Company Number: OC437366

Analysis Date: 2025-07-29 17:51 UTC

1. Risk Rating: MEDIUM
   The company holds significant fixed assets relative to turnover and has net positive assets. However, high current liabilities and no current assets disclosed raise liquidity concerns that moderate the overall risk profile.

2. Key Concerns:

• Liquidity Risk: Current liabilities stand at £1,025,000 with no current assets reported, indicating potential difficulty meeting short-term obligations despite positive net assets.
• Revenue Scale and Operational Scope: Turnover is modest (£86,058 for the latest period) compared to the large fixed asset base (£1.73 million), suggesting limited operational cash inflow relative to obligations.
• Financial Structure and Debt: Loans and other debts due to members equal net assets (£705,000), implying reliance on member funding and possibly limited external financing or reserves.

3. Positive Indicators:

• Net Asset Position: Positive net assets of £705,000 reflect that total assets exceed liabilities, indicating solvency on a balance sheet basis.
• Consistent Profitability: The LLP reported profits before members’ remuneration (£41,934 for the period) and steady turnover growth over the last periods, suggesting operational stability.
• Compliance: The LLP is active, with no overdue filings or indications of regulatory non-compliance. Accounts are prepared under micro-entity provisions and were signed off appropriately.

4. Due Diligence Notes:

• Investigate the nature and terms of the current liabilities (£1,025,000) to assess maturity profiles and repayment obligations.
• Review cash flow statements (not provided) to understand liquidity management and ability to service short-term debts.
• Clarify the composition of fixed assets and their realizable values, since these are substantial relative to turnover and liabilities.
• Confirm any contingent liabilities or off-balance sheet obligations that could affect financial stability.
• Assess the LLP’s business model and revenue generation capacity given the low turnover and no employees reported.