Company Number: 13439704

Analysis Date: 2025-07-29 16:17 UTC

1. Risk Rating: HIGH
   The company exhibits significant financial distress as evidenced by persistent negative net assets and net current liabilities over multiple years. The high level of director's loan account within current liabilities further exacerbates solvency concerns.

2. Key Concerns:

• Solvency Risk: The company has negative net assets of approximately £10,500 consistently over the past four years, indicating liabilities exceed assets and potential insolvency risk.
• Liquidity Concerns: Net current liabilities stand at around £16,000 to £18,000, with very low cash balances (~£435), implying insufficient liquid resources to meet short-term obligations.
• Dependence on Director Loans: A significant portion (£18,597 in 2024) of current liabilities is a director’s loan account, indicating reliance on director financing which may not be sustainable or formalized.

3. Positive Indicators:

• Compliance: The company is up to date with its statutory filings and accounts, with no overdue returns or accounts.
• Operating Status: The company remains active with no signs of liquidation or administration.
• Consistent Accounting Practices: Use of appropriate accounting standards (FRS 102 section 1A) and clear disclosures in accounts.

4. Due Diligence Notes:

• Investigate the nature and terms of the director’s loan account to assess repayment expectations and any formal agreements.
• Review cash flow statements and trading performance to understand revenue generation capacity and operational viability, as turnover figures are not provided.
• Explore any off-balance sheet liabilities or contingent liabilities that may further impact solvency.
• Confirm whether there are any plans or arrangements to recapitalize or restructure the balance sheet to address negative equity.
• Assess the business model and market positioning given the SIC code (96020 - hairdressing and beauty treatment) and the absence of employees, which may affect sustainability.