Company Number: 13749838

Analysis Date: 2025-07-29 12:56 UTC

1. Risk Rating: MEDIUM
   The company has shown a notable turnaround from negative net assets in 2023 to positive net assets in 2024. However, the absolute values are very small, and cash holdings remain minimal, indicating potential liquidity constraints. The company is very young (incorporated late 2021) and operates in a sector (temporary employment agency activities) that can be inherently volatile. No overdue filings reduce regulatory risk.

2. Key Concerns:

• Liquidity: Cash balance is only £385 at year-end 2024, which is low relative to current liabilities (£3,235). Although net current assets are positive (£2,203), the low cash suggests tight operational liquidity.
• Volatility in Financial Position: The company moved from net liabilities of £5,591 in 2023 to net assets of £2,203 in 2024, indicating either a significant capital injection or revaluation of balances, which warrants further investigation.
• Reliance on Director's Loan: The notes indicate a director's loan account balance fluctuating (6,920 receivable in 2024, 6,307 payable in 2023), suggesting the director is providing financing. Dependence on this could pose risks if the director withdraws support.

3. Positive Indicators:

• Regulatory Compliance: All statutory filings (accounts and confirmation statements) are up to date with no overdue issues.
• Improved Net Assets: Turnaround from negative equity to positive equity within one year shows management action to stabilize financials.
• Small Company Regime: The company is filing under the small companies regime, which reduces administrative burden and costs, appropriate for its scale.

4. Due Diligence Notes:

• Clarify the nature and terms of the director’s loan account, including any repayment schedules or contingencies.
• Investigate what drove the substantial improvement in net assets from 2023 to 2024—to confirm it is sustainable and not due to one-off transactions or accounting adjustments.
• Review operational cash flow statements (not provided here) to assess ongoing liquidity and working capital management.
• Assess client concentration and contract stability given the industry’s susceptibility to fluctuating demand.
• Confirm there are no contingent liabilities or off-balance sheet obligations that could impact solvency.