Company Number: 14866658

Analysis Date: 2025-07-29 16:08 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   Sheppard Creative Design Ltd is a very young micro-entity operating in specialised design activities. The latest filed accounts show a significant deterioration in liquidity and net current assets from the prior year, with net current liabilities of £3,574 at 31 May 2025 compared to net current assets of £2,946 the previous year. Although the company remains solvent with positive net assets of £1,028, the sharp decline in working capital and current asset base raises concerns about short-term cash flow pressures. Given the company has only one employee and is controlled wholly by the director, Thomas Matthew Sheppard, the credit decision should be conditional on obtaining further assurances on cash flow projections and possibly personal guarantees or collateral to mitigate risk.

2. Financial Strength:
   The balance sheet shows limited fixed assets (£5,397) and a small overall asset base. The decline in net assets from £5,720 to £1,028 over one year reflects a loss or reduction in reserves, which weakens equity cushions. The company’s capital structure is entirely equity funded by the single shareholder/director. The micro-entity status limits the amount of financial information available, but the shrinking net assets and worsening working capital position suggest the business is under financial strain and may lack resilience to shocks.

3. Cash Flow Assessment:
   Current liabilities exceed current assets by £3,574 at the latest year-end, indicating negative working capital and potential liquidity constraints. This means the company may struggle to meet short-term obligations without additional funding. The prior year showed a positive working capital position, so the reversal is concerning and warrants close monitoring. Cash flow from operations is not disclosed but is likely under pressure given the reduction in current assets (notably trade debtors or cash equivalents). The small scale and single employee model may limit operational flexibility.

4. Monitoring Points:

• Monthly cash flow statements and forecasts to track liquidity trends.
• Payment performance on trade creditors and any late payments or defaults.
• Updates on any additional funding or capital injections by the director.
• Business development progress to improve revenue and working capital.
• Director’s credit history and any changes in management or control.
• Timely filing of future accounts and confirmation statements to maintain compliance.