Company Number: 15516556

Analysis Date: 2025-07-20 12:05 UTC

1. Credit Opinion: APPROVE with conditions

Ruffett Accountancy Limited is a newly formed accountancy practice incorporated in early 2024. The company has filed its first set of accounts to February 2025, showing a modest but positive net asset position and net current assets. Given the company's nature as a small professional services business with limited fixed assets and low employee count (1 average), the financial scale is small but within the micro entity threshold. The presence of directors with relevant professional qualifications (one being a certified chartered accountant) supports competent management. However, as a startup with limited trading history and modest working capital, credit facilities should be provided on a conditional basis with close monitoring of cash flow and client receivables.

2. Financial Strength:

• Net assets stand at £6,427, reflecting a small equity base consistent with start-up capital.
• Tangible fixed assets are minimal (£1,208 net book value) mostly computer equipment.
• Current assets total £12,904, predominantly cash (£12,529) with minimal trade debtors (£375).
• Current liabilities are £7,685, mainly taxes and social security (£7,045), loans from directors (£49), and accruals (£591).
• Net current assets (working capital) are positive at £5,219, indicating the company currently has sufficient short-term resources to meet liabilities.
• Share capital is minimal, and profit and loss reserves are modest (£6,425), consistent with one year of operations.

3. Cash Flow Assessment:

• Cash at bank is healthy relative to liabilities, providing liquidity to cover short-term obligations.
• Trade receivables are low, which may reflect initial client billing levels or tight credit control.
• Tax and social security liabilities are significant relative to cash, indicating the company is meeting statutory obligations but may face timing risks.
• Loans from directors are minor, showing limited reliance on related-party funding.
• The small scale and minimal staffing reduce fixed overhead risk, but cash flow remains vulnerable to client payment delays or unexpected expenses.

4. Monitoring Points:

• Track ongoing cash flow closely, especially client payments and tax liabilities to ensure liquidity remains positive.
• Monitor revenue growth and profitability trends to assess whether working capital and equity strengthen over time.
• Watch for any increase in director loans or external borrowing that may indicate cash flow stress.
• Observe filing of future accounts and confirmation statements for compliance and updated financial performance.
• Assess client diversification and contract stability to gauge business resilience.