FUTURE OF WORK LTD

Executive Summary

Future Of Work Ltd has made a marked recovery with a positive net asset position and solid working capital, supporting its ability to meet short-term obligations. The company’s financial turnaround and capital injection underpin credit approval, though close monitoring of receivables and cash flow is advised. Management has maintained compliance and there are no red flags. Overall, the company presents a moderate credit risk with improving fundamentals.

FUTURE OF WORK LTD - Analysis Report

Company Number: 12752302

Analysis Date: 2025-07-20 13:10 UTC

1. Credit Opinion: APPROVE with monitoring conditions
   Future Of Work Ltd has shown a significant turnaround in financial position from a negative shareholders’ equity of £-269k in 2023 to a positive £134.9k in 2024. The company currently has strong net current assets of £131k, indicating good short-term liquidity to meet debt obligations. Despite a small share capital base, recent capital injections and improved debtor collections support repayment ability. However, the company operates in a competitive HR and IT services sector with a small employee base (3 average employees), so ongoing monitoring of cash flow and debtor quality is recommended. No adverse director conduct or filing issues are noted, reflecting sound management compliance.

2. Financial Strength:
   The balance sheet shows fixed assets of £3.5k, minimal but stable, and current assets of £255k largely driven by debtors (£190k) and cash (£65k). Current liabilities are moderate at £124k, resulting in a net working capital surplus of £131k. The company has reversed prior losses with retained earnings improving from £-270k to £-91k, and shareholders’ funds turning positive. The capital structure is predominantly equity with no long-term debt reported. This indicates a healthy solvency position and limited financial leverage, reducing risk in downturns.

3. Cash Flow Assessment:
   Cash at bank decreased from £88k to £65k, but is comfortably above current liabilities. The substantial increase in trade debtors to £149k (from £5.6k) warrants attention as it represents significant working capital tied up in receivables. Efficient collection of these debtors is critical for liquidity. The company’s net current assets position and positive equity suggest sufficient working capital buffer currently, but cash flow from operations should be closely monitored to ensure continued liquidity and timely creditor payments.

4. Monitoring Points:

• Debtor ageing and collection efficiency due to high receivables concentration.
• Retained earnings trajectory to confirm sustainable profitability and reserve rebuilding.
• Cash flow patterns relative to creditor payments to preclude liquidity squeeze.
• Any changes in share capital or funding arrangements that may affect capital structure.
• Sector market conditions impacting revenue generation given small employee base and niche service offering.