Company Number: NI677663

Analysis Date: 2025-07-29 20:10 UTC

1. Risk Rating: MEDIUM
   The company shows positive net current assets and a growing asset base but a notable decline in net assets year-on-year, coupled with significant director loans. These factors suggest moderate risk, mainly around capital erosion and reliance on director funding.

2. Key Concerns:

• Declining Net Assets: Net assets have decreased from £20,556 in 2021 to £13,904 in 2024, indicating accumulated losses or capital consumption.
• High Director Loan Exposure: The company has an interest-free, repayable-on-demand loan from the director totaling £51,053 as of 2024, which is material relative to net assets and may signal reliance on related-party funding.
• Large Accruals and Deferred Income: Accruals and deferred income nearly match total assets less current liabilities (approx. £62,031 vs. £75,935), which may affect liquidity and require further assessment.

3. Positive Indicators:

• Solid Working Capital Position: Net current assets improved significantly from £34,344 in 2023 to £61,145 in 2024, indicating better short-term liquidity.
• No Filing or Compliance Issues: The company is current with its accounts and confirmation statement filings, showing good regulatory compliance.
• Growing Fixed Assets and Employee Base: Fixed assets increased modestly, and average employees rose from 3 to 4, suggesting operational growth and investment.

4. Due Diligence Notes:

• Examine the nature and terms of the director’s loan, including any potential risks if the loan is called in or not renewed.
• Review detailed profit and loss accounts to understand causes of declining net assets and any recurring losses.
• Assess the composition and timing of accruals and deferred income to evaluate potential cash flow timing risks.
• Confirm the company’s revenue trends and client base stability given its specialized design consultancy industry classification.