number: 13124534

Analysis Date: 2025-07-20 15:19 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   Cosmos Accounting Limited is a micro-entity operating in accounting and auditing services with two directors as significant controllers. The company is currently active, compliant with filing deadlines, and shows a positive net asset position. However, the recent year shows a decline in net assets and a slight working capital deficit, indicating some short-term liquidity pressure. Given the micro scale, modest share capital, and limited fixed assets, I recommend conditional approval, subject to monitoring cash flow improvements and ensuring timely creditor payments.

2. Financial Strength:

• Net assets decreased from £2,215 in 2023 to £1,303 in 2024, a 41% reduction over one year.
• Fixed assets declined modestly from £2,003 to £1,502, reflecting limited capital investment or asset disposals.
• The company maintains positive shareholders' funds but at a reduced level, reflecting erosion of reserves or retained earnings.
• The business remains solvent with total assets exceeding liabilities but the margin has narrowed significantly.

3. Cash Flow Assessment:

• Current assets increased from £7,033 to £8,894, primarily cash and receivables.
• Current liabilities rose substantially from £5,821 to £9,093, leading to a net current liability position of £199 in 2024 versus a net current asset of £1,212 in 2023.
• This negative working capital position signals potential short-term liquidity stress, which could impact the ability to meet immediate obligations without additional financing or cash inflows.
• The company has only two employees, suggesting low overhead but also limited scale to absorb financial shocks.

4. Monitoring Points:

• Monitor quarterly cash flow statements to ensure the company can manage current liabilities and improve working capital.
• Watch for any further declines in net assets or shareholder funds, which may indicate weakening financial resilience.
• Track director and shareholder activity for any changes in control or strategic direction that could affect credit risk.
• Confirm the company maintains timely payment of suppliers and creditors to avoid strained trade relationships.
• Review annual accounts for profit/loss trends and any notes on contingent liabilities or financial risks.