DAVIDSON TRAINING SOLUTIONS LTD

Executive Summary

Davidson Training Solutions Ltd exhibits a strong and improving financial position with solid liquidity and asset growth, supporting its operational sustainability. While no regulatory compliance issues are apparent, the concentration of ownership and increased current liabilities warrant ongoing monitoring. Further due diligence on related party balances and tax liabilities is recommended to fully assess risk exposure.

DAVIDSON TRAINING SOLUTIONS LTD - Analysis Report

Company Number: 13027772

Analysis Date: 2025-07-20 13:39 UTC

1. Risk Rating: LOW
   Davidson Training Solutions Ltd demonstrates a solid financial position with strong net assets, positive net current assets, and substantial cash holdings. The absence of overdue filings and the company's active status further support a low risk of insolvency or regulatory issues.

2. Key Concerns:

• Concentration of Control: 75-100% ownership and control by a single director poses governance concentration risk.
• Significant Increase in Creditors: Current liabilities more than doubled year-on-year, primarily taxation and social security liabilities, which merits monitoring for cash flow impact.
• Related Party Debtors: Substantial amounts owed by group undertakings (£780k) create potential exposure if intercompany balances are not settled timely.

3. Positive Indicators:

• Strong Financial Position: Net assets increased from £995k (2022) to £1.46m (2023) with positive working capital of £435k.
• Robust Liquidity: Cash holdings grew to £926k, representing a comfortable buffer against current liabilities.
• No Overdue Filings: Accounts and confirmation statements are filed on time with no penalties or compliance issues noted.
• Growing Asset Base: Fixed assets increased to £1.11m indicating investment in tangible resources, which supports operational sustainability.
• Substantial Employee Growth: Average headcount rose from 1 to 52, suggesting business expansion.

4. Due Diligence Notes:

• Review the nature and recoverability of the £780k intercompany debtor balance to assess liquidity risk.
• Investigate reasons behind the sharp increase in taxation and social security liabilities (£620k) to confirm whether these are timing issues or indicative of underlying cash flow stress.
• Assess governance practices given the single-person control structure and evaluate any related party transactions for potential conflicts of interest.
• Confirm the valuation and impairment testing of the significant fixed assets (£1.1m) to ensure they are fairly stated.
• Verify employee-related commitments, including pension scheme contributions and any contingent liabilities not disclosed.