Company Number: 13874122

Analysis Date: 2025-07-20 13:31 UTC

Credit Opinion:
CONDITIONAL APPROVAL. Riaz Law Ltd is a recently incorporated private limited company operating in the solicitors sector. While the company shows positive net current assets and shareholders’ funds as of the latest accounts, its liquidity is tight with current liabilities nearly matching current assets. Approval for credit facilities should be conditional on monitoring improved cash flow management and ensuring timely payments to creditors.

Financial Strength:
The balance sheet as at 31 October 2023 shows total assets less current liabilities of £19,988 and shareholders’ funds of the same amount, indicating the company is solvent. Tangible fixed assets of £18,367 represent most of the net assets, while net current assets are minimal at £1,621. Current liabilities are substantial (£150,689), mostly comprising taxation and social security liabilities (£39,045) and other creditors (£111,644). The company’s retained earnings of £19,688 reflect accumulated profits, but the relatively high short-term liabilities compared to current assets suggests limited financial buffer.

Cash Flow Assessment:
Cash on hand and at bank stands at £106,354, which provides some liquidity cushion. However, current liabilities at £150,689 are slightly higher than current assets (£152,310) but the net current asset position is narrow (£1,621). Debtors amount to £45,956, with £42,500 being amounts recoverable on contract, suggesting some receivables are tied to ongoing work. The company employs 2 people on average, indicating a small operational scale. Overall, cash flow appears constrained, and working capital management will be critical to meet short-term obligations.

Monitoring Points:

• Monitor the ageing of debtors and timely collection of contract receivables to improve cash inflows.
• Track settlement of current liabilities, especially accrued taxation and social security, to avoid enforcement action.
• Watch ongoing profitability and retained earnings growth for strengthening equity.
• Review cash flow forecasts regularly to ensure liquidity remains sufficient for operational needs.
• Keep abreast of any changes in director appointments or ownership that could impact governance or financial control.