Company Number: 13116595

Analysis Date: 2025-07-20 13:00 UTC

1. Risk Rating: MEDIUM
   MAUVAIS LIMITED shows a recent and significant turnaround from net liabilities in 2023 to net assets in 2024, which is positive. However, the company maintains a high level of current liabilities relative to current assets, substantial stock levels, and reliance on intangible assets like website development. These factors suggest moderate solvency and liquidity risks that warrant cautious monitoring.

2. Key Concerns:

• High Current Liabilities vs. Current Assets: While net current assets improved to £284k, current liabilities remain substantial at £796k, indicating potential short-term liquidity pressure.
• Large Stock Holding with Declining Value: Stock reduced from £619k to £362k, which may indicate sales or write-downs; stock levels still represent a significant portion of current assets and could pose risk if not converted quickly to cash.
• No Audit and Limited Reporting Detail: Accounts are unaudited and prepared under the small companies regime, limiting assurance on financial accuracy and completeness, which increases due diligence requirements.

3. Positive Indicators:

• Return to Profitability and Positive Equity: The company moved from a loss reserve of -£110k in 2023 to a positive profit and loss reserve of £392k in 2024, leading to net assets of £392k.
• Revenue-generating and Active Online Presence: Operates in retail and wholesale of clothing with an active website and social media channels, indicating operational activity and market engagement.
• No Overdue Filings or Compliance Issues: All statutory accounts and confirmation statements are up to date, showing good governance compliance to date.

4. Due Diligence Notes:

• Verify Cashflow Stability: Investigate cash conversion cycle, focusing on stock turnover and debtor collection periods to assess liquidity risks.
• Assess Quality of Intangible Assets: Confirm that intangible assets such as capitalised website development costs are recoverable and not overstated.
• Review Debt Terms and Maturity: Examine the nature and timing of current and any long-term liabilities to understand refinancing or repayment risks.
• Confirm Absence of Director or Regulatory Issues: Validate that the director has no disqualifications or adverse conduct records.
• Examine Profit Drivers: Analyze revenue trends and margins to ensure the sustainability of the recent return to profitability.