Company Number: NI695100

Analysis Date: 2025-07-20 12:15 UTC

1. Risk Rating: HIGH

Justification: The company exhibits negative net current assets and negative shareholders’ funds, indicating solvency concerns. It is a recently incorporated micro entity with minimal assets and a significant reliance on director advances, which elevates the financial risk.

2. Key Concerns:

• Solvency Risk: The company has net current liabilities of £423 and negative shareholders’ funds of £963, suggesting it is currently insolvent on a balance sheet basis.
• Liquidity Concerns: Current liabilities (£2,835) exceed current assets (£2,412), indicating potential cash flow constraints to meet short-term obligations.
• Financial Dependence on Director: The director has advanced £2,035 net to the company after repayments, signifying external funding reliance and potential risk if director support ceases.

3. Positive Indicators:

• Compliance: The company is active and up to date with accounts and confirmation statement filings, with no overdue submissions.
• Clear Control Structure: The sole director and 75-100% shareholder, Mrs Christine Jackson, provides straightforward governance and accountability.
• Audit Exemption: As a micro-entity, the company benefits from audit exemptions, reducing compliance costs.

4. Due Diligence Notes:

• Investigate the nature and terms of the director advances, including whether these are loans or equity, and any repayment plans.
• Clarify the company's business model and cash flow projections given its retail mail order/Internet sales classification, to assess operational sustainability.
• Monitor future filings to track improvements or deterioration in financial position and liquidity.
• Review any contingent liabilities or off-balance sheet commitments not disclosed in the filleted accounts.
• Evaluate the director’s capacity to continue supporting the company financially if needed.