SIPKUBE LIMITED

Executive Summary

SIPKUBE LIMITED exhibits high solvency and liquidity risk due to persistent negative net assets and working capital deficits over three years, primarily financed by director loans. While regulatory compliance is maintained, the company’s financial position raises concerns about its operational sustainability without additional capital or improved cash flows. Further investigation into director funding terms and business viability is recommended.

SIPKUBE LIMITED - Analysis Report

Company Number: 13821911

Analysis Date: 2025-07-20 16:25 UTC

1. Risk Rating: HIGH
   The company shows persistent net liabilities and negative shareholders’ funds over three consecutive years, indicating ongoing solvency concerns. Its current liabilities exceed current assets, reflecting a working capital deficit and potential liquidity stress.

2. Key Concerns:

• Negative Net Assets and Shareholders’ Funds: The company has net liabilities of approximately £1,887 at the latest year-end, worsening from prior years, which signals an erosion of capital and potential inability to absorb losses or sustain operations without external support.
• Working Capital Deficit: The net current assets are negative (£-1,887), meaning current liabilities exceed current assets, posing short-term liquidity risks and potential cash flow difficulties meeting immediate obligations.
• Director Loans as Creditors: A significant portion of current liabilities (£1,648 of £1,887 total) is owed to the director. This related-party debt could imply reliance on director funding to maintain solvency rather than operational cash flow generation.

3. Positive Indicators:

• No Overdue Filings or Compliance Issues: Accounts and confirmation statements are filed on time, indicating regulatory compliance and governance diligence.
• Single Director with Full Control: Clear ownership and control by one director may enable swift decision-making and potential access to further financial support if needed.
• Small Company Filing and Exemption from Audit: The company qualifies for small company exemptions, reducing administrative burden and costs.

4. Due Diligence Notes:

• Investigate the nature and terms of the director loans: Are they repayable on demand? Interest bearing? What is the sustainability of this funding?
• Review the company’s cash flow forecasts and funding plans to understand how it intends to manage its negative working capital and net liabilities going forward.
• Assess the business model and operational performance given the SIC codes in IT and telecommunications; determine revenue streams and profitability outlook since turnover and profit/loss figures are not disclosed.
• Clarify the reason for persistent losses or negative reserves and whether there is an intention or plan to recapitalise the company.