Company Number: 12658948

Analysis Date: 2025-07-29 12:18 UTC

1. Risk Rating: HIGH
   The company exhibits significant financial distress evidenced by persistent and growing net liabilities exceeding £40,000 over multiple years, reaching £47,326 in the latest period. Current liabilities substantially exceed current assets, indicating severe liquidity constraints.

2. Key Concerns:

• Solvency Risk: Negative net assets and shareholders’ funds suggest the company is insolvent on a balance sheet basis and may struggle to meet obligations as they fall due.
• Liquidity Concerns: Current liabilities (£46,998) dwarfs current assets (£296), resulting in a negative working capital position of £46,702. This raises doubts about the company’s ability to cover short-term debts without additional financing.
• Operational Stability: The company has only two employees and minimal share capital (£10), with no evidence of profitability or positive retained earnings. Continued losses or lack of capital injection threaten business sustainability.

3. Positive Indicators:

• The company is up to date with statutory filings including accounts and confirmation statements, indicating regulatory compliance and governance discipline.
• There has been no indication of insolvency proceedings such as liquidation or administration, which suggests the company remains operational.
• The sole significant controller has maintained 75-100% ownership and control, providing clear decision-making authority.

4. Due Diligence Notes:

• Investigate the company's business model and revenue generation given the negative net assets and working capital deficit. Assess if there is a viable turnaround plan or ongoing financial support from the shareholder.
• Clarify the nature and maturity of current liabilities totaling nearly £47,000 to understand repayment obligations and creditor exposure.
• Review recent management actions since the director change in August 2024, including any financial restructuring or strategy shifts.
• Confirm the accuracy and completeness of financial data, especially given the micro-entity reporting exemption and unaudited accounts.
• Explore potential contingent liabilities or off-balance sheet risks not reflected in the accounts.