RM DESIGN GROUP LIMITED

Executive Summary

RM Design Group Limited is a recently established small design company with a positive net asset position and adequate cash reserves. However, its significant tax liabilities and long-term lease commitments pose potential liquidity risks. The limited financial history restricts comprehensive assessment, warranting further due diligence on profitability and cash flow before investment.

RM DESIGN GROUP LIMITED - Analysis Report

Company Number: 14364983

Analysis Date: 2025-07-20 13:52 UTC

1. Risk Rating: MEDIUM
   RM Design Group Limited is a newly incorporated small private company with modest net assets and positive working capital. However, it carries significant current liabilities primarily composed of taxation and social security, and has substantial lease commitments. The company’s short trading history and absence of profit and loss data limit assessment of operational performance, contributing to a medium risk rating.

2. Key Concerns:

• Taxation and Social Security Payables: Current liabilities include £36,886 in taxation and social security, representing a significant portion of total liabilities that may pressure cash flow if not managed prudently.
• Lease Obligations: Operating lease commitments total £53,100 over the next five years, which could strain liquidity if revenue generation is inconsistent.
• Limited Financial History: Incorporated in September 2022 with only one set of unaudited accounts available, lacking profit and loss data, making it difficult to assess profitability and cash flow sustainability.

3. Positive Indicators:

• Positive Net Current Assets: Net current assets of £11,084 indicate the company currently has sufficient short-term assets to cover its immediate liabilities.
• Cash Reserves: Cash on hand is £30,867, providing a reasonable liquidity buffer for ongoing operations.
• Shareholder Support and Control: The two directors hold majority shares and voting rights, which may facilitate decisive management and alignment of interests.

4. Due Diligence Notes:

• Profitability and Cash Flow: Obtain the detailed profit and loss accounts and cash flow statements for the period to assess operational viability and cash generation capability.
• Taxation Detail: Verify the nature and timing of taxation and social security liabilities to understand payment schedules and any potential risks of penalties or enforcement.
• Lease Terms: Review lease agreements to assess flexibility, escalation clauses, and impact on long-term financial commitments.
• Director Background Checks: Confirm there are no adverse regulatory actions or disqualifications related to the directors, given their significant control.