Company Number: 13827155

Analysis Date: 2025-07-20 12:49 UTC

1. Risk Rating: HIGH
   Emerald Productions Limited exhibits significant solvency and liquidity concerns as evidenced by persistent negative net current assets and shareholders’ funds over the last two years. The company is a micro-entity with minimal asset base and growing liabilities, indicating financial stress.

2. Key Concerns:

• Negative Net Current Assets: The company reported net current liabilities of £35,231 as of 31 March 2024, worsening from £31,465 the prior year, signaling inability to cover short-term obligations with current assets.
• Negative Shareholders’ Funds: Consistently negative equity balances (approx. -£35k), indicating accumulated losses or undercapitalization, which could impair financial stability.
• Single Director and Shareholder Control: The sole director is also controlled 75-100% by Lakshmi Inc Ltd, which may concentrate control but also raises questions about external oversight and governance robustness.

3. Positive Indicators:

• Timely Filing Compliance: The company is up to date with both accounts and confirmation statement filings, reducing regulatory compliance risk.
• Active Status: The company is active and not under liquidation or administration, suggesting ongoing operations.
• Micro-Entity Status: Simplified reporting requirements reduce administrative burdens and costs, potentially allowing focus on core business.

4. Due Diligence Notes:

• Review detailed cash flow statements and creditor aging to assess liquidity pressures and payment history.
• Investigate reasons for persistent negative equity and whether there are plans to recapitalize or restructure liabilities.
• Evaluate the nature of control by Lakshmi Inc Ltd and any related party transactions or guarantees that support the company financially.
• Confirm operational viability given only one employee and the nature of sound recording/music publishing activities, including revenue streams and client contracts.
• Assess director’s track record and any potential conflicts of interest given sole directorship and ownership.