MOHAMMAD ABRAR ALI LIMITED

Executive Summary

Mohammad Abrar Ali Limited is a recently incorporated micro-entity with a negative net asset position and significant working capital deficiency. The current financials indicate poor liquidity and an inability to meet creditor demands without external support. Credit facilities are not advisable until the company demonstrates improved financial stability and cash flow generation.

MOHAMMAD ABRAR ALI LIMITED - Analysis Report

Company Number: SC761811

Analysis Date: 2025-07-20 19:04 UTC

1. Credit Opinion: DECLINE
   Mohammad Abrar Ali Limited shows significant financial weakness as of the latest accounts (31 March 2024). The company reports net current liabilities of £8,064 and total net liabilities of £9,264, indicating an insolvent balance sheet position. This raises serious concerns about its ability to meet current obligations and service any credit facility. Given the company's recent incorporation (March 2023) and micro-entity status, there is insufficient financial history or evidence of operational stability to mitigate risk. Therefore, credit approval is not recommended at this stage.

2. Financial Strength:
   The balance sheet reveals a negative net asset position (£-9,264), with current liabilities (£9,008) far exceeding current assets (£944). The company’s working capital is negative by £8,064, reflecting a lack of liquidity and financial buffer. Capital and reserves are in deficit, and no fixed assets are reported to support the balance sheet. The business appears to be in an early stage with minimal tangible financial strength.

3. Cash Flow Assessment:
   The negative net current assets imply liquidity constraints; the company may face difficulty covering short-term liabilities as they fall due. With only £944 in current assets (likely cash or receivables) against over £9,000 of short-term creditors, working capital management is a concern. There is no available data on cash flow from operations, but the balance sheet position suggests reliance on external funding or shareholder support to maintain solvency.

4. Monitoring Points:

• Improvement in net current assets and reduction of liabilities
• Generation of positive cash flow and accumulation of retained earnings
• Timely filing of accounts and confirmation statements to ensure compliance
• Business revenue growth and diversification to strengthen financial base
• Director’s ability to inject capital or secure external funding if needed