INFOAKTIV LTD

Risk Rating: HIGH Justification: INFOAKTIV LTD exhibits persistent balance sheet insolvency, with negative net assets in every reported year since 2020. Additionally, the company suffers from a severe working capital deficit, as current liabilities substantially exceed current assets. The company's continued operation relies heavily on creditor forbearance, which is a significant financial vulnerability.

Key Concerns: * Balance Sheet Insolvency: The company has negative net assets/shareholders' funds of £-27,592 as of 31 December 2025. Total liabilities (£55,841) significantly exceed total assets (£31,134). A consistently negative equity position indicates that the company is technically insolvent and cannot self-sustain without external support. * Severe Liquidity Shortfall: Net current liabilities stand at £-24,752. Current assets of £31,089 are vastly insufficient to cover creditors falling due within one year (£55,841). This presents a material liquidity risk should any short-term creditor demand immediate payment. * Dependence on Creditor Forbearance: The company has operated with negative working capital for multiple consecutive years. In micro-entities, this structural deficit is typically sustained through director loans or related-party creditors deferring repayment. If these liabilities are owed to unrelated third parties, the risk of insolvency proceedings is substantially higher.

Positive Indicators: * Longevity and Operational Stability: Incorporated in 2007, the company has successfully traded for over 17 years, demonstrating an ability to survive market cycles despite its balance sheet constraints. * Improving Net Asset Trajectory: While still insolvent, net liabilities have improved from a trough of £-48,014 in 2020 to £-27,592 in 2025, suggesting a gradual de-leveraging or recovery of retained earnings. * Regulatory Compliance: The company is actively filing its accounts and confirmation statements on time. There are no overdue filings, and the sole director has no recorded disqualifications, indicating basic administrative stability.

Due Diligence Notes: * Creditor Composition: It is imperative to determine the nature of the £55,841 owed within one year. Micro-entity accounts do not require disclosure of related-party balances. Confirmation is needed on how much of this debt is owed to the directors (David and Charlotte Slater) versus external trade creditors or financial institutions. If the liabilities are primarily director-funded, the solvency risk is mitigated by their likely willingness to delay repayment. * Profitability and Cash Generation: As a micro-entity, the filed accounts lack a Profit & Loss account and Cash Flow statement. An investor must request management accounts to verify that the company is currently generating positive operating cash flow, as this is the only viable mechanism to organically resolve the working capital deficit. * 2023 Asset Fluctuation: Total assets spiked to £102,338 in 2023 before dropping back to £31,134 in 2025. Investigation is required to understand this volatility—whether it was due to a large one-off contract, an interim loan injection, or a temporary shift in debtor levels.