Company Number: 12903599

Analysis Date: 2025-07-20 11:54 UTC

1. Risk Rating: HIGH
   The company’s financial position shows a clear deterioration with net liabilities of £8,675 at the 2023 year-end, down from net assets of £5,982 in 2022. The current liabilities far exceed current assets, and there is a significant director loan liability, indicating solvency and liquidity concerns.

2. Key Concerns:

• Negative Net Assets & Shareholders’ Funds: The company moved from modest positive equity in 2022 to a net deficit in 2023, suggesting losses or withdrawals that have eroded capital.
• High Director Loan Liability: The company owes £212,054 to directors, a substantial long-term liability that raises questions about external financing and the company’s ability to repay this amount.
• Minimal Current Assets vs. Current Liabilities: Current liabilities of £1,261 against current assets of only £5,761 with cash of £4,311 indicates tight liquidity and limited buffer for operational needs.

3. Positive Indicators:

• Stable Investment Property Asset Base: Investment property at fair value increased slightly to £198,879, representing a tangible fixed asset underpinning the business.
• No Overdue Filings: Accounts and confirmation statement are filed on time, indicating good compliance with statutory requirements.
• No Employees: Zero employees reduce wage liabilities and operational cost burdens, which may be consistent with the company’s business model as a property holding entity.

4. Due Diligence Notes:

• Investigate the nature and terms of the director loans: Are these formalized loans with repayment schedules or informal advances? What is the risk of these being called in?
• Review the profit and loss account (not filed publicly) to understand the drivers behind the equity decline, including any operational losses, impairments, or extraordinary expenses.
• Understand the company’s cash flow cycle and income sources from the investment property to assess whether it can service its liabilities and the director loans.
• Confirm whether there are any contingent liabilities or off-balance sheet obligations not disclosed in the accounts.
• Assess the market conditions for the investment property to gauge the stability of the asset’s value and income-generating potential.