NAUGHTY PIXELS TV LIMITED

Executive Summary

NAUGHTY PIXELS TV LIMITED shows signs of financial strain with a marked decrease in net assets and limited operational scale. While statutory compliance is up to date and leadership stable, liquidity and sustainability concerns warrant further investigation before considering investment. Detailed cash flow analysis and operational review are essential to understand underlying risks.

NAUGHTY PIXELS TV LIMITED - Analysis Report

Company Number: 14155888

Analysis Date: 2025-07-29 20:59 UTC

1. Risk Rating: HIGH
   Justification: The company exhibits a sharp decline in net assets from £2,965 in FY 2023 to merely £100 in FY 2024, indicating significant erosion of equity. The presence of substantial accruals and deferred income (£5,000) relative to current assets suggests potential cash flow timing issues. The lack of employees and minimal current assets raise concerns about operational scale and sustainability.

2. Key Concerns:

• Erosion of Net Assets: Drop from £2,965 to £100 within one year signals financial distress or losses not explicitly disclosed.
• Cash Flow and Liquidity: Current assets have decreased notably (from £12,071 to £4,457), while accruals and deferred income remain high, indicating possible timing mismatches in cash inflows and outflows.
• Operational Scale & Sustainability: No employees reported, which may reflect reliance on directors or contractors, limiting growth and operational capacity in a competitive video production industry.

3. Positive Indicators:

• Compliance with Filings: No overdue filings for accounts or confirmation statements, indicating good governance in statutory compliance.
• Directors’ Control and Stability: The two directors hold equal significant control and have maintained appointments since incorporation, suggesting stable leadership.
• Micro-Entity Status: The company benefits from simplified reporting requirements, which can reduce administrative overhead.

4. Due Diligence Notes:

• Investigate underlying reasons for the sharp decline in net assets and whether there were losses or asset write-downs not detailed in the micro-entity accounts.
• Review detailed cash flow statements, contracts, and client pipeline to assess liquidity and revenue generation capacity.
• Clarify the operational model given zero employees—are key functions outsourced or are directors performing all operational activities?
• Confirm the nature and timing of the accruals and deferred income to understand if they represent deferred revenue or liabilities that might impact solvency.
• Assess any related party transactions or director loans that could impact financial stability.