LEARN AND PLAY LONDON CIC

Executive Summary

LEARN AND PLAY LONDON CIC is a micro-entity with a positive operating result but very limited financial resources. The company demonstrates initial growth and sound working capital but remains vulnerable due to its small scale. Conditional credit approval is recommended with ongoing monitoring of profitability and liquidity to ensure it can meet debt obligations.

LEARN AND PLAY LONDON CIC - Analysis Report

Company Number: 13937006

Analysis Date: 2025-07-29 13:44 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   LEARN AND PLAY LONDON CIC is a newly established community interest company focused on childcare activities. The company shows improving turnover and a small operating profit in the latest financial year, indicating early-stage growth and operational viability. However, the absolute scale of operations and financial reserves remain very modest, with limited working capital and net assets of £2,422. The company’s ability to service credit facilities depends on continued revenue growth and careful cost management. Credit approval should be conditional on regular financial monitoring and limits aligned with their current size and cash flow capacity.

2. Financial Strength:
   The balance sheet shows very low asset and equity values consistent with a micro-entity profile. The company has no long-term liabilities and current liabilities of only £237, resulting in a positive net current asset position of £2,422. Net assets have increased from £1 to £2,422 year-over-year, reflecting retained earnings of £2,421 from a modest profit. The company is unleveraged with no debt, but equity and cash buffers are minimal. Financial strength is limited but stable at this early stage.

3. Cash Flow Assessment:
   Cash on hand is £2,534, which covers current liabilities comfortably, indicating adequate short-term liquidity. The cash balance grew from £1,975 to £2,534 year-over-year. Debtors are minimal (£125), suggesting prompt collection or limited credit sales. With only one employee and low administrative expenses, working capital management appears efficient. Nonetheless, cash flow is tightly constrained by the business scale, and any unexpected expenses or revenue shortfalls could impact liquidity.

4. Monitoring Points:

• Revenue growth trajectory and ability to increase turnover beyond £87k
• Maintenance of positive operating margin and net profitability
• Cash flow sufficiency to cover operational costs and small credit facilities
• Changes in current liabilities and potential build-up of trade creditors or tax obligations
• Director and management continuity and governance practices
• Any changes to the scope of business or funding arrangements impacting risk profile