Company Number: 13550942

Analysis Date: 2025-07-29 15:53 UTC

1. Credit Opinion: DECLINE
   Harper Moore Search Ltd exhibits weak financial health with marginal net assets (£41) and negative net current assets (-£2,993) as of August 2024. The company’s liquidity position is precarious, with no cash holdings and a significant director’s loan (£37,772) constituting the majority of debtors. Current liabilities have more than tripled year-on-year, primarily driven by increased corporation tax and bank loans, raising concerns about the company's ability to meet short-term obligations. The trend shows a sharp decline from previous years’ net assets (£2,095 in 2023 to £41 in 2024) and worsening working capital, indicating deteriorating financial stability. The company’s reliance on director loans and absence of free cash undermines confidence in its debt servicing capacity. Without clear evidence of improved cash flow generation or reduced liabilities, extending credit would carry high risk.

2. Financial Strength:
   The balance sheet is fragile. Fixed assets are minimal (£3,746) and largely depreciated. Current assets are almost entirely made up of debtors, with no cash reserves, which is problematic given the quick turnaround needed to cover current liabilities of £62,700. The negative net current assets position highlights a working capital deficit, signaling potential liquidity stress. Shareholders’ funds are nominal (£100 share capital) and the accumulated losses reflected in the negative profit and loss reserve (-£59) further weaken equity. The company’s financial trajectory is negative, with net assets declining sharply over two years, indicating erosion of capital base and possible ongoing losses.

3. Cash Flow Assessment:
   Cash flow appears constrained. The company holds no cash at year-end and relies heavily on director loans to finance operations, which although unsecured and repayable on demand, represent a contingent risk. The substantial increase in bank loans and corporation tax liabilities, without corresponding cash or liquid assets, suggests poor operational cash generation. Negative working capital and increased creditors indicate potential difficulties in meeting short-term commitments promptly. The lack of an audit and reliance on compiled accounts also limits assurance on cash flow quality.

4. Monitoring Points:

• Monitor liquidity ratios closely, particularly current ratio and quick ratio, to detect further deterioration.
• Track changes in director’s loan account balances and bank borrowing levels as these significantly impact solvency.
• Watch corporation tax liabilities and payment patterns, as rising tax debts may signal profitability or cash flow issues.
• Review upcoming filings for turnover and profitability trends to assess if operational improvements materialize.
• Assess management’s plans for restoring positive working capital and generating sustainable cash flow.