Company Number: 14017243

Analysis Date: 2025-07-29 15:56 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   Studio Haran Ltd is a very young private limited company incorporated in 2022, operating in niche manufacturing sectors (furniture and ceramics). While it shows a positive net asset position and shareholders’ funds (£30,483 at 31/03/2024), the company’s current liabilities have increased significantly from £23,242 in 2023 to £102,664 in 2024, primarily due to a large directors’ current account balance (£30,003) and increased tax liabilities (£18,839). This elevated short-term liability level raises some liquidity concerns. The company’s cash position improved markedly to £89,523, which supports short-term liquidity, but the sharp increase in creditors suggests working capital management should be monitored closely. Credit approval can be granted conditionally, subject to ongoing monitoring of liquidity and debtor collection performance.

2. Financial Strength:
   The balance sheet shows modest fixed assets (£6,107 net book value) with current assets totaling £127,040, including stock (£26,993) and cash (£89,523). The company maintains positive net current assets (£24,376) but this has decreased slightly from prior year (£26,973). Shareholders’ funds remain stable around £30.5k, backed mainly by share premium rather than accumulated profits (the profit and loss account shows a nominal deficit of £28). The increase in creditors and directors’ current account suggests reliance on shareholder/director funding to manage liabilities. Overall, the company’s net asset position and equity base are adequate for a micro/small enterprise, but leverage and working capital dynamics warrant attention.

3. Cash Flow Assessment:
   Cash resources have strengthened significantly over the year from £4,791 to £89,523, indicating improved cash generation or injection of funds. However, trade debtors have decreased substantially (£26,189 to £10,524), which may reflect tighter credit control or lower sales on credit terms. Stock levels have increased (£19,235 to £26,993), tying up working capital in inventory. Current liabilities ballooned mainly due to tax and director’s account balances, indicating potential timing issues in payments. Liquidity ratios are reasonable but the concentration of liabilities in short-term creditors and director accounts poses some risk. The company should focus on managing creditor terms and debtor collections to maintain healthy cash flows.

4. Monitoring Points:

• Track director’s current account balance closely to ensure it does not indicate ongoing funding shortfalls or deferred payments.
• Monitor tax liabilities and corporation tax payment schedules to avoid penalties or cash flow strain.
• Review debtor aging and stock turnover to confirm efficient working capital management.
• Assess profitability trends as the company matures since the current P&L reserve shows a marginal loss.
• Confirm ongoing compliance with filing deadlines and regulatory obligations given the recent incorporation.