GRAHAM CLARK CARPENTRY LTD

Executive Summary

Graham Clark Carpentry Ltd is a very young micro-entity showing a significant decline in net assets and liquidity in its latest financial year, signaling operational and cash flow challenges. While current liabilities are covered and the business remains solvent, cautious credit extension with close monitoring is advised until financial stability improves. Directors' active control is a positive factor but the company’s financial trajectory warrants careful scrutiny.

GRAHAM CLARK CARPENTRY LTD - Analysis Report

Company Number: 13971849

Analysis Date: 2025-07-29 20:25 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   Graham Clark Carpentry Ltd is a micro-entity with a very recent incorporation date (March 2022) and limited operating history. The latest accounts show a sharp decline in net assets from £49,620 in 2023 to £6,415 in 2024, primarily due to a significant reduction in current assets and a slight decrease in fixed assets. While the company remains solvent with positive net current assets of £11,225, the drastic drop in equity signals potential operational or cash flow stress. The directors hold significant control and appear to be actively involved in the business, which is positive. Credit should be extended cautiously, possibly with limits and regular reviews, until further financial stability and growth can be demonstrated.

2. Financial Strength
   The balance sheet reflects a weakening financial position. Fixed assets decreased moderately (£11,732 to £8,799), and current assets dropped substantially (£109,227 to £18,635). Current liabilities also reduced but remain material at £7,410, leaving net current assets positive but much lower than the previous year. Long-term liabilities of £10,474 further reduce net assets. Shareholders’ funds have reduced by approximately 87% year on year, indicating retained losses or distributions exceeding profits. This weak equity base limits the company’s buffer against financial shocks.

3. Cash Flow Assessment
   The significant reduction in current assets, which likely includes cash and trade receivables, suggests tight liquidity in the latest year. Positive net current assets indicate the company can currently meet short-term obligations, but the large decline warrants monitoring. The company employs two people including directors, indicating a small operational scale with potentially limited cash inflows. The absence of a profit and loss statement limits insight into profitability and operating cash flow, but the erosion of equity suggests operating losses or cash outflows exceeding inflows.

4. Monitoring Points

• Track changes in working capital components, especially cash balances and trade receivables/payables.
• Monitor profitability and cash generation in future accounts to ensure the business can sustain itself.
• Watch for any increases in liabilities or delayed payments that could strain liquidity.
• Confirm directors’ ongoing involvement and any changes in ownership or control that might impact financial discipline.
• Review upcoming filings for updated financial performance and any notes on going concern status.