RILEC LIMITED

Executive Summary

Rilec Limited is a micro-entity engaged in building project development, showing early signs of liquidity pressure with a shift to net current liabilities in the latest financial year. Despite a reduction in net assets, the company remains compliant with regulatory requirements and maintains stable governance under a sole director. Further investigation into operational profitability and working capital management is recommended to fully assess financial stability.

RILEC LIMITED - Analysis Report

Company Number: 13223542

Analysis Date: 2025-07-29 12:17 UTC

1. Risk Rating: MEDIUM
   The company shows a decline in net assets and working capital in the latest financial year, with net current liabilities emerging, which raises moderate solvency and liquidity concerns. However, it remains operational and compliant with filings, which mitigates immediate high risk.

2. Key Concerns:

• Decline in Net Current Assets: The company moved from a positive net current asset position (£4,801 in 2024) to a net current liability of £632 in 2025, indicating potential short-term liquidity stress.
• Decreasing Net Assets: Net assets have fallen from £12,649 in 2024 to £10,305 in 2025, suggesting erosion of equity possibly due to operational losses or asset write-downs.
• Limited Scale and Capital: With only £1 share capital and a single director, the company is small-scale and potentially vulnerable to financial shocks or reliance on key personnel.

3. Positive Indicators:

• Compliance and Timely Filings: No overdue accounts or confirmation statements, indicating good regulatory adherence.
• Established Director and Stable Governance: Single director with consistent occupation and address, suggesting stable management with no disqualifications or governance red flags noted.
• Micro-Entity Status: Simplified reporting and low overheads may support lean operations and reduce administrative burden.

4. Due Diligence Notes:

• Investigate Causes of Working Capital Decline: Review underlying reasons for increased current liabilities and reduced current assets, including trade payables, debtor collections, or cash management.
• Examine Profit and Loss Trends: Access P&L data to determine if net asset decline is due to operational losses, extraordinary items, or accounting adjustments.
• Assess Funding and Capital Structure: Understand if additional funding sources exist beyond the minimal share capital to support operations or absorb shocks.
• Review Contracts and Project Pipeline: Given SIC code 41100 (development of building projects), assess project backlog, client receivables, and exposure to market fluctuations.