Company Number: 13889442

Analysis Date: 2025-07-20 18:27 UTC

1. Risk Rating: HIGH

Justification: The company exhibits a negative net asset position worsening over the last financial year, with net liabilities amounting to £3,256 as of 29 February 2024. The negative working capital position (net current liabilities of £5,180) alongside very low cash reserves (£1,547) highlights significant liquidity stress. The company’s continuation is heavily dependent on the director’s support as stated in the accounts, indicating it may not be self-sustaining operationally.

2. Key Concerns:

• Negative net assets and net current liabilities indicate insolvency risks and potential inability to meet short-term obligations without external support.
• Sharp decline in cash from £4,862 to £1,547 over the year, combined with current liabilities of £6,727, signals liquidity constraints.
• Reliance on director’s ongoing financial support for going concern status raises questions about operational sustainability and independence.

3. Positive Indicators:

• The company is compliant with filing requirements: accounts and confirmation statements are up to date and not overdue.
• The director and sole shareholder appears stable and engaged, with no noted disqualifications or governance issues.
• Small scale operation with only two employees suggests low operational complexity and overhead.

4. Due Diligence Notes:

• Verify the nature and extent of director’s support commitments and whether these are formalised or informal.
• Review detailed cash flow statements and management accounts to assess ongoing operational cash generation or burn rate.
• Investigate any contingent liabilities or off-balance-sheet obligations not reflected in the abridged accounts.
• Confirm the company’s client base, contract terms, and revenue pipeline to evaluate future turnover prospects.
• Assess any potential related party transactions or director loans that may impact financial stability.