Risk Assessment: SCREEN VENTURES FILMS LIMITED

1. Risk Rating: HIGH

The company presents significant solvency and liquidity concerns despite its continued operation and compliant filing history. Net current liabilities of £56,414, extremely thin equity of just £7,022 against total liabilities of £133,947 (a 95% leverage ratio), and a documented history of negative net assets spanning multiple years collectively elevate the risk profile. The micro-entity reporting regime further limits visibility into the quality and composition of assets and liabilities.

2. Key Concerns

a) Severe Liquidity Shortfall Current assets of £77,533 are insufficient to cover creditors due within one year (£133,947), leaving net current liabilities of £56,414. The company cannot meet its short-term obligations from its current asset base, creating dependency on the timing of cash inflows, refinancing, or continued creditor forbearance.

b) Dangerously Thin Equity Cushion Net assets of £7,022 represent approximately 5% of total liabilities. A modest asset impairment or unexpected liability would erase equity entirely and return the company to the technically insolvent position it held from at least 2016 through 2019. The historical negative equity period (£-25,935 at its worst in 2018) demonstrates this vulnerability is not hypothetical.

c) Unexplained Asset Volatility and Composition Uncertainty Total assets jumped from £27,379 (2021) to £122,244 (2022) — an increase of approximately £95,000 — with fixed assets now constituting £63,436. For a film production micro-entity with one employee, the nature and recoverability of these fixed assets is unclear. Micro-entity accounts provide no breakdown, leaving significant blind spots regarding asset quality.

3. Positive Indicators

• Filing Compliance: Accounts to 31 August 2025 are filed and not overdue; confirmation statement is current. This suggests the director is maintaining statutory obligations.

• Trajectory of Improvement: Net assets have moved from deeply negative (£-25,935 in 2018) to positive since 2021, indicating some form of restructuring, capital injection, or asset revaluation occurred.

• Longevity: The company has been active since 2010, demonstrating survival through prior insolvency periods. This may indicate creditor tolerance or underlying business viability not fully captured in the balance sheet.

• Stable Liability Levels: Total liabilities have remained relatively flat year-on-year (£133,947 in 2025 vs £135,214 in 2024), suggesting no rapid deterioration or accumulation of new debt.

4. Due Diligence Notes