DAP CONSULTING LIMITED

Executive Summary

Dap Consulting Limited is a small, active management consultancy showing stable liquidity and positive net assets but with a slight decline in equity due to a deficit and dividends. The company can meet short-term liabilities, but its thin capital base and recent negative earnings warrant conditional credit approval with ongoing monitoring of profitability and cash flow. Continued prudent financial management is essential to maintain creditworthiness.

DAP CONSULTING LIMITED - Analysis Report

Company Number: 13294331

Analysis Date: 2025-07-20 12:48 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   DAP Consulting Limited operates in management consultancy and shows a modest but stable financial position. The company has positive net current assets and shareholders’ funds, suggesting an ability to meet short-term obligations. However, the small scale of operations and a slight decline in net assets from £6,910 to £5,730 within the last year, coupled with a small deficit and dividend payments, indicate caution. Approval is recommended with conditions that cash flow and profitability be closely monitored to ensure continued debt servicing capability.

2. Financial Strength:
   The balance sheet reflects a small private limited company with minimal fixed assets (not disclosed, assumed negligible) and a focus on liquidity. Shareholders’ funds decreased from £6,910 in 2023 to £5,730 in 2024, primarily due to a deficit of £180 and dividends of £1,000 paid out, indicating earnings absorption and shareholder withdrawals pressured equity. Current liabilities increased slightly to £4,828 but remain covered by current assets (cash at bank of £10,558). The company’s small share capital (£1) and retained earnings suggest a very lean capital base, consistent with a micro or small entity.

3. Cash Flow Assessment:
   Cash balances remain stable around £10,500, exceeding current liabilities by a comfortable margin, resulting in net current assets of £5,730. This indicates satisfactory liquidity and working capital to cover short-term debts. However, given the company's small scale and the absence of employees (average zero employees in the latest year), cash inflows may be dependent on the director’s consultancy engagements. The dividend payment despite a reported deficit signals potential stress on cash reserves if profitability does not improve.

4. Monitoring Points:

• Monitor profitability trends closely, as the small deficit and dividend payments have eroded reserves.
• Watch working capital ratios to ensure current assets continue to exceed current liabilities comfortably.
• Review director’s remuneration/dividends policy to avoid further depletion of capital reserves.
• Observe any changes in client base or contract size that could impact revenue stability.
• Ensure timely filing of accounts and confirmation statements to avoid compliance risks.