MCG IT SOLUTIONS LTD

Executive Summary

MCG IT SOLUTIONS LTD is a newly formed micro-entity with minimal financial resources and negligible net assets. The company's balance sheet shows limited liquidity primarily supported by an unsecured director loan, indicating weak financial strength and cash flow capacity. Given these factors, the company is currently unsuitable for credit facilities but should be re-evaluated upon demonstration of operational performance and improved financial metrics.

MCG IT SOLUTIONS LTD - Analysis Report

Company Number: 14672757

Analysis Date: 2025-07-29 13:56 UTC

1. Credit Opinion: DECLINE
   MCG IT SOLUTIONS LTD is a newly incorporated micro-entity with minimal financial data and an extremely limited asset base. The balance sheet as of 28 February 2024 shows net assets of just £1, with current assets of £1,137 almost exactly matched by current liabilities of £1,136, indicating no meaningful working capital buffer. Additionally, a significant proportion of current assets (£1,069) represent an unsecured, interest-free director loan, which may not be readily available for operational liquidity. Given the lack of operational history, negligible tangible net worth, and reliance on director advances, the company does not currently demonstrate sufficient financial strength or cash flow capacity to support credit facilities.

2. Financial Strength:
   The company’s financial position is extremely weak. Total net assets stand at £1, reflecting a balance sheet with virtually no surplus over liabilities. The micro-entity has no fixed assets, and its current assets are just enough to cover current liabilities, leaving minimal working capital. The director loan recorded as a debtor inflates current assets but is not a cash equivalent or guaranteed repayment source. The absence of retained earnings or reserves and the reliance on a single director controlling the company with no other shareholders or directors further concentrates risk.

3. Cash Flow Assessment:
   Cash flow is highly constrained. With current liabilities nearly equal to current assets, liquidity is minimal. The director loan provides some internal funding but is unsecured and repayable on demand, offering no assurance of stable cash availability. The company has only one employee (the director), which keeps overheads low, but there is no indication of revenue generation or profitability to support debt servicing. The lack of historical financial performance and absence of positive cash flow trends raise concerns about the company’s ability to generate sufficient operating cash to meet any credit obligations.

4. Monitoring Points:

• Monitor future filings for revenue, profit, and cash flow development.
• Watch for changes in working capital and reduction of reliance on director loans.
• Track any increase in net assets or the establishment of tangible collateral.
• Observe whether additional directors or investors appear to reduce single-person control risk.
• Review timely filing of accounts and confirmation statements to assess compliance and governance.