Company Number: 14120225

Analysis Date: 2025-07-29 20:18 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   Exalto Consulting Limited is a recently established private limited company (incorporated May 2022) operating in the temporary employment agency sector. The company demonstrates positive net current assets and equity, indicating a basic level of financial stability. However, the equity value declined from £78,687 at 2023 year-end to £57,986 at 2024 year-end, suggesting some pressure on retained earnings or increased liabilities. The current liabilities increased significantly from £414,503 to £671,617 over the same period, which raises concerns about short-term obligations and working capital management. Given these factors, credit approval should be conditional on ongoing monitoring of liquidity and profitability to ensure the company can meet its debt servicing requirements.

2. Financial Strength:

• Shareholders' funds remain positive but have decreased by approximately 26% over the last year (£78,687 to £57,986), indicating reduced net assets or accumulated losses.
• Tangible fixed assets are minimal (£1,099), implying the business is not asset-heavy and likely relies on working capital and cash flow for operations.
• Current assets rose from £491,926 to £728,504, primarily due to increased cash and debtors.
• However, current liabilities rose sharply to £671,617 from £414,503, reducing net current assets to £56,887 (down from £77,423). This could indicate increased creditor balances or tax/social security obligations that require attention.

3. Cash Flow Assessment:

• Cash balances are strong and increased from £381,724 to £553,340, which is a positive liquidity indicator.
• Debtor balances increased moderately, suggesting the company might be extending more credit to clients or experiencing slower collections.
• The higher current liabilities, especially tax and social security creditors (£178,611), could pressure short-term cash flow if not managed prudently.
• Net current assets remain positive but have declined, signaling tightening working capital conditions that require close monitoring.

4. Monitoring Points:

• Track evolution of current liabilities, especially tax and social security liabilities, to avoid liquidity strain or compliance issues.
• Monitor debtor collection periods closely to ensure cash inflows remain sufficient to cover short-term obligations.
• Watch retained earnings and profitability trends to confirm the company is building equity rather than eroding it.
• Review directors' management actions on working capital efficiency and cost controls.
• Given the company is young and growing, monitor credit exposure limits carefully against cash flow generation.