Company Number: OC441010

Analysis Date: 2025-07-20 17:15 UTC

1. Credit Opinion: APPROVE with conditions DOWSE & CO SOLICITORS LLP is a relatively new LLP incorporated in 2022, with its first full year of accounts to March 2024. The firm demonstrates a positive net asset position and manageable levels of debt. While no profit and loss data is disclosed, the balance sheet and working capital figures suggest the company can meet short-term obligations. The members have provided capital and loans, which rank as secured creditors, improving creditor protection. However, given the limited trading history and absence of audited accounts, credit approval should be conditional on ongoing monitoring of cash flows and profitability trends.

2. Financial Strength:

• Net assets stand at £283k as of March 2024, down slightly from £307k the prior year, reflecting a modest reduction but still a solid equity base for an LLP of this size.
• Tangible fixed assets are modest at £10.8k, with no impairment concerns noted.
• The company holds stocks valued at £34k and debtors at £99k, indicating ongoing client work in progress and receivables.
• Current liabilities reduced from £139k to £95k, improving net current assets to £289k, which evidences a good working capital buffer.
• Long-term bank loans decreased from £26.7k to £16.7k, demonstrating some debt repayment.
• Loans due to members total £7.5k within one year and £275.5k thereafter, indicating reliance on member financing. Overall, the balance sheet shows a stable financial foundation with no significant red flags.

3. Cash Flow Assessment:

• Cash at bank decreased from £296k to £251k, a reasonable reduction given operational needs.
• Trade debtors declined significantly from £39k to £7.6k, possibly reflecting improved collections or billing timing.
• Other debtors are steady at £91k.
• Current liabilities decreased, which supports a healthier short-term liquidity position.
• Operating lease commitments remain substantial (£213k), representing a fixed cost that requires consistent cash generation.
• The firm’s liquidity position appears sufficient to meet near-term obligations but should be monitored for any cash flow strain given member loans and lease commitments.

4. Monitoring Points:

• Profitability data is not available; assess future accounts for earnings sustainability.
• Monitor cash flow closely, especially in relation to lease expenses and member loan repayments.
• Track debtor collection efficiency and ageing to avoid liquidity issues.
• Observe any changes in member loans and capital contributions, as heavy reliance on member funding could pose risks.
• Ensure timely filing of future accounts and confirmation statements to maintain compliance and transparency.
• Watch for any increases in liabilities or reductions in net assets that may indicate financial stress.