DIGITECH CREATIVE SOURCE LIMITED

Executive Summary

DIGITECH CREATIVE SOURCE LIMITED is a newly established small private company with positive but limited net assets and working capital. The financial position is solvent but fragile, with increasing receivables and payables that warrant close cash flow monitoring. Credit approval is recommended on a conditional basis with strict limits and ongoing review until a longer trading history is established.

DIGITECH CREATIVE SOURCE LIMITED - Analysis Report

Company Number: 14836201

Analysis Date: 2025-07-29 15:04 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   DIGITECH CREATIVE SOURCE LIMITED is a very young entity incorporated in May 2023. The company shows positive net current assets in both reported years, but the absolute values are modest (£832 in 2025, down from £1,066 in 2024). The limited scale and low asset base suggest constrained financial flexibility. The company has no employees other than the director, indicating a lean operation. The director is the sole significant controller with full voting rights and appointment power, pointing to clear management responsibility but also concentration risk. Given the limited operating history and small scale, credit approval should be conditional on ongoing financial monitoring and possibly limits on exposure until a more established trading record is developed.

2. Financial Strength:

• The balance sheet shows net assets of £832 as of 31 May 2025, down from £1,066 the prior year.
• Current assets (£3,844) exceed current liabilities (£3,012), providing positive working capital of £832.
• Debtors increased significantly from £648 to £3,219, indicating growth in receivables but raising potential collection risk.
• Cash decreased slightly from £668 to £625, reflecting tight liquidity.
• Shareholders’ funds align with net assets, showing no long-term debt or external equity.
  Overall, the financial position is solvent but fragile, with low capitalisation and limited retained earnings.

3. Cash Flow Assessment:

• Cash on hand is limited (£625), and working capital is positive but modest.
• Debtor concentration is high relative to cash, which could impact liquidity if collection delays occur.
• The increase in creditors from £250 to £3,012 suggests the company may be extending payment terms or accumulating trade payables, potentially stressing short-term liquidity.
• No employees implies low fixed costs but also limited operational scale.
  The company’s ability to service debt or absorb shocks depends heavily on timely collections and managing payables.

4. Monitoring Points:

• Receivables aging and collection efficiency to mitigate credit risk from rising debtors.
• Liquidity trends, especially cash flow sufficiency relative to payables and operational expenses.
• Profitability and turnover growth to assess business trajectory and debt servicing capacity.
• Any changes in ownership or management that could affect governance or financial discipline.
• Filing of future accounts and confirmation statements on time to ensure compliance and transparency.