Company Number: NI682297

Analysis Date: 2025-07-29 12:41 UTC

1. Risk Rating: HIGH
   Justification: The company exhibits significant solvency risk evidenced by sharply deteriorating net assets from £17,504 in 2023 to only £1,079 in 2024, primarily due to a large increase in long-term creditors. The net current assets remain positive but have declined, indicating potential liquidity constraints.

2. Key Concerns:

• Solvency and Leverage: Long-term liabilities have increased substantially from £48,252 (2023) to £69,782 (2024), which heavily strains the company’s equity and solvency position.
• Declining Net Assets: Net assets have dropped by over 90% year-on-year, signaling erosion of shareholder value and increased risk of insolvency if negative trends persist.
• Limited Operational Scale: The company remains a micro-entity with only one employee and minimal current assets (£19,749), suggesting limited operational capacity and possibly constrained cash flow generation.

3. Positive Indicators:

• Current Assets Exceed Current Liabilities: Despite overall weak financial position, net current assets remain positive (£17,741 in 2024), indicating the company can meet short-term obligations at the balance sheet date.
• No Overdue Filings: The company is compliant with statutory filing deadlines for accounts and confirmation statements, reducing regulatory risk.
• Stable Fixed Assets Growth: Fixed assets have increased from £42,400 to £56,320, potentially reflecting investment in productive capacity or longer-term assets.

4. Due Diligence Notes:

• Investigate the nature and terms of the long-term creditors to understand the reasons behind the increased liabilities and assess repayment risk.
• Review cash flow statements (not provided) to evaluate operational cash generation and liquidity management.
• Assess customer base, contracts, and revenue streams to determine business sustainability and prospects given the small scale of operations.
• Confirm director background and governance practices, as limited disclosures and small staff size may increase dependency on key individuals.
• Validate whether any contingent liabilities or off-balance sheet risks exist that could exacerbate financial risk.