SPHERE BUILDING SOLUTIONS LTD

Executive Summary

Sphere Building Solutions Ltd is a very young micro-entity with a negative net asset position and substantial related party debt. The company shows no operational cash flow or employees, relying on director-related support to continue as a going concern. Given the lack of financial strength and liquidity, credit facilities are not recommended at this time until a proven trading history and improved financial metrics emerge.

SPHERE BUILDING SOLUTIONS LTD - Analysis Report

Company Number: 14928136

Analysis Date: 2025-07-20 13:19 UTC

1. Credit Opinion: DECLINE
   Sphere Building Solutions Ltd is a newly incorporated micro-entity with a negative net asset position (£-4,837) and significant working capital deficiency (£-117,626). The bulk of its liabilities (£116,506) are owed to a related party (Sphere Energy Solutions Ltd), which has agreed to defer repayment for at least one year. However, the absence of trading activity (no employees and minimal current assets of £2,258) and negative equity raise concerns about the company’s ability to generate sufficient cash flow to meet obligations or service any external debt. Without evidence of operational revenue or external financing, the credit risk is high and the company lacks financial resilience at this stage. Therefore, credit facilities should be declined until a proven trading record and improved financial position are established.

2. Financial Strength:
   The balance sheet shows fixed assets of £112,789, but current liabilities of £119,884 far exceed current assets of £2,258, resulting in a large net current liabilities deficit. The negative shareholders’ funds reflect accumulated losses or start-up costs exceeding equity contributed. The company's going concern status depends heavily on related party support, which is not a sustainable funding source for external creditors. Overall, the financial strength is weak, with no buffer to absorb operational or market risks.

3. Cash Flow Assessment:
   Current assets are minimal and primarily likely to be cash or receivables, while immediate liabilities are large and mainly related party debt. The company has no employees and likely no operating cash inflows yet, indicating negative or negligible operating cash flow. Working capital is severely negative, and liquidity is constrained. The reliance on related party deferment of liabilities masks underlying cash flow difficulties. The company’s ability to meet short-term commitments without additional capital injection or operational revenue is doubtful.

4. Monitoring Points:

• Track trading revenue and gross margin development to assess operational viability.
• Monitor changes in working capital and related party balances to detect any worsening liquidity.
• Watch for external funding or capital injections improving net asset position.
• Review subsequent filings for evidence of improved financial performance or operational scale-up.
• Assess any change in director or shareholder structure that could impact governance or creditworthiness.