Company Number: SC680202

Analysis Date: 2025-07-29 19:23 UTC

1. Risk Rating: LOW
   The company demonstrates a solid net asset position relative to its size, with net assets of £37,491 as of 30 November 2023 and positive net current assets of £19,491. There are no overdue filings or indications of financial distress. The micro-entity classification suggests limited complexity and relatively low operational scale, which aligns with manageable risk levels.

2. Key Concerns:

• Limited Financial History: Incorporated in late 2020 and with only two years of financial data available, the company’s operational track record is short, which restricts trend analysis and long-term stability assessment.
• Modest Capitalization: Share capital remains at £100, indicating minimal equity base, although retained earnings have increased shareholder funds.
• Employee Growth and Cost Structure: The jump from 1 to 5 employees within a year necessitates closer scrutiny of payroll and operating expense growth to ensure sustainable cash flow.

3. Positive Indicators:

• Strong Liquidity: Current assets of £24,367 comfortably exceed current liabilities of £4,876, yielding a healthy net working capital position.
• Positive Net Asset Growth: Net assets increased significantly from £100 in 2021 to £37,491 in 2023, reflecting retained profits or capital injections.
• Compliance Status: All statutory filings including accounts and confirmation statements are up to date with no overdue submissions or penalties, indicating sound governance.
• Directors Stability: Two directors have been in place since incorporation with no adverse records or disqualifications noted.

4. Due Diligence Notes:

• Verify nature and valuation of fixed assets (£18,000) to confirm they are tangible and appropriately recorded.
• Assess revenue and profitability trends since inception to evaluate operational sustainability and growth trajectory.
• Review cash flow statements or management accounts if available to understand working capital cycle and liquidity beyond balance sheet snapshots.
• Confirm absence of related party transactions or contingent liabilities not disclosed in micro-entity filings.
• Investigate business model specifics for licensed restaurants under SIC 56101 to identify sector-specific risks such as regulatory compliance or market conditions.