Company Number: 13033484

Analysis Date: 2025-07-29 14:52 UTC

1. Risk Rating: HIGH
   The company exhibits a significant deterioration in net current assets and shareholders’ funds, moving from positive equity of £16,702 in 2022 to negative equity of approximately £19,000 in 2023. This signals solvency challenges and potential inability to meet liabilities.

2. Key Concerns:

• Negative Net Current Assets and Shareholders’ Funds: The net current liabilities of £18,941 as of November 2023 indicate liquidity pressure. The drop from a positive working capital position in prior years is a red flag for operational cash flow stress.
• High Debtors Relative to Cash: Debtors increased substantially to over £2.6 million while cash reserves dropped dramatically to just £16,075, suggesting potential collection issues or concentration risk on receivables.
• Reliance on a Single Director and Owner: Mr. Richard John Walters holds 75-100% ownership and is the sole director, which concentrates control and may limit governance oversight and risk diversification.

3. Positive Indicators:

• Current Filing and Compliance: The company’s accounts and confirmation statement filings are up to date with no overdue returns or penalties noted, indicating compliance with statutory requirements.
• Established Credit Granting SIC Codes: The company operates in a specialized consumer credit granting sector, which can be profitable if managed well, and it is registered as a private limited company, limiting liability to shareholders.
• Going Concern Statement: The director affirms the company is a going concern, suggesting confidence in short-term survival despite financial challenges.

4. Due Diligence Notes:

• Investigate Debtor Quality and Collection Risks: The large increase in debtors should be analyzed for aging, concentration, and recoverability to assess liquidity risk.
• Examine Creditor Composition: Understanding the nature and terms of £2.65 million current liabilities is critical to evaluate payment obligations and potential refinancing or restructuring needs.
• Review Director’s Strategy and Financial Plans: Given the negative equity and sole director control, review any plans to restore solvency, capital injection intentions, or operational changes.
• Assess External Funding or Guarantees: Check for any external financial support or guarantees that may mitigate risk.