Company Number: 13788471

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

1. Risk Rating: HIGH
   The company exhibits significant solvency and liquidity concerns as evidenced by its negative net current assets and shareholders' funds in the most recent financial year. The deterioration from a nominal positive equity position in 2022 to a substantial net liability position in 2023 is a key red flag.

2. Key Concerns:

• Negative Net Current Assets and Net Liabilities: As of 31 December 2023, the company reported net current liabilities of £6,003 and net assets of -£4,807, indicating an inability to cover short-term obligations with current assets.
• Declining Financial Position: The company’s financial health has worsened sharply from a marginal positive net asset position (£2) in 2022 to a significant deficit, suggesting operational losses or write-downs.
• Negative Debtors Balance: The reported debtors figure is negative (-£729), which is unusual and may indicate accounting anomalies or unresolved receivable issues requiring clarification.

3. Positive Indicators:

• Compliance with Filing Requirements: The company’s accounts and confirmation statements are up to date with no overdue filings, indicating good regulatory compliance.
• Single Director and PSC Stability: The sole director and 100% shareholder is consistent, which may facilitate swift decision-making and control.
• Exemption from Audit: The company qualifies for small company audit exemption, which is typical for micro-entities and reduces administrative burden.

4. Due Diligence Notes:

• Investigate the nature and cause of the negative debtor balance to understand if this reflects accounting errors, corrections, or disputes.
• Assess the company’s operational cash flow and future revenue projections to determine if the negative net asset position is due to temporary issues or structural problems.
• Review director’s advances or loans to the company and their impact on the financials, since loans to directors were mentioned but not quantified in detail.
• Obtain more detailed management accounts, if available, to evaluate current trading performance and cash flow trends beyond the year-end snapshot.
• Clarify whether any contingent liabilities or related party transactions exist that may affect solvency.