Company Number: 14780480

Analysis Date: 2025-07-29 19:54 UTC

1. Risk Rating: HIGH
   The company demonstrates significant solvency risk as evidenced by net liabilities of £36,066 within its first financial year. Negative shareholders’ funds combined with net current liabilities indicate an inability to cover short-term obligations from current assets, raising concerns over financial stability.

2. Key Concerns:

• Negative Net Assets: The balance sheet shows net liabilities of £36,066, suggesting the company’s liabilities exceed its assets, which is a critical solvency red flag.
• Working Capital Deficiency: Current liabilities (£113,786) exceed current assets (£55,875) by £57,911, indicating potential liquidity problems that could impair meeting short-term debts.
• Long-term Creditors: The company has £60,000 in creditors due after more than one year, which further burdens the capital structure given the negative equity position.

3. Positive Indicators:

• Active Status and Compliance: The company is active with no overdue filings for accounts or confirmation statements, showing adherence to statutory requirements.
• Clear Ownership and Governance: Timothy Cheng holds majority control with full voting rights and director appointment powers, which may facilitate swift decision-making.
• Initial Establishment Phase: The company is newly incorporated (April 2023) and classified as a micro-entity, which may explain early-stage financial strain common in startups.

4. Due Diligence Notes:

• Examine Cash Flow and Profit & Loss: The absence of a profit and loss account in the filings limits insight into operational performance; reviewing internal management accounts or bank statements would clarify cash flow adequacy.
• Assess Debt Terms: Investigate the nature and terms of the £60,000 long-term creditors and other liabilities to understand repayment obligations and flexibility.
• Review Business Plan and Revenue Streams: Given the negative equity and liquidity shortfall, understanding the underlying business model, client acquisition, and revenue projections is critical to assess sustainability.
• Director Background Checks: While no disqualifications are noted, verifying the directors’ experience and any related party transactions may uncover governance risks.