Company Number: SC718325

Analysis Date: 2025-07-29 15:16 UTC

1. Risk Rating: MEDIUM
   The company shows a near breakeven net liability position (-£420) with a significant increase in liabilities after more than one year. While it holds substantial investment property assets, the heavy reliance on secured loans and net liabilities suggest moderate solvency and liquidity risk.

2. Key Concerns:

• Net Liabilities Position: The company reported net liabilities of £420 as of 31 March 2024, improving from -£19,029 the prior year, but still indicating no positive equity.
• High Long-Term Creditors: Creditors due after more than one year total £1,452,336, comprising bank loans secured on investment property (£627,078) and other creditors (£825,258), which has increased notably from the previous year (£949,364). This growing debt burden could strain future cash flows.
• Limited Operational Data and Single Director: The company has only one employee (the director) and limited turnover information provided. The business appears to be a property holding entity with no significant trading, which may affect operational sustainability if rental income or asset values decline.

3. Positive Indicators:

• Strong Asset Backing: Investment property valued at £899,923 remains stable year-over-year, providing a tangible asset base backing the company’s liabilities.
• Improved Cash Position: Cash at bank increased substantially from £16,698 to £539,479, significantly improving short-term liquidity.
• Timely Compliance: The company is active and up to date with all filing deadlines for accounts and confirmation statements, indicating good regulatory compliance.

4. Due Diligence Notes:

• Verify Nature and Terms of Other Creditors: The significant increase in "other creditors" from £322,258 to £825,258 needs clarification—whether these are related party loans, deferred payments, or trade payables.
• Assess Cash Flow Stability: Review rental income streams and any covenants on the bank loan secured against the investment property to assess sustainability of debt servicing.
• Confirm Valuation Methodology: The investment property valuation is director-assessed; an independent valuation would provide more assurance regarding asset values.
• Examine Profit & Loss Account Details: Limited information on turnover and profitability is available; reviewing detailed P&L would clarify operational performance and revenue sources.
• Review Director’s Financial Support: Given the company’s net liability status and director’s sole control, investigate any ongoing financial support or guarantees provided by the director.