FARRELL ELECTRICAL & PROPERTY SERVICES LTD

Executive Summary

Farrell Electrical & Property Services Ltd is a small, recently established electrical installation company showing early signs of balance sheet improvement but currently experiencing short-term liquidity stress. Credit exposure should be limited and conditional on close monitoring of cash flows and working capital management. The director’s hands-on control and business focus provide a degree of operational stability but the financial profile remains fragile at this stage.

FARRELL ELECTRICAL & PROPERTY SERVICES LTD - Analysis Report

Company Number: SC726247

Analysis Date: 2025-07-20 15:31 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   Farrell Electrical & Property Services Ltd is a very recently incorporated micro private limited company operating in electrical installation. The company shows a positive but modest net asset position (£1,407 in FY 2024, up from £13 the prior year), indicating some growth. However, it has negative net current assets (-£4,689) reflecting a working capital deficit. Given the small scale, early stage, and working capital pressure, credit should be extended cautiously with conditions such as monitoring of cash flow and receivables closely. The director’s sole control and experience as an electrician is a positive factor but limited financial track record calls for prudent limits and regular review.

2. Financial Strength:
   The balance sheet shows very low fixed assets (£7,527) and current assets (£32,818) against current liabilities of £37,507. The company has net current liabilities indicating short-term liquidity challenges. However, net assets have improved from £13 to £1,407 year-on-year, suggesting some accumulation of retained earnings or capital injection. Provisions and accruals are modest. Overall, the financial position is fragile but improving, typical for a micro entity in early growth.

3. Cash Flow Assessment:
   Negative net current assets imply that current liabilities exceed current assets, which could constrain operational liquidity. The company likely relies on tight working capital management and possibly director funding or short-term credit. The increase in employees from 2 to 3 suggests some operational expansion that may pressure cash flow further. Close attention should be given to debtor collection cycles and creditor payment terms to ensure ongoing liquidity.

4. Monitoring Points:

• Monthly cash flow and working capital trends to detect any worsening liquidity.
• Receivables aging and debtor concentrations.
• Timely filing of accounts and confirmation statements (currently up to date).
• Any changes in director or ownership, especially considering sole control by one individual.
• Profitability trends once profit & loss data becomes available to assess operational performance.
• Potential capital injections or external financing to relieve working capital deficits.