Company Number: 13031897

Analysis Date: 2025-07-29 16:41 UTC

1. Risk Rating: MEDIUM
   The company maintains positive net assets and net current assets, indicating solvency on paper. However, there is a significant reduction in current assets and net assets from 2022 to 2023, which raises concerns about operational liquidity and sustainability.

2. Key Concerns:

• Decline in Current Assets: Current assets dropped sharply from £96,494 in 2022 to £19,603 in 2023, suggesting potential challenges in cash flow or collection of receivables.
• Reduced Net Assets: Net assets decreased from £29,313 in 2022 to £17,524 in 2023, indicating a weakening equity base.
• Rapid Increase in Employees: Average employees jumped from 2 in 2022 to 35 in 2023, which could strain cash flow if not matched by revenue growth or efficient cost management.

3. Positive Indicators:

• Solvent Position: The company has net current assets of £11,409 and positive shareholders’ funds of £17,524 as of the latest accounts, indicating the ability to meet short-term liabilities.
• No Overdue Filings: Accounts and confirmation statements are filed on time, showing regulatory compliance and governance diligence.
• Stable Fixed Assets: Fixed assets have increased slightly, demonstrating some investment in operational capacity.

4. Due Diligence Notes:

• Investigate the cause of the substantial reduction in current assets and whether this reflects lower cash balances, reduced receivables, or inventory depletion.
• Review the company’s revenue trends and profitability to assess whether the increase in staff aligns with business growth or if it is a cost pressure risk.
• Confirm the nature of current liabilities and whether any short-term debts are approaching maturity that could impact liquidity.
• Evaluate the quality of financial controls and management reporting given the rapid operational scaling.