Company Number: 13030859

Analysis Date: 2025-07-20 13:02 UTC

1. Risk Rating: HIGH
   The company shows persistent negative net current assets and shareholders’ funds over the last four years, indicating ongoing solvency pressures. The reliance on significant intercompany balances and related party transactions further raises concerns about financial stability and liquidity.

2. Key Concerns:

• Negative Net Current Assets and Shareholders’ Funds: The company has reported net current liabilities of £117,224 as of 2023, and shareholders’ funds remain negative at £113,884 despite some improvement from prior years. This points to a continuing deficit in working capital and overall net liabilities exceeding assets.
• High Related Party Balances and Dependence: A large portion of debtors and creditors are amounts owed to and by group undertakings and related entities, suggesting the company’s liquidity and solvency are heavily dependent on intra-group funding and transactions. This concentration risk could be problematic if group support weakens.
• Limited Cash Reserves: Cash holdings are negligible (£230 in 2023), indicating potential liquidity constraints for meeting short-term obligations without group support or timely collection of receivables.

3. Positive Indicators:

• No Overdue Filings: The company has up-to-date accounts and confirmation statements, reflecting compliance with statutory filing obligations and governance requirements.
• Going Concern Basis Maintained: The directors state that the accounts are prepared on a going concern basis, supported by continued funding from the parent company, which suggests underlying operational support presently exists.
• Stable Employee Base: The number of employees remained consistent at 4, indicating operational stability at a small scale.

4. Due Diligence Notes:

• Investigate the nature and terms of intercompany balances, including repayment schedules and any guarantees, to assess the sustainability of related party funding arrangements.
• Examine cash flow forecasts and working capital management practices to evaluate the company’s ability to meet short-term liabilities independently of group support.
• Review the parent company’s financial health and commitment to continued funding, given the company’s reliance on this support for going concern.
• Assess the quality and collectability of debtors, especially amounts owed by group undertakings, to determine the risk of potential write-downs.
• Confirm absence of director disqualifications or regulatory issues, although none appear from the current data.