Company Number: SC736013

Analysis Date: 2025-07-29 16:09 UTC

1. Risk Rating: MEDIUM
   The company shows modest net assets and an improving balance sheet position, but current liabilities remain substantial relative to current assets. The business is small and relatively new, which imposes inherent risks typical of early-stage enterprises.

2. Key Concerns:

• Liquidity Position: Current liabilities (£31,126) exceed current assets (£5,798) as of June 2024, resulting in negative net working capital (-£25,328). This suggests potential short-term liquidity pressure.
• Small Scale and Limited Capital: Share capital is minimal (£3), and the company relies on accumulated reserves for net assets (£6,095). This limited equity base may constrain financial flexibility.
• Concentration of Control: One director (Thomas Reed) holds 75-100% voting rights and the power to appoint/remove directors, indicating potential governance risks related to decision-making concentration.

3. Positive Indicators:

• Improved Financial Position: The net assets improved from a negative position in 2023 (-£4,343) to a positive £6,095 in 2024, indicating some recovery or growth.
• Consistent Employee Base: The company maintains a stable workforce (3 employees), which supports operational continuity.
• On Time Filings: Accounts and confirmation statements are current with no overdue filings, reflecting regulatory compliance and good governance practices.

4. Due Diligence Notes:

• Investigate the nature and timing of current liabilities to assess whether these are short-term payables that could stress cash flow.
• Review cash flow statements or bank statements (not provided) for evidence of liquidity management.
• Assess the company's business model and contracts to evaluate sustainability and revenue generation capacity.
• Clarify the shareholding structure and governance arrangements to understand the implications of concentrated voting power.
• Confirm whether there are any contingent liabilities, related party transactions, or off-balance sheet risks not visible in the micro-entity accounts.