Company Number: 12392040

Analysis Date: 2025-07-20 14:02 UTC

1. Credit Opinion: APPROVE with caution. DC Personnel Limited is an active small private limited company operating in employment placement services. The company shows a positive net asset position and reasonable working capital as of the last financial year end (March 2024). However, there is a significant increase in current liabilities compared to prior year, mainly due to a rise in taxation and social security creditors, which may indicate timing differences in payments or accruals. The director confirms going concern status, and there are no signs of director disqualifications or insolvency proceedings. Caution is advised due to the company's relatively short trading history (incorporated in 2020) and fluctuations in working capital, but overall financials support credit facility approval.

2. Financial Strength: The balance sheet shows net assets of £131,831 as at 31 March 2024, down from £182,452 in the prior year, primarily due to a dividend payment of £100,000. Fixed assets are minimal at £1,354, emphasizing reliance on current assets for liquidity. The company maintains positive retained earnings of £131,731. Current assets stand at £298,482, comprising mainly debtors (£288,365) and cash (£10,117), against current liabilities of £167,982. The significant increase in current liabilities (from £66,633 in 2023 to £167,982 in 2024) is noteworthy, especially the large taxation and social security creditors (£129,520). This may reflect accrued payroll taxes or VAT but should be monitored closely. Overall, the equity base is sound for a small enterprise, and there are no material concerns over solvency evident from the accounts.

3. Cash Flow Assessment: Cash at bank is modest (£10,117) but stable compared to prior year (£12,228). Debtors are substantial (£288,365), representing a large portion of current assets, which suggests that the company’s liquidity relies heavily on timely collection of receivables. The net current assets of £130,500 indicate positive working capital, but the rise in current liabilities, especially tax-related, could pressure short-term liquidity if not managed carefully. The company utilizes invoice discounting (advances against trade debtors), which can improve cash flow flexibility but also adds contingent risk if debtor payments are delayed. Given the business model (employment placement), cash flow can be cyclical, so careful monitoring of debtor aging and creditor payment terms is recommended.

4. Monitoring Points:

• Taxation and social security creditor levels should be reviewed regularly to ensure these obligations are met promptly and do not accumulate.
• Debtors aging profile and collection effectiveness given the high debtor balance relative to cash.
• Impact of dividends and distributions on retained earnings and capital reserves.
• Any changes in business volume or contract terms that might affect cash flow or asset quality.
• Continued compliance with filing deadlines and any changes in director status or company structure.
• Effectiveness of invoice discounting arrangements and related covenants or fees.