EFFECTFUL TECHNOLOGIES LTD

Executive Summary

Effectful Technologies Ltd is a micro-entity with severely reduced net assets and minimal operational scale, presenting a high credit risk due to its limited liquidity and financial strength. The company’s current financial position and lack of employees suggest insufficient capacity to service new credit facilities. Continuous monitoring of liquidity and business activity is essential if reconsideration is warranted.

EFFECTFUL TECHNOLOGIES LTD - Analysis Report

Company Number: 12509706

Analysis Date: 2025-07-29 12:08 UTC

1. Credit Opinion: DECLINE
   Effectful Technologies Ltd demonstrates a very weak financial position with minimal current assets (£3,313) and no current liabilities as of the latest accounts. The company is micro-sized and shows a significant erosion of net assets from £7,123 in 2023 to £3,314 in 2024. The operating scale is extremely small with no employees currently, suggesting limited business activity and likely insufficient cash flow to service debt or support credit facilities. The lack of audit and very modest financial scale reduce transparency and increase risk. Overall, the company does not show the financial robustness or management scale needed to confidently support new credit.

2. Financial Strength:
   The balance sheet is extremely lean with total net assets of £3,314. Current assets have dropped by more than 50% year-on-year, indicating shrinking liquidity or asset base. There are no fixed assets reported, and no current liabilities, meaning the company has limited operational scale. Shareholders’ funds have been reduced by over 50% compared to the prior year. The company’s micro-entity status and minimal capital (£1) reflect very low capitalization and fragile equity. This weak financial base suggests poor financial strength and limited buffer to absorb downturns.

3. Cash Flow Assessment:
   With current assets of just £3,313 (likely cash or receivables) and zero current liabilities, the company has limited working capital but no immediate short-term obligations. However, the sharp decline in current assets and the absence of employees raise concerns about ongoing cash generation capacity. The absence of disclosed income or profitability data and the small scale indicate very limited operational cash flow. This low liquidity position is insufficient to support credit without immediate risk of default if unexpected expenses arise.

4. Monitoring Points:

• Track quarterly cash balances and any changes in current assets to detect further liquidity erosion.
• Monitor for any increase in current liabilities or overdraft usage that could signal cash flow stress.
• Review any changes in ownership or director appointments that may affect governance and financial control.
• Watch for filing of full accounts or audited financial statements for more comprehensive insight.
• Monitor business activity levels or contract wins that could improve financial trajectory.