Company Number: 13603183

Analysis Date: 2025-07-19 13:04 UTC

1. Credit Opinion: DECLINE
   Illuminate Candle Ltd exhibits significant negative net assets and net current assets, with worsening liquidity from 2023 to 2024. The company is a micro-entity limited by guarantee, with no share capital and only one employee, suggesting limited operational scale and financial flexibility. Its liabilities exceed its assets by a materially negative amount (£16,706 net liabilities in 2024), indicating insolvency from an accounting perspective. This raises substantial doubt over its ability to meet debt obligations or honor commercial agreements without external support or capital injection.

2. Financial Strength:
   The balance sheet reveals persistent negative net assets over four years, deteriorating from -£10,532 in 2023 to -£16,706 in 2024. Current liabilities exceed current assets by £16,076, indicating poor working capital management and an inability to cover short-term obligations. The absence of share capital (limited by guarantee structure) limits the capacity for equity financing. Overall, the financial position is weak, reflecting ongoing losses or deficits not offset by reserves.

3. Cash Flow Assessment:
   Current assets are low (£9,110 in 2024) and insufficient to cover current liabilities (£25,612), suggesting liquidity constraints. The company’s negative net current assets imply it may struggle to fund day-to-day operations or service debt without external cash injections. The small scale (micro-entity, one employee) suggests limited cash inflows from operations or sales. No indication of cash or equivalents large enough to alleviate liquidity risks.

4. Monitoring Points:

• Monitor changes in net current assets and net liabilities for any improvement.
• Watch for timely filing of accounts and confirmation statements to ensure compliance and transparency.
• Observe any capital infusion or restructuring efforts due to the ongoing negative equity position.
• Evaluate operational cash flow generation and debtor collections closely if credit facilities are considered.
• Keep track of director or member commitments to support the company financially given the guarantee structure.