Company Number: 12940408

Analysis Date: 2025-07-20 13:12 UTC

1. Risk Rating: HIGH

The company shows significant solvency risk evidenced by persistent and growing negative net assets (shareholders' funds) over four years, reaching -£141,014 in 2023. The large amount of creditors falling due after more than one year (£1,000,829) greatly exceeds current assets and net assets, indicating heavy long-term liabilities. Although net current assets are positive due to a large cash or receivables position, the net liabilities after long-term creditors suggest the company may struggle to meet all obligations.

2. Key Concerns:

• Persistent negative net assets and increasing long-term liabilities suggest worsening solvency and potential balance sheet stress.
• The company has only one employee (the director), which may raise concerns about operational capacity and sustainability.
• Absence of audit and limited disclosure due to micro-entity status restricts transparency, making it difficult to fully assess financial health and risks.

3. Positive Indicators:

• The company is compliant with filing deadlines for both accounts and confirmation statements, indicating good regulatory compliance.
• Net current assets remain strongly positive (£826,912 in 2023), suggesting good short-term liquidity and working capital management.
• The director has held the position since incorporation, which may imply stable leadership.

4. Due Diligence Notes:

• Investigate the nature and terms of the substantial long-term creditors (£1 million+), including repayment schedules and covenants.
• Review cash flow statements and bank facilities to assess actual liquidity beyond balance sheet figures.
• Understand the business model and revenue streams given the very small workforce and the increasing scale of liabilities.
• Explore any contingent liabilities or related party transactions that may impact solvency.
• Assess the adequacy of internal controls and financial reporting given the exemption from audit.