Company Number: SC718546

Analysis Date: 2025-07-20 12:05 UTC

1. Risk Rating: MEDIUM
   The company shows positive net assets and shareholder funds, but current assets are significantly lower than current liabilities as of the latest year-end, signaling potential liquidity concerns. Limited financial history and micro-entity status restrict a comprehensive risk assessment.

2. Key Concerns:

• Liquidity Risk: Current assets (£10,390) are less than current liabilities (£23,809) as of 31 March 2024, resulting in negative net current assets (-£13,419), which may indicate cash flow or short-term obligation challenges.
• Declining Asset Base: Fixed assets decreased from £35,500 in prior years to £30,500, and current assets have dropped substantially from £26,382 to £10,390, suggesting possible operational or sales issues.
• Limited Scale and History: Incorporated in late 2021 and filing as a micro-entity with only four employees, the company’s small size and relatively short trading history limit visibility on long-term operational stability.

3. Positive Indicators:

• Positive Net Assets: Despite liquidity issues, total net assets increased slightly from £15,687 to £17,081, indicating some retained value in the business.
• Satisfactory Compliance: No overdue filings for accounts or confirmation statements, demonstrating good regulatory compliance and governance.
• Clear Ownership and Control: Single director and 75-100% ownership by Mrs Razia Ahmed provide clarity in decision-making and accountability.

4. Due Diligence Notes:

• Review detailed cash flow statements and creditor ageing to assess short-term payment capacity and working capital management.
• Investigate reasons for sharp declines in current assets and whether this reflects reduced inventory, receivables, or other factors.
• Confirm ongoing business operations and client base stability given small employee count and asset reductions.
• Evaluate director’s plans for improving liquidity and financial position, including potential financing or restructuring measures.
• Verify any contingent liabilities or off-balance sheet obligations that may impact solvency.