Company Number: 15240281

Analysis Date: 2025-07-29 18:57 UTC

1. Credit Opinion: DECLINE
   Koteli Ltd is a newly incorporated private limited company (Oct 2023) with a very weak financial position as at 31 Oct 2024. The company shows net current liabilities of £5,809 and shareholders’ funds negative at £5,708. The current liabilities consist entirely of directors’ current accounts (£6,974), indicating the company is relying on director funding to meet obligations. The absence of profitability data (income statement not filed) and a large working capital deficit suggest inability to service external debt or credit. Given these factors and very limited operating history, credit approval is not recommended at this stage.

2. Financial Strength:
   The balance sheet shows total assets (fixed + current) of £1,266 against current liabilities of £6,974, resulting in a negative net asset base. Fixed assets are minimal (£101 net book value) and current assets mainly consist of stock (£1,012) and cash (£153). The company is highly leveraged on director loans with zero external borrowings. Negative shareholders' funds indicate accumulated losses or funding shortfalls. Overall, the financial strength is weak and not supportive of new credit facilities.

3. Cash Flow Assessment:
   Cash on hand is low at £153, which is insufficient to cover short-term liabilities. The company exhibits a working capital deficit of £5,809, implying liquidity constraints. Reliance on directors’ accounts suggests short-term financing is precarious and potentially unsustainable without further equity injection or operational cash generation. Lack of income statement data prevents assessment of operating cash flow, but the liquidity position is a concern.

4. Monitoring Points:

• Monitor improvement in working capital position and reduction of directors’ current account balances.
• Watch for filing of next accounts and income statement to assess profitability and cash flow generation.
• Track any new external funding or equity injections to strengthen capital structure.
• Assess whether stock levels are being converted efficiently into sales and cash.
• Review director conduct and related party transactions given sole director and significant control.