Company Number: SC711160

Analysis Date: 2025-07-20 18:25 UTC

1. Credit Opinion: DECLINE
   Force Taekwon-Do Ltd’s financial position presents concerns from a credit perspective. The company shows persistently negative net current assets, indicating a working capital deficit, and a minimal net asset base (£78 in 2024) which suggests very limited equity buffer. The latest year also reveals a significant increase in current liabilities relative to current assets, worsening liquidity. Given this fragile balance sheet and absence of substantial fixed assets or cash reserves, the company appears unable to reliably service additional debt or credit obligations without external support.

2. Financial Strength:
   The company is classified as a micro-entity, operating with very modest asset levels. Fixed assets have slightly increased but remain immaterial (£1,823). Current assets increased to £11,253 in 2024, but current liabilities rose disproportionately to £12,998, resulting in net current liabilities of £1,745. Total net assets have decreased sharply from £654 in 2023 to £78 in 2024. This erosion of net assets and ongoing working capital deficit highlights weak financial strength and limited capacity to absorb financial shocks.

3. Cash Flow Assessment:
   The negative working capital position indicates potential liquidity strains. The company’s current liabilities exceed current assets, implying possible difficulties in meeting short-term obligations. There is no indication of cash reserves or liquid assets sufficient to cover these liabilities. The constant average employee count of one suggests limited payroll commitments, but without detailed cash flow statements, it is prudent to assume tight liquidity. This situation may be exacerbated if receivables are slow to collect or if payables are accelerated.

4. Monitoring Points:

• Monitor changes in current liabilities closely, especially any growth exceeding current assets.
• Track net asset trends to assess if the company rebuilds equity or continues erosion.
• Review cash flow statements when available to evaluate actual liquidity and operational cash generation.
• Keep an eye on the director’s ability to inject capital or provide guarantees given sole ownership and control.
• Watch for late filings or overdue accounts that may indicate operational or financial distress.