Company Number: 13004663

Analysis Date: 2025-07-20 14:20 UTC

1. Risk Rating: HIGH

The company presents significant solvency and liquidity risks, evidenced by large creditor balances far exceeding current assets and negative net assets, despite reporting a modest operating profit in the latest year.

2. Key Concerns:

• Negative Net Assets and Shareholders’ Deficit: Shareholders’ funds stand at approximately -£255k, indicating accumulated losses and a balance sheet deficit.
• Liquidity Mismatch: Current liabilities (£131,674) substantially exceed current assets (£3,473), resulting in a negative net current asset position of -£128,201, signaling potential short-term cash flow difficulties.
• Heavy Reliance on Long-Term Creditors: Significant non-current liabilities (£197,776) persist, with no indication of repayment plans or creditor support, raising questions about financial sustainability.

3. Positive Indicators:

• Increasing Turnover and Operating Profit: Turnover increased to £95,614 in 2023 from £27,455 in 2022, and the company reported a small operating profit (£2,128) in 2023 compared to a loss the prior year.
• Director’s Support and Control: The sole director holds 75-100% ownership and control, potentially facilitating swift decision-making and ongoing support.
• No Overdue Filings or Compliance Issues: Accounts and confirmation statements are up to date with no overdue filings or penalties noted.

4. Due Diligence Notes:

• Creditor Arrangements: Investigate the nature of creditors falling due after more than one year (£197,776), including repayment terms and any creditor support or agreements.
• Going Concern Assumptions: Review the basis and evidence supporting the director’s assertion of going concern despite negative net assets and significant liabilities.
• Cash Flow and Financing Sources: Examine detailed cash flow statements and financing arrangements to assess liquidity management and funding sustainability.
• Intangible Asset Valuation: Assess the intangible fixed asset (licenses and registration fees) of £70,202 to verify recoverability and impact on overall asset quality.
• Profitability Trends and Business Model: Validate revenue quality and cost structure improvements that led to the operating profit, and analyze prospects for continued operational stability.

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