Company Number: 12906117

Analysis Date: 2025-07-29 19:21 UTC

1. Risk Rating: HIGH
   The company exhibits a significant deterioration in net current assets from £1,151 (FY 2023) to a negative £996 (FY 2024), indicating a liquidity shortfall. Shareholders’ funds have likewise diminished drastically from £1,405 to just £1, suggesting erosion of equity and potential solvency concerns.

2. Key Concerns:

• Liquidity Risk: Current liabilities (£3,604) now exceed current assets (£2,608), impairing the company’s ability to meet short-term obligations.
• Equity Erosion: Shareholders’ funds reduced to £1, effectively wiping out retained reserves, which raises questions about the company’s financial resilience and ongoing viability.
• Lack of Financial Depth: Micro-entity status with minimal fixed assets (£997) and only one employee limits operational scale and potential to generate revenue to offset liabilities.

3. Positive Indicators:

• Timely Filings: No overdue accounts or confirmation statements, indicating compliance with statutory filing requirements.
• Active Status: The company is actively registered and not under any insolvency process, providing a window for recovery or restructuring.
• Stable Incorporation: Incorporated in 2020, the company has maintained continuous operation for nearly four years.

4. Due Diligence Notes:

• Cash Flow Analysis: Investigate detailed cash flow statements and working capital management to assess operational cash generation or reliance on external financing.
• Profitability Trends: Examine profit and loss data for signs of declining revenues or increasing expenses contributing to equity depletion.
• Director and Ownership Review: Confirm any changes in management or ownership that could impact future strategy or financial support.
• Contingent Liabilities: Check for off-balance sheet liabilities or pending legal matters that may exacerbate financial strain.
• Business Model Sustainability: Evaluate client base, contracts, and market positioning given the industry classification (“Other business support services”) and small operational scale.