Credit Analysis: SIMPLY SOLVE IT LIMITED (08594424)

1. Credit Opinion: DECLINE

Reasoning: The company is currently in Liquidation status and is insolvent on both a balance sheet and likely a cash flow basis. Shareholders' funds are negative (£-22,513 as at July 2024), and current liabilities (£95,122) substantially exceed current assets (£53,493), leaving a working capital deficit of approximately £-41,629. The company has zero employees and both statutory filings are overdue. No credit facility should be extended to an entity in formal insolvency proceedings.

2. Financial Strength: Severely Impaired

Balance Sheet Deterioration: The company has experienced a dramatic decline in financial position:

Key Concerns: - Negative equity for two consecutive years indicates the company's liabilities exceed its assets - Creditors due within one year surged from £42,837 (2023) to £95,122 (2024) – a 122% increase year-on-year - Fixed assets jumped from £11,378 to £50,123, which appears anomalous for a company in liquidation with zero employees – this warrants scrutiny regarding asset valuation and classification - Share capital remains at just £2, demonstrating minimal shareholder investment throughout the company's life

Insolvency: The company is balance sheet insolvent and, given the working capital deficit, is also likely unable to pay its debts as they fall due (cash flow insolvency).

3. Cash Flow Assessment: Critical

Working Capital Position:

• The working capital position has deteriorated dramatically from a marginal deficit in 2023 to a substantial deficit in 2024
• Cash reserves have been depleted – from £88,249 in 2021 to just £2,777 in 2022 (no cash figure reported for 2023/24, which is concerning)
• Zero employees in both 2023 and 2024 suggests the business has ceased trading operations
• The company has no apparent revenue-generating capacity to service existing obligations, let alone new debt

4. Monitoring Points

If any residual exposure exists or if directors approach for new ventures, the following should be monitored:

• Liquidation status: Confirm the exact stage of liquidation and identify the appointed liquidator
• Director conduct: Directors Paul Towler and Mark Lee remain active on the register – monitor for new directorships or phoenix activity
• Overdue filings: Both accounts and confirmation statement are overdue, indicating administrative failure or abandonment
• Creditor position: The significant increase in short-term creditors may indicate unpaid trade creditors, HMRC liabilities, or director-related balances
• Asset verification: The unexplained increase in fixed assets warrants investigation – potential for overstated or misclassified assets

Summary Assessment