Company Number: 13030315

Analysis Date: 2025-07-20 12:54 UTC

1. Risk Rating: MEDIUM
   The company maintains positive net assets and current net assets but shows a declining trend in shareholders' funds and working capital. Current liabilities have increased relative to current assets, and cash balances are very low, indicating potential liquidity pressure.

2. Key Concerns:

• Declining Net Assets: Shareholders' funds decreased from £11,150 (2023) to £6,492 (2024), signaling erosion of equity possibly due to losses or increased liabilities.
• Low Cash Reserves: Cash on hand dropped sharply to £427 (2024) from £30,110 (2021), raising concerns about the company’s ability to meet immediate cash obligations.
• Increased Short-Term Creditors: Current liabilities rose from £10,285 (2023) to £13,566 (2024), with "Other creditors" more than doubling, potentially indicating delayed payments or increased short-term debt reliance.

3. Positive Indicators:

• Positive Net Current Assets: Despite liquidity concerns, the company still reports positive net current assets (£1,703) at year-end 2024.
• Compliance with Filing Requirements: No overdue filings for accounts or confirmation statements, suggesting good regulatory compliance and governance.
• Tangible Fixed Assets: The company holds £12,478 in net tangible fixed assets, indicating operational capacity and investment in plant and machinery.

4. Due Diligence Notes:

• Investigate the causes of the significant decline in cash balances and shareholders’ funds over the last year, including any losses or write-downs not detailed in the balance sheet.
• Review the composition and aging of debtors and creditors, especially the increase in "Other creditors," to assess payment terms and possible liquidity pressures.
• Examine the company's income statement and cash flow statements (not provided) for profitability trends, cash generation capacity, and any contingent liabilities.
• Confirm whether the hire purchase contracts (totaling £11,689) are appropriately serviced and the impact on cash flow.
• Assess director’s plans to restore equity and liquidity given the downward trend in net assets.