Company Number: 14244265

Analysis Date: 2025-07-29 20:31 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   OK BUTCHER LTD is a micro-entity operating in retail meat sales with a short trading history since July 2022. The company shows positive net current assets and a small but positive net asset base, indicating some financial stability. However, the low net assets (£275) and modest scale of operations with only 2 employees limit financial resilience. The reduction in current liabilities from 2023 to 2024 is a positive sign, but long-term creditors remain significant relative to net assets. Given the start-up nature and micro scale, credit approval should be conditional on ongoing monitoring of cash flow and timely filing of accounts.

2. Financial Strength:
   The balance sheet shows total current assets of £4,158 against current liabilities of £1,536, producing net current assets of £2,622, which is healthy for working capital coverage. However, the company has long-term liabilities of £2,347, leading to a modest net asset figure of £275. The equity base is very thin, which poses a risk if unexpected expenses or downturns occur. The company's total assets less current liabilities declined from £3,457 in 2023 to £2,622 in 2024, indicating some asset erosion or increased liabilities. Overall, the financial position is fragile but not impaired.

3. Cash Flow Assessment:
   Current assets primarily consist of cash, receivables, or inventory, supporting short-term liquidity. Net current assets are positive, suggesting the company can cover short-term obligations as they fall due. The increase in employees from 1 to 2 may raise payroll obligations but also indicates business growth. Limited details on profit or cash flow from operations are available, and the micro-entity status means less disclosure. It is advisable to confirm adequate cash flow generation or access to funding sources to service liabilities and support growth.

4. Monitoring Points:

• Track net current asset trends and ensure they remain positive to maintain liquidity.
• Monitor long-term liabilities and any changes in creditor terms or amounts.
• Watch for timely filing of accounts and confirmation statements to avoid compliance risk.
• Review profit/loss trends and cash flow statements when available to assess operational performance.
• Evaluate management's ability to grow the business and strengthen the equity base.