INNOVATIVE CODE LTD

Executive Summary

Innovative Code Ltd currently exhibits poor financial strength with negative net assets and insufficient working capital, indicating limited ability to service debt or meet short-term liabilities. The company’s very early stage of operation and micro-entity status offer minimal financial history or resilience, warranting a decline of credit facilities until a stronger financial position and track record are demonstrated. Close monitoring of liquidity and operational developments is essential.

INNOVATIVE CODE LTD - Analysis Report

Company Number: 13815987

Analysis Date: 2025-07-29 14:26 UTC

1. Credit Opinion: DECLINE. Innovative Code Ltd shows negative net current assets and net liabilities of £86 as of 31 December 2022. This indicates the company’s current liabilities exceed its current assets, pointing to potential liquidity issues and inability to meet short-term obligations. The micro-entity financials reveal minimal asset base (£42 current assets) against higher creditors (£128), which raises concerns about payment capability. Given its recent incorporation (Dec 2021) and limited operating history with only one employee, the company lacks demonstrated financial resilience or track record to support credit extension at this stage.

2. Financial Strength: The balance sheet is weak, with total net liabilities of £86 and no fixed assets reported. Shareholders’ funds are negative, indicating erosion of equity capital. The company’s micro status and small scale limit asset accumulation, and the negative working capital situation signals financial stress. No audit or detailed financial disclosures are available beyond micro-entity filings, restricting insight into profitability or cash flow trends. The director is the sole significant controller, which reduces diversification of management risk but concentrates accountability.

3. Cash Flow Assessment: Current assets of only £42 (likely cash or receivables) against current liabilities of £128 suggest tight liquidity and potential cash flow constraints. Negative net current assets imply working capital deficiency, impairing the company’s ability to fund day-to-day operations without additional financing or capital injection. As a software development entity, receivables might be low but the minimal asset base and negative working capital highlight a risk of payment delays or default if faced with unexpected expenses.

4. Monitoring Points:

• Monitor next financial filings for signs of improved liquidity or capital injection.
• Track payment behavior on existing supplier or creditor accounts.
• Assess any changes in director or ownership structure that might impact financial strategy.
• Watch for any overdue filings or legal notices indicating financial distress.
• Review any new contracts or revenue growth that could improve cash flow and asset base.