Company Number: 14722248

Analysis Date: 2025-07-29 13:45 UTC

1. Credit Opinion: CONDITIONAL APPROVAL

Esteem Support Agency Ltd is a newly incorporated temporary employment agency with a full exemption small company filing status. The most recent accounts show a net current liability position (-£2,431) and negative shareholders' funds (-£2,432), indicating initial operating losses or start-up costs exceeding capital introduced. While this is not unusual for a first-year SME, the negative working capital and equity position present a risk to liquidity and solvency. The company's ability to service debt will depend heavily on generating positive cash flows going forward. Given that the business is active with no overdue filings and a single director/owner with full control, credit approval should be conditional on regular financial updates, including cash flow forecasts and monitoring of trade payables and receivables.

2. Financial Strength:

• Total current assets: £36,951 (comprised of £20,858 cash and £16,093 debtors)
• Total current liabilities: £39,382, leading to net current liabilities of £2,431
• Negative shareholders’ funds of £2,432 reflect accumulated losses or initial investments not yet recovered
• No fixed assets reported; the balance sheet is relatively simple and typical for a start-up SME
• The accounting treatment is consistent with FRS 102 small company regime and no audit was required

Overall, the balance sheet shows limited financial strength and a lack of buffer to absorb shocks. The company is reliant on short-term liquidity and ongoing cash inflows.

3. Cash Flow Assessment:

• Cash at bank is £20,858, which provides a modest liquidity cushion
• Debtors amount to £16,093, though a note shows trade debtors as negative (£9,919), suggesting possible credit balances or adjustments that require clarification
• Creditors due within one year total £39,382, including a large accrual for taxation and social security (£35,965)
• Negative net current assets indicate working capital deficit, raising concerns about the ability to meet short-term obligations without additional financing or improved cash conversion
• The director’s statement confirms going concern basis but no profit and loss account was presented, limiting visibility on operational cash generation

4. Monitoring Points:

• Track monthly cash flow reports to ensure sufficient liquidity to cover trade creditors and payroll-related liabilities
• Monitor ageing of debtors and creditors closely to prevent overdue balances and supplier disputes
• Review payroll tax and social security accruals for accuracy and timely payment
• Request interim management accounts to assess revenue growth and margin improvement over time
• Watch for any changes in director or ownership that might affect governance or financial controls