REBECCA PEARSON SPEECH AND LANGUAGE THERAPY LIMITED

Executive Summary

Rebecca Pearson Speech and Language Therapy Limited demonstrates stable operational growth and positive net assets but carries moderate liquidity and solvency risks due to high payroll-related liabilities and reliance on director advances and government-backed loans. The company is compliant with filing requirements, yet further analysis of debtor quality and cash flow management is advisable to fully assess financial sustainability. Investor caution is warranted pending deeper financial and operational review.

REBECCA PEARSON SPEECH AND LANGUAGE THERAPY LIMITED - Analysis Report

Company Number: 12624912

Analysis Date: 2025-07-19 12:05 UTC

1. Risk Rating: MEDIUM
   While Rebecca Pearson Speech and Language Therapy Limited shows positive net current assets and increasing net assets over recent years, the company also carries significant current liabilities, including a large PAYE and Social Security creditor. The unsecured director's loan and reliance on debt (including a Bounce Back Loan) create moderate solvency and liquidity concerns.

2. Key Concerns:

• Elevated current liabilities (£255,794) nearly matching current assets (£269,135), with a sizable PAYE & Social Security liability (£190,435), indicating potential cash flow strain.
• Substantial director’s loan account (£65,222 owed to the company by director) is interest-free and without a formal repayment plan, representing a contingent asset of uncertain realisation.
• Outstanding long-term debt (£14,803 Bounce Back Loan) reduces financial flexibility and adds leverage risk.

3. Positive Indicators:

• Net current assets positive (£13,341), showing working capital adequacy to cover short-term obligations.
• Progressive growth in net assets from £328 in 2021 to £3,556 in 2024, reflecting retained earnings accumulation.
• Regular and timely filing of accounts and confirmation statements, with no overdue filings or compliance issues.
• Stable business operations with increasing employee numbers (17 in 2024 vs. 14 prior year), indicating operational expansion.

4. Due Diligence Notes:

• Review detailed ageing of trade debtors (£155,000) and other debtors (£46,824) to assess collectability and any impairment risks.
• Assess cash flow statements (not provided) to confirm liquidity to meet PAYE and other liabilities due.
• Investigate terms and repayment plans related to the director’s loan to evaluate its recoverability and impact on financial health.
• Confirm ongoing viability of the Bounce Back Loan repayment schedule and potential refinancing risks.
• Examine management controls over payroll and tax liabilities given the high PAYE & Social Security creditor balance.