NIMBUS ART LIMITED

Executive Summary

Nimbus Art Limited is an early-stage private limited company showing ongoing negative net asset and working capital positions, with a material reliance on director funding to support operations. While compliance filings are current and the company has built some stock assets, significant solvency and liquidity risks persist. Further due diligence is recommended to assess the sustainability of director support and the company’s operational viability.

NIMBUS ART LIMITED - Analysis Report

Company Number: 14194218

Analysis Date: 2025-07-19 11:52 UTC

1. Risk Rating: HIGH
   The company exhibits a persistent negative net asset position and net current liabilities over two consecutive years, indicating solvency and liquidity concerns. The reliance on director’s financial support further elevates the risk profile.

2. Key Concerns:

• Solvency Risk: Negative net assets of £1,287 as at June 2024 (worsened from £834 in 2023) indicate the company’s liabilities exceed its assets, raising doubts about its ability to meet long-term obligations.
• Liquidity Issues: Net current liabilities of £1,287 and low cash reserves (£2,412 in 2024) relative to current liabilities (£12,325) suggest potential cash flow difficulties in meeting short-term obligations.
• Reliance on Director Support: The accounts note the company’s going concern assumption depends on director support, with a director’s loan account credit of £10,143 but no fixed repayment terms, indicating potential ongoing funding dependency.

3. Positive Indicators:

• No Filing or Compliance Issues: All statutory filings, including accounts and confirmation statements, are up to date with no overdue notices.
• Small Company Reporting & Exemption: The company benefits from small company exemptions, reducing administrative burden.
• Stock Holding Growth: Increase in stock from £4,626 in 2023 to £8,626 in 2024 may indicate inventory buildup aligned with business plans or anticipated sales growth.

4. Due Diligence Notes:

• Investigate the nature and sustainability of director support, including any informal or formal agreements underpinning the going concern assumption.
• Obtain management accounts and cash flow forecasts to assess short-term liquidity management and operational cash generation capability.
• Clarify the reasons behind consistent trading losses and negative equity, including an evaluation of business model viability and market conditions impacting the company’s sector (82990 – Other business support services).
• Review any contingent liabilities or off-balance sheet exposures not disclosed in filleted accounts due to small company exemptions.
• Confirm whether the director’s loan account balance is likely to be repaid or converted to equity in the medium term.