MATT WORK LIMITED

Executive Summary

MATT WORK LIMITED shows signs of recovering liquidity and improved net asset position in the latest financial year, supported by a strong cash balance. However, historical volatility in current liabilities, dependence on bank loans, and minimal equity capital present moderate solvency and governance risks. Continued monitoring of financing arrangements and operational cash flows is recommended to confirm stability.

MATT WORK LIMITED - Analysis Report

Company Number: 12660760

Analysis Date: 2025-07-29 14:46 UTC

1. Risk Rating: MEDIUM
   The company demonstrates improvement in net current assets and net assets over the latest financial year, reflecting a recovery from prior liquidity strain. However, the presence of significant short-term liabilities relative to current assets in recent years and reliance on bank loans raise moderate solvency and liquidity concerns.

2. Key Concerns:

• Volatile Current Liabilities: The current liabilities fluctuated significantly from £50,000 in 2020 to £100,005 in 2023, then reduced to £47,788 in 2024, indicating possible instability in short-term obligations management.
• Bank Loan Dependency: The company had substantial bank loans (£100,000 in 2023 reducing to £42,193 in 2024) with a prior long-term loan of £57,807 which was cleared by 2024; this reliance on external financing merits scrutiny regarding repayment capacity and refinancing risk.
• Minimal Share Capital and Single Director Ownership: With only £1 share capital and a sole director who holds full control, governance and capital buffer concerns arise, impacting operational resilience and investor confidence.

3. Positive Indicators:

• Improved Liquidity Position in Latest Year: Current assets increased to £63,798 with cash almost equal to current assets (£63,797), surpassing current liabilities of £47,788, indicating improved working capital and cash availability.
• Consistent Compliance: No overdue filings for accounts or confirmation statements, reflecting good regulatory compliance and timely disclosure.
• Small Entity Exemption and Simple Structure: The company’s small size and exemption from audit reduce administrative burden and costs, potentially aiding operational focus.

4. Due Diligence Notes:

• Review the nature and terms of bank loans and overdrafts, especially repayment schedules and interest obligations, to assess refinancing or default risk.
• Investigate the cause of prior years’ high current liabilities and the recent improvement to evaluate sustainability of liquidity.
• Examine director governance practices given single director ownership and minimal share capital, including potential related party transactions.
• Confirm turnover, profit margins, and cash flow trends beyond balance sheet data to assess operational viability and growth prospects.
• Verify whether the director’s loan amount (£1) is immaterial or indicative of related party financing arrangements.