Company Number: SC677795

Analysis Date: 2025-07-29 20:22 UTC

1. Risk Rating: MEDIUM
   The company demonstrates minimal net current assets and a significant decline in shareholders' funds over the last four years, indicating potential solvency and liquidity pressures. However, it remains compliant with filing requirements and is not in liquidation or administration, which mitigates immediate high-risk concerns.

2. Key Concerns:

• Declining Financial Position: Shareholders' funds decreased from £29,718 in 2020 to £1,678 in 2023, reflecting erosion of net assets and possible operational losses or withdrawals.
• Tight Working Capital: Net current assets have fallen to a marginal £1,678, suggesting limited buffer to cover short-term liabilities and potential liquidity strain.
• Limited Financial Transparency: The company files under micro-entity provisions with unaudited accounts, restricting insight into profitability, cash flows, or contingent liabilities, which increases uncertainty for investors.

3. Positive Indicators:

• Compliance: No overdue filings for accounts or confirmation statements, demonstrating sound regulatory adherence and good governance practices.
• Stable Management: The same three directors have been in place since incorporation, suggesting leadership continuity.
• Modest Operational Scale: With a micro-entity classification and an average of 3 employees, the company likely has low fixed costs, which may afford some flexibility in managing finances.

4. Due Diligence Notes:

• Investigate the causes for the significant decline in net assets and shareholders’ funds over the past four years. Review any related party transactions, distributions, or losses.
• Request management accounts or cash flow statements to assess current liquidity position and operational cash generation.
• Confirm the nature and timing of creditors included in current liabilities to evaluate short-term payment obligations and potential solvency risks.
• Seek clarity on business model sustainability, client base, and revenue trends given the low financial reserves.