Company Number: 15054806

Analysis Date: 2025-07-20 12:50 UTC

1. Credit Opinion: CONDITIONAL APPROVAL Stratagem Defence Limited is a newly incorporated micro-entity with limited operating history (incorporated August 2023). The latest unaudited accounts show positive net current assets and shareholders’ funds, indicating initial capital adequacy. However, the company’s small size, early stage, and limited financial track record warrant cautious lending. Approval is recommended with conditions including ongoing monitoring of trading performance, timely filing of accounts and returns, and possibly requiring personal guarantees or collateral given the modest asset base and working capital.

2. Financial Strength: The balance sheet as of 31 August 2024 shows fixed assets of £1,892 and current assets of £44,115 against current liabilities of £31,634, resulting in net current assets of £12,481 and total net assets/shareholders’ funds of £14,373. This indicates a positive but modest equity base and working capital position consistent with a micro-entity start-up. The company’s capital structure is entirely equity-funded with no long-term debt reported, which reduces gearing risk at this stage.

3. Cash Flow Assessment: Current assets primarily include cash and debtors totaling £44k, which exceeds short-term liabilities of nearly £32k by a working capital margin of £12.5k. This suggests that the company has sufficient liquidity to meet immediate obligations. However, as a start-up with only two employees, cash flow stability and cash burn rate should be closely monitored. No detailed cash flow statement is available, so operational cash generation capacity remains unproven.

4. Monitoring Points:

• Timely filing of next accounts and confirmation statement to ensure compliance.
• Tracking revenue growth and profitability trends to confirm business viability.
• Monitoring working capital trends and management of current liabilities.
• Review of director conduct and any related party transactions to assess governance.
• Watch for any increases in debt levels or delayed payments which may signal cash flow stress.