LINEAR WORKS LIMITED

Executive Summary

Linear Works Limited is a micro-entity showing recent improvement in net assets and compliance with filing obligations. However, liquidity and operational scale remain limited, and cash flow stability is unclear, warranting a medium risk rating. Further due diligence on cash flow, business model viability, and asset quality is recommended to fully assess financial resilience.

LINEAR WORKS LIMITED - Analysis Report

Company Number: 13298569

Analysis Date: 2025-07-29 14:24 UTC

1. Risk Rating: MEDIUM
   Linear Works Limited shows improvement in financial position over the last reported year with net assets turning positive from a prior negative figure. However, the company remains small (micro-entity) with limited capital (£10 share capital) and modest fixed assets. Current liabilities remain significant relative to current assets, which may pose liquidity challenges. The company is relatively new (incorporated 2021) and operates in research and software development, sectors that can require ongoing investment.

2. Key Concerns:

• Liquidity Position: Although net current assets are positive in 2024 (£10,282), the current liabilities remain substantial (£32,170), and this fluctuated negatively in prior years. The balance relies on prepayments and accrued income (£17,030) that may not be immediately convertible to cash.
• Small Capital Base: The share capital is very low (£10), indicating limited equity buffer against operational or market risks.
• Operating Scale and Profitability: The company is a micro-entity with only 2 employees and limited financial disclosures. There is no evidence of profitability or cash flow stability in the data provided. The increase in net assets appears to be driven largely by accounting adjustments rather than substantive operational earnings.

3. Positive Indicators:

• Improved Net Asset Position: The company has turned net assets positive (£23,478) in 2024 from a negative position the previous year, indicating some strengthening balance sheet.
• Compliance and Timely Filings: Accounts and confirmation statements are up to date with no overdue filings, suggesting good regulatory compliance.
• Stable Management: The current director, Mr. Christopher Felder, has been in place since inception and holds significant control, which may provide continuity in leadership.

4. Due Diligence Notes:

• Verify the nature and realizability of prepayments and accrued income to assess real liquidity.
• Review profit and loss statements or management accounts to understand revenue streams and cash flow trends, not available in the current data.
• Investigate any contingent liabilities or off-balance sheet obligations that may impact solvency.
• Assess the business model sustainability given the small scale and sector risks, including reliance on key personnel and funding sources.