JG VKENGINEERING LTD

Executive Summary

JG VKENGINEERING LTD is a small engineering consultancy with a fragile financial position characterized by negative equity and working capital deficits. While the company is operational and compliant with filings, reliance on director funding and limited asset base pose liquidity risks. Conditional credit approval is advised with close monitoring of cash flows and balance sheet improvements.

JG VKENGINEERING LTD - Analysis Report

Company Number: 13454379

Analysis Date: 2025-07-20 18:15 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   JG VKENGINEERING LTD is a very small engineering consultancy operating as a micro-entity since 2021. The company has maintained active trading with modest asset levels but reported a negative equity position at the latest year-end. The negative shareholders’ funds and current liabilities exceeding current assets indicate balance sheet weakness, raising concerns about solvency and financial resilience. However, the company has no overdue filings, and the single director/owner appears committed with no adverse conduct records. Conditional approval is recommended with limits on credit exposure and monitoring of liquidity, given the tight working capital and negative net assets.

2. Financial Strength:

• Fixed assets are minimal and declining (£750 in 2023 to £375 in 2024), reflecting limited capital investment.
• Current assets increased from £7,520 to £12,145, which is positive, but current liabilities have grown from £7,348 to £12,962, resulting in a negative net current asset position (~-£817).
• Shareholders’ funds deteriorated from a nominal positive £1 to -£1,563, signaling accumulated losses or director loans not reflected as equity.
• Provisions for liabilities increased moderately, indicating some anticipated obligations.
  Overall, the balance sheet is weak and shows signs of financial strain despite growth in current assets.

3. Cash Flow Assessment:

• The company reported only one employee (the director) and limited fixed assets, indicating low operating overhead.
• Current liabilities exceeding current assets suggests potential liquidity pressure, possibly requiring director advances or external support to meet short-term obligations.
• Director loans increased from nil to £9,580, indicating reliance on shareholder funding to support working capital.
• No audit or cash flow statement available, but working capital management is a key risk area.
  Liquidity is constrained and dependent on continued director support or timely inflows from clients.

4. Monitoring Points:

• Track improvement or deterioration in net current assets and shareholders’ funds on next accounts filings.
• Monitor director loan balances and terms to ensure they do not impair company creditworthiness.
• Watch for any overdue filings or changes in company status that may signal distress.
• Review client payment patterns and cash conversion cycle to assess liquidity risk.
• Confirm ongoing viability of the business model and management plans for profitability.