Company Number: 13122572

Analysis Date: 2025-07-20 15:19 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   MJCDC INSPECTIONS LTD is a micro-entity operating in electrical installation with a very small scale of operations, evidenced by a single employee and minimal asset base. The company shows a significant deterioration in net assets and shareholders’ funds from £5,338 in 2024 to £242 in 2025, largely due to a sharp increase in provisions for liabilities (£2,910 in 2025 vs. £2,140 in 2024). This raises concerns about contingent liabilities or potential claims that may affect solvency. While the company remains active and filings are up to date, the decline in financial strength suggests risk. Credit approval is conditional on obtaining further information on the nature of provisions and confirmation of stable or improving cash flow going forward.

2. Financial Strength:
   The balance sheet indicates a fragile financial position. Fixed assets decreased from £353 to £0 (not explicitly stated but implied by absence), and current assets halved from £7,125 to £3,152. Net current assets remain positive but decreased significantly. The large increase in provisions for liabilities reduces net assets drastically, suggesting potential future cash outflows or unresolved obligations. Shareholders’ funds are minimal at £242, indicating very limited equity buffer. This thin capital base reduces the company’s ability to absorb financial shocks.

3. Cash Flow Assessment:
   Current assets of £3,152 primarily represent liquid or receivable assets, with no detailed breakdown. The company’s net current assets are positive but have declined sharply, indicating reduced working capital. The absence of detailed cash flow statements limits full assessment, but the decline in net assets and increased provisions suggest the company may experience liquidity strain. Given the single employee and micro status, operating cash flow is likely limited. Close monitoring of receivables collection and creditor payment terms is advised.

4. Monitoring Points:

• Nature and cause of increased provisions for liabilities and whether these are likely to crystallize into cash outflows.
• Trends in current assets and liabilities to ensure working capital sufficiency.
• Cash flow statements and aging of receivables/payables to evaluate liquidity management.
• Any changes in business scale, client base, or contract terms that could impact revenue or risk profile.
• Director’s ongoing financial stewardship given minimal equity and tight margins.