Company Number: 14906114

Analysis Date: 2025-07-20 18:17 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   SOPAM PROPERTIES LTD is a newly incorporated micro-entity operating in real estate management and trading. The company shows a negative net asset position (£-68,565) due to significant long-term creditors (£188,780), which exceeds its total assets. However, the director has explicitly committed to ongoing financial support, and current liabilities are low relative to current assets, suggesting short-term liquidity is manageable. Credit approval is recommended on a conditional basis, subject to continued director support and monitoring of debt levels and operational cash flows.

2. Financial Strength:
   The company holds fixed assets of £63,087 and current assets of £62,668, offset by current liabilities of only £5,540, resulting in a healthy net current asset position of £57,128. Nonetheless, the substantial long-term liabilities heavily impact net asset value, resulting in negative shareholders’ funds of £68,565. This weak equity base reflects reliance on external financing and director backing rather than accumulated profits. As a micro-entity in its first year, limited financial history restricts trend analysis. The balance sheet shows asset coverage over current liabilities but highlights risk from long-term debt.

3. Cash Flow Assessment:
   Current assets exceed current liabilities, indicating adequate short-term liquidity to meet immediate obligations. The company’s working capital position is positive at £57,128, which supports operational needs. However, the accounts do not provide direct cash flow statements, and with only one employee, operational scale is minimal. The director’s commitment to financial support mitigates potential liquidity risks. It is critical to confirm actual cash inflows and outflows as the business develops to ensure sustainable cash generation and debt servicing capacity.

4. Monitoring Points:

• Track changes in long-term liabilities and the company’s ability to reduce or refinance this debt.
• Monitor net asset position for improvement through retained earnings or capital injection.
• Review director’s ongoing financial support and any related party transactions.
• Assess cash flow statements when available to evaluate operational cash generation.
• Keep watch on payment behavior with suppliers and creditors, especially given the negative equity.
• Evaluate impact of any change in market conditions on property valuations and rental income.