RGB BUTTERFLIES LTD

Executive Summary

RGB BUTTERFLIES LTD is a small, active private company operating in educational support services. While it maintains current statutory compliance and shows increased cash reserves, the sharp rise in current liabilities alongside declining net assets and debtors suggests moderate liquidity and solvency risks. Further investigation into the company’s financial operations and creditor composition is recommended to fully assess its sustainability.

RGB BUTTERFLIES LTD - Analysis Report

Company Number: 14121423

Analysis Date: 2025-07-29 17:25 UTC

1. Risk Rating: MEDIUM
   The company is active and compliant with filing deadlines, but the significant increase in current liabilities relative to current assets and reduced net current assets raise moderate solvency and liquidity concerns.

2. Key Concerns:

• Sharp increase in current liabilities from £6,840 (2023) to £15,997 (2024) with only a modest increase in current assets, reducing net current assets from £7,285 to £2,562, indicating potential liquidity strain.
• Marked decrease in debtors from £12,598 (2023) to £2,440 (2024), which may impact cash inflows or reflect collection issues.
• Retained earnings and shareholders’ funds have declined substantially (from £7,285 to £2,562), suggesting operational losses or distributions not detailed in the accounts.

3. Positive Indicators:

• The company remains current with statutory filings and shows no overdue accounts or confirmation statements.
• Cash at bank increased significantly from £1,527 (2023) to £16,119 (2024), which may provide some buffer against immediate liquidity pressures.
• Directors appear stable with no noted disqualifications or governance issues; the company is small, limiting complexity and risk exposure.

4. Due Diligence Notes:

• Verify the nature and timing of the increase in current liabilities, specifically the "other creditors" category, to assess whether these are trade-related or short-term financing obligations.
• Investigate the reason for the large drop in debtors and confirm collectability of outstanding amounts.
• Review the profit and loss details (not filed due to small company exemption) to understand operational performance and reason for reduction in retained earnings.
• Confirm the company’s business model viability given the SIC codes in education and sports education, and the impact of any market or regulatory changes since incorporation.
• Assess directors’ background and related-party transactions, given both directors share the same residential address and significant shareholding control.