FP - YNSECT II LLP

Executive Summary

FP - Ynsect II LLP exhibits a solvent but highly illiquid financial position with net assets tied up in unlisted investments and negligible cash. While currently free of liabilities, the lack of trading income and operational cash flow raises concerns about its ability to service debt. Credit approval is recommended only on a conditional basis, pending further clarity on cash flow generation and investment realizability.

FP - YNSECT II LLP - Analysis Report

Company Number: OC437804

Analysis Date: 2025-07-20 13:29 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   FP - Ynsect II LLP is an active UK limited liability partnership incorporated in 2021. The latest filed accounts (year ending 31 March 2024) show a clean balance sheet with total assets of £1.32 million and no liabilities. However, the entity holds its assets entirely in unlisted investments and has negligible cash (£137), with no reported turnover or employees. The absence of trading activity and reliance on investments may constrain cash flow generation, increasing risk for debt servicing. Credit approval is recommended conditionally, subject to further verification of income streams, liquidity sources, and the business plan supporting repayment capacity.

2. Financial Strength:
   The LLP’s balance sheet is simple and solvent, with net assets of approximately £1.32 million, consisting entirely of unlisted investments valued at the same amount as the previous year. There are no current or long-term liabilities reported, indicating no financial leverage or external debt burden. Members’ capital stands at £1.37 million with a small negative reserve of £55,489, which is not unusual for an early-stage entity. The financial position is stable but illiquid given the investment-heavy asset base and minimal cash holdings.

3. Cash Flow Assessment:
   Cash at bank is minimal, at only £137, indicating very limited liquid resources. The LLP has no reported employees and has opted not to disclose profit and loss accounts, suggesting limited or no trading income. The working capital position is positive but entirely tied to non-liquid investments. This structure implies the LLP’s ability to meet short-term obligations or service debt depends on either liquidation of investments or capital injections rather than operating cash flow. This weak liquidity profile is a key risk factor.

4. Monitoring Points:

• Confirm the nature and realizability of the unlisted investments, including valuation methods and marketability.
• Monitor cash flow developments and any new income streams or trading activity.
• Watch for any changes in liabilities or increased borrowing that may impact financial flexibility.
• Review future filings, especially profit and loss disclosures and cash flow statements for evidence of operational sustainability.
• Assess management actions regarding liquidity management and capital structure adjustments.