Company Number: 14716366

Analysis Date: 2025-07-29 12:17 UTC

1. Risk Rating: HIGH
   The company exhibits significant solvency risk due to net liabilities of £272,562 and negative net current assets of the same amount. This indicates that current liabilities substantially exceed current assets, raising concerns about its ability to meet short-term obligations.

2. Key Concerns:

   • Negative Net Assets and Working Capital: The company’s balance sheet shows net liabilities of over £270k with current liabilities exceeding current assets by a wide margin, which signals financial distress.
   • High Reliance on Group Funding: Amounts owed to group undertakings (£363,241) represent the majority of current liabilities and are repayable on demand, creating liquidity risk if group support is withdrawn.
   • Early Stage and Small Scale: Incorporated in 2023, with only one employee and no significant tangible fixed assets, the company’s operational scale is minimal, increasing vulnerability to business disruption.

3. Positive Indicators:

   • No Overdue Filings: Both accounts and confirmation statement are filed on time, indicating compliance with statutory requirements and sound governance in this respect.
   • Clear Ownership and Control: The company is 75-100% owned by a parent entity (Cando Combined Ltd), which is in turn controlled by the director, providing a clear control structure that may facilitate group support.
   • Going Concern Statement: The director confirms ongoing group support and the use of the going concern basis in preparing accounts, suggesting management believes the company will continue operating despite current losses.

4. Due Diligence Notes:

   • Investigate the nature and terms of the amounts owed to group undertakings, including any plans for repayment or conversion to equity.
   • Review the company’s cash flow forecasts and management plans to address the large working capital deficit.
   • Assess the underlying business model and contracts to determine operational sustainability and revenue generation prospects.
   • Consider the financial health and creditworthiness of the parent company and ultimate controlling party to evaluate the reliability of group funding.
   • Verify whether there are any contingent liabilities or off-balance sheet obligations not reflected in the accounts.