Company Number: 13953340

Analysis Date: 2025-07-20 14:51 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   DIORITE CONSULTANCY LIMITED is an active private limited company operating in IT consultancy with a micro-sized reporting category. The company shows positive net assets and shareholder funds increasing slightly from £3,934 to £4,773 over two years, indicating modest growth. However, the company consistently reports net current liabilities (negative working capital) of around £7,600 to £8,500, reflecting short-term liquidity pressure. The director is also the sole significant controller, which concentrates management control but shows stable governance. Approval is conditional on monitoring liquidity improvement and ensuring timely payments to short-term creditors.

2. Financial Strength:
   The company’s fixed assets remain stable at £12,434, while current assets increased significantly to £30,221 in 2024 from £4,329 in 2023, suggesting an improvement in assets convertible to cash or receivables. Despite this, current liabilities have also grown to £37,882, resulting in net current liabilities of £7,661, a concern as it implies insufficient short-term assets to cover immediate liabilities. The total net assets are positive but low (£4,773), consistent with a micro entity in early growth. The balance sheet shows a fragile financial position with reliance on short-term funding or credit facilities.

3. Cash Flow Assessment:
   Negative net current assets highlight working capital pressures. The increase in current assets could be due to higher receivables or cash balances, which is positive if collectible, but the rise in current liabilities suggests growing short-term obligations. No profit and loss statement is available, so actual cash generation from operations cannot be verified. The company’s ability to meet short-term debt depends on the collectability of current assets and effective cash management. Liquidity risk is a key concern, necessitating close scrutiny of payment cycles and creditor terms.

4. Monitoring Points:

• Monitor liquidity ratios (current ratio and quick ratio) closely each reporting period.
• Track accounts receivable aging and cash conversion cycles to confirm asset liquidity.
• Watch creditors’ balances and payment behavior to avoid overdue debts.
• Assess any changes in director/shareholder structure or financial support from the owner.
• Review future filings for profit and loss data to evaluate operational cash generation.