Company Number: 13123082

Analysis Date: 2025-07-20 12:21 UTC

1. Risk Rating: MEDIUM
   Justification: The company shows a decline in net assets and net current assets over recent years, with a notable drop from £38,835 in 2023 to £30,712 in 2024 for net assets, and a sharper decline in net current assets from £8,988 to £1,683. While still solvent, the narrowing working capital buffer poses liquidity concerns in the short term. The small scale of operations and micro-entity status limit detailed financial transparency.

2. Key Concerns:

• Liquidity tightening: Current liabilities increased while current assets decreased slightly, reducing net working capital significantly, which could strain day-to-day cash flow.
• Declining net assets: A drop of over £8,000 in net assets within one year may indicate operational losses or asset impairments not detailed here.
• Limited cash reserves: No explicit cash figure disclosed for 2024; prior year cash was modest (£4,045), raising questions about immediate liquidity availability.

3. Positive Indicators:

• Positive net assets and net current assets: The company remains solvent with assets exceeding liabilities.
• Consistent fixed asset base: Fixed assets have remained relatively stable, suggesting no heavy write-downs or disposals.
• Stable workforce: Employee numbers steady at 5, indicating operational continuity without drastic scaling down.

4. Due Diligence Notes:

• Review detailed profit and loss account to understand causes of net asset decline and assess profitability trends.
• Assess cash flow statements if available to confirm liquidity position and timing of liabilities.
• Investigate debtor quality as prior years show substantial debtors which may impact cash realization.
• Verify that all statutory filings continue to be timely to confirm regulatory compliance.
• Consider the business impact of the COVID-19 pandemic or other external factors given the hospitality sector SIC code (licenced restaurants).