Company Number: 13841702

Analysis Date: 2025-07-29 20:23 UTC

1. Risk Rating: MEDIUM
   RHSF Contracting Ltd shows a stable micro-entity profile with positive net current assets and shareholders’ funds, but there is a marked decline in net assets from the prior year and some increase in short-term liabilities, which introduces moderate solvency and liquidity risk. The company’s very recent incorporation (2022) and limited financial history further constrain risk assessment confidence.

2. Key Concerns:

• Declining Net Assets: Net assets decreased from £12,665 in 2023 to £5,730 in 2024, indicating a reduction in equity that may reflect operational losses or increased liabilities.
• Increased Current Liabilities: Current liabilities nearly doubled from £13,810 to £27,039 year-over-year, compressing working capital and potentially signaling cash flow pressures.
• Limited Operating History: Incorporated in early 2022 with only two years of financial data limits the ability to evaluate long-term operational stability and performance trends.

3. Positive Indicators:

• Positive Net Current Assets: Despite the increase in liabilities, net current assets remain positive at £5,069, suggesting the company can meet short-term obligations presently.
• No Overdue Filings: Accounts and confirmation statements are filed on time, indicating good compliance with regulatory obligations.
• Clear Control Structure: The company has a straightforward ownership and management structure with no director disqualifications reported, which reduces governance risk.

4. Due Diligence Notes:

• Financial Performance Details: Obtain profit and loss accounts and cash flow statements to understand the causes behind the decline in net assets and increase in liabilities.
• Debt Maturity Profile: Clarify the nature and repayment terms of the £6,750 long-term creditors and assess any covenant or refinancing risk.
• Client and Revenue Stability: Investigate client contracts and revenue sources given the company’s IT consultancy SIC code, to evaluate operational sustainability.
• Director and Shareholder Background Checks: Further background inquiries on the main controlling individuals for any undisclosed risks.
• Future Business Plans: Review management’s strategy and forecasts to assess prospects for reversing the asset decline and improving liquidity.