Company Number: 14410025

Analysis Date: 2025-07-20 18:36 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   DEACOLEC LTD is a micro-entity operating in electrical installation with a very recent incorporation date (Oct 2022). The company has shown improvement from a negative net asset position of £(1,429) in 2023 to a marginal positive net asset of £3 in 2024. However, it still reports net current liabilities (£6,071 in 2024) indicating working capital shortage. Given the limited trading history, low asset base, and negative working capital, credit approval should be conditional on strict monitoring of cash flow and receivables. The limited scale of operations (one employee) and micro-entity reporting means financial data is sparse. The director’s full ownership and control suggest simple governance but also concentration risk.

2. Financial Strength:

• Fixed assets are minimal and unchanged at £6,074, indicating limited investment in long-term resources.
• Current assets increased from £4,696 to £13,762, a positive sign potentially reflecting higher cash or receivables.
• Current liabilities rose from £12,199 to £19,833, outpacing current assets growth and resulting in net current liabilities of £6,071.
• Shareholders funds moved from negative (£1,429) to slightly positive (£3), showing marginal improvement in net worth but effectively zero equity buffer.
  Overall, the balance sheet remains very weak with negative working capital and minimal equity base, suggesting vulnerability to cash flow shocks or creditor pressure.

3. Cash Flow Assessment:
   The company’s net current liabilities indicate potential liquidity challenges. The increase in current assets is encouraging but insufficient to cover rising short-term creditor obligations. With no profit and loss accounts filed, cash generation cannot be directly assessed, but the lack of audit or detailed financial disclosures limits insight. The single employee and micro nature imply low overheads, which may reduce cash burn. Close attention to cash inflows, debtor collection, and creditor terms is essential for ongoing viability.

4. Monitoring Points:

• Working capital levels and trends, especially current assets vs current liabilities.
• Cash flow statements or management accounts to verify liquidity improvements.
• Timely filing of next accounts and confirmation statements to ensure compliance.
• Any change in director or ownership structure that could impact control or financial support.
• Evidence of growing revenues or contracts in the electrical installation sector to support cash generation.