Company Number: 13889645

Analysis Date: 2025-07-20 18:36 UTC

1. Risk Rating: HIGH
   Justification: The company has reported a significant deterioration in its net assets and working capital position as of 31 March 2024, moving from positive net assets of £120,855 in 2023 to a negative £23,420 in 2024. Net current assets turned negative by £56,615, indicating liquidity stress. The directors’ report notes a loss for the year and reliance on continued financial support to maintain going concern status, signaling solvency and operational risks.

2. Key Concerns:

• Negative Net Assets and Working Capital: The shift from positive equity and working capital in 2023 to negative values in 2024 highlights financial distress and potential inability to meet short-term obligations without external support.
• Reliance on Directors’ Financial Support: The directors acknowledge losses and a deficit in shareholders’ funds but indicate they will continue to provide financial support, suggesting the business is not self-sustaining.
• High Current Liabilities Relative to Current Assets: The current liabilities (£236,869) exceed current assets (£180,254), primarily trade creditors and finance lease obligations, increasing liquidity risk.

3. Positive Indicators:

• No Overdue Filings: The company has complied punctually with filing deadlines for accounts and confirmation statements, indicating regulatory compliance and governance adherence.
• Experienced and Stable Management Team: Three directors have been in place since incorporation, each holding significant shareholding and control, which may support coordinated strategic decision-making.
• Growth in Employee Numbers: The average number of employees increased from 5 to 9 in the latest year, suggesting business expansion efforts despite financial difficulties.

4. Due Diligence Notes:

• Review the company’s management accounts and cash flow forecasts post-March 2024 to assess current liquidity and operational performance.
• Investigate the nature and terms of directors’ financial support, including any formal agreements or guarantees, and the sustainability of this support.
• Assess the reasons behind the significant reduction in debtors and cash balances from 2023 to 2024 and whether this reflects collection issues or changes in trading patterns.
• Examine the contract pipeline and revenue recognition policies given the SIC code (agents involved in sale of goods) and the company’s description as an interior fit-out provider to understand business model sustainability.
• Confirm no director disqualifications or governance issues beyond available data.