LION ROCK ENGINEERING LIMITED

Executive Summary

Lion Rock Engineering Limited exhibits high financial risk driven by negative equity and liabilities surpassing assets, raising solvency and liquidity concerns. While regulatory compliance is maintained and governance appears concentrated, the micro-scale operation with minimal disclosures limits assurance on operational stability. Further investigation into creditor terms, cash flow, and business fundamentals is recommended before investment consideration.

LION ROCK ENGINEERING LIMITED - Analysis Report

Company Number: 14294199

Analysis Date: 2025-07-20 14:21 UTC

1. Risk Rating: HIGH
   Justification: The company’s financial statements reveal significant negative net assets (£-32,318) and increasing liabilities exceeding assets. The absence of an audit and minimal operational scale further raise concerns about financial health and sustainability.

2. Key Concerns:

• Negative Equity Position: Shareholders’ funds and net assets are substantially negative and deteriorated from the prior year, indicating solvency risk.
• Liabilities Exceeding Assets: Creditors due after more than one year (£32,318) are greater than current assets, suggesting potential liquidity issues.
• Minimal Operational Scale: Only one employee and micro-entity status with limited financial information reduces visibility on operational sustainability and cash flow generation.

3. Positive Indicators:

• Timely Filing Compliance: The company is current with both accounts and confirmation statement filings, reflecting regulatory compliance.
• Single Controlling Director/PSC: The sole director and 100% shareholder (Mr. Vincent Cheung) may facilitate streamlined decision-making and governance.
• No Off-Balance Sheet Liabilities: The accounts disclose no contingent or off-balance sheet exposures, limiting hidden risks.

4. Due Diligence Notes:

• Investigate the nature and terms of creditors due after one year to assess repayment risk and refinancing needs.
• Review cash flow forecasts and funding plans to confirm ongoing liquidity and operational viability given negative equity.
• Obtain background on the director’s business experience and any intercompany transactions or guarantees.
• Inquire about the company’s business model and revenue generation given the micro category and limited employee count.
• Confirm that no related-party transactions or contingent liabilities exist beyond those disclosed.