Company Number: 13917715

Analysis Date: 2025-07-29 18:01 UTC

1. Risk Rating: HIGH

The company exhibits significant solvency risks with net liabilities of £26,519 as of the latest accounts (2024-02-28), a decline from positive shareholders’ funds in the previous year. The presence of long-term creditors (£29,977) outweighing current assets is a critical concern. The company is a micro entity with minimal turnover and only two employees, which suggests limited operational scale and resilience.

2. Key Concerns:

• Negative Net Assets: The company’s net liabilities position indicates financial distress, reducing its ability to meet obligations and posing solvency risk.
• High Long-Term Creditors: Creditors due after more than one year (£29,977) substantially exceed current assets, signalling potential liquidity and refinancing risks.
• Limited Scale and Resources: As a micro-entity with only two employees and minimal current assets (£3,967), the company’s operational stability and capacity to generate cash flow may be fragile.

3. Positive Indicators:

• Compliance with Filing Obligations: The company is up to date with accounts and confirmation statement filings, reflecting good regulatory compliance.
• Experienced Directors with Control: The two directors, who are also significant controllers, have remained consistent since incorporation, potentially providing stable leadership.
• No Auditor Requirement: The company qualifies for the micro-entity regime and exemption from audit, reducing compliance costs.

4. Due Diligence Notes:

• Examine Nature of Long-Term Creditors: Clarify the terms, security, and repayment schedule of the £29,977 long-term liabilities to assess refinancing or default risk.
• Assess Cash Flow and Profitability Trends: Obtain internal management accounts or cash flow forecasts to understand if the negative net assets are a temporary issue or indicative of ongoing losses.
• Review Directors’ Plans: Investigate strategies the directors have for returning the company to a positive net asset position and sustaining operations.
• Confirm Absence of Director Disqualifications or Regulatory Issues: Although none are indicated, verify no adverse director conduct or compliance breaches exist.