LENA DESIGN CONSULTANCY LTD

Executive Summary

Lena Design Consultancy Ltd is a micro-sized startup with a negative working capital position and no trading history, resulting in an insolvent balance sheet at its first year-end. The company’s current financial state indicates high credit risk and insufficient liquidity to meet short-term liabilities. Credit facilities should be declined until the company demonstrates improved financial strength and cash flow stability.

LENA DESIGN CONSULTANCY LTD - Analysis Report

Company Number: 15218842

Analysis Date: 2025-07-20 16:29 UTC

1. Credit Opinion: DECLINE
   Lena Design Consultancy Ltd is a newly incorporated micro private limited company with a single director and sole shareholder. The financials for the first 12-month period ending October 2024 reveal significant net current liabilities of £7,807 against current assets of only £24, resulting in negative shareholders’ funds of £7,807. This indicates the company is insolvent on a balance sheet basis. There is no evidence of revenue or profitability yet, and the negative working capital position suggests an inability to meet short-term obligations without additional funding. Given the early stage with no trading history and negative net assets, the credit risk is high. Approval for lending or credit facilities is not recommended without strong external financial support or guarantees.

2. Financial Strength:
   The balance sheet is weak. The company holds negligible current assets (£24) and current liabilities of £7,831, showing a net current liability position of £7,807. Total assets less current liabilities mirror this deficit as the company has no fixed assets or reserves. Shareholders’ funds are negative, reflecting accumulated losses or startup costs funded by debt or shareholder loans. The absence of equity and working capital buffers points to a fragile financial position typical for a startup but insufficient for credit extension without further capital injection.

3. Cash Flow Assessment:
   Liquidity is critically constrained. With only £24 in current assets (likely cash or receivables) against liabilities due within one year of £7,831, the company lacks operational cash inflows or working capital to meet creditor demands. The absence of positive cash flow or retained earnings means ongoing operations depend on fresh funding or director support. This liquidity risk undermines debt servicing capacity and increases the probability of payment defaults.

4. Monitoring Points:

• Track monthly cash flow and bank balances to assess liquidity improvements.
• Review future filings for revenue generation, profitability, and equity injections.
• Monitor any director loans or external financing arrangements to cover current liabilities.
• Watch for any overdue filings or regulatory compliance issues given the early stage.
• Follow any changes in ownership or director appointments that might impact governance or financial support.