Company Number: 12879632

Analysis Date: 2025-07-29 19:37 UTC

1. Risk Rating: HIGH
   This company exhibits significant solvency risk as evidenced by persistent negative shareholders' funds (net liabilities). Current liabilities substantially exceed current assets, indicating severe liquidity stress. The financial position has deteriorated slightly year on year, with net liabilities increasing from £15.4k to £20.5k.

2. Key Concerns:

• Negative Shareholders’ Funds: The company has a continuing deficit in equity, indicating that liabilities exceed assets, which questions solvency.
• Working Capital Deficit: Net current liabilities of over £1.1 million highlight short-term liquidity issues and potential difficulty meeting immediate obligations.
• Reliance on Director or External Support: No PSC is disclosed, and the recent appointment of a director with a non-business occupation (teacher) may suggest lack of commercial management experience or a need to investigate governance and operational structure.

3. Positive Indicators:

• Timely Filings: The company is current on both accounts and confirmation statement filings, indicating compliance with statutory requirements.
• Stable Fixed Assets: The value of fixed assets remains relatively stable, suggesting some underlying asset base backing the business.
• Small Company Status: As a micro entity, the company benefits from simplified reporting requirements, which may reduce administrative burdens.

4. Due Diligence Notes:

• Review detailed cash flow data and creditor payment history to assess liquidity management and risk of default.
• Investigate the nature and terms of the substantial current liabilities, including whether these are trade payables, loans, or other financial obligations.
• Clarify ownership and control structure given absence of PSC information, and assess director expertise and involvement to understand operational oversight.
• Examine any contingent liabilities or off-balance sheet commitments that could exacerbate financial risk.
• Consider reasons behind persistent losses or negative reserves, including business model viability in the real estate sector.