Company Number: 13751661

Analysis Date: 2025-07-29 19:59 UTC

1. Risk Rating: HIGH
   The company is rated high risk primarily due to its cessation of trading within the next 12 months and the preparation of accounts on a non-going concern basis. This indicates imminent operational discontinuity and potential insolvency risk.

2. Key Concerns:

• Going Concern Qualification: Directors explicitly state the company is expected to cease trading within 12 months and have prepared accounts accordingly, signaling a winding-down phase.
• Tight Liquidity Position: Net current assets are minimal (£30,001 as at 31-Dec-2023) with current liabilities nearly equal to current assets, indicating limited short-term liquidity buffer.
• Significant Reduction in Debtors and Cash: Debtors decreased from £6.07m (2022) to £3.28m (2023) and cash decreased by about £130k, suggesting collection difficulties or declining business volume, potentially impairing cash flow.

3. Positive Indicators:

• No Overdue Filings: Both accounts and confirmation statement are filed on time, indicating regulatory compliance and good governance in reporting.
• Audit Opinion Unqualified: Independent auditor has given an unmodified opinion and found no material misstatements or irregularities, adding credibility to the financial information presented.
• Completion and Release of Film: The company has completed and released its contracted feature film, achieving its principal business objective for the period under review.

4. Due Diligence Notes:

• Investigate reasons behind the directors’ decision to cease trading within 12 months and whether formal liquidation or other closure procedures have commenced.
• Assess collectability and aging profile of debtors to understand cash flow risks and any potential bad debts.
• Review creditor composition and payment terms to evaluate short-term obligations and risk of default.
• Clarify the nature of the relationship and financial support from the parent company (Exit Light Productions Limited), which holds 75-100% control.
• Confirm no outstanding litigation, regulatory issues, or contingent liabilities that may impact closure or creditor recoveries.