Company Number: 14806062

Analysis Date: 2025-07-20 13:41 UTC

1. Risk Rating: HIGH
   The company exhibits significant solvency and liquidity concerns as evidenced by negative net current assets and net liabilities within its first financial year. The company’s inability to cover short-term obligations raises substantial risk for creditors and investors.

2. Key Concerns:

• Negative Net Current Assets & Net Liabilities: The company’s current liabilities (£6,335) exceed its current assets (£3,308), resulting in net current liabilities of £3,027 and overall net liabilities of the same amount, indicating financial distress.
• Negative Cash Balance: The reported cash balance is negative (£-592), which signals immediate liquidity issues potentially impairing the company’s ability to meet day-to-day obligations.
• Director Resignation: The sole director resigned shortly before the accounts were approved, which may imply governance instability or management challenges, especially given the company’s financial position.

3. Positive Indicators:

• Current Filing Status: The company is up to date with statutory filings and accounts, with no overdue filings, showing compliance discipline.
• Small Company Reporting Regime: The accounts are prepared under a simplified small companies regime, consistent with the company’s size and early stage.
• Active Operations: The company has a small employee base (3 employees) and trade debtors (£3,900), indicating some operational activity and revenue generation.

4. Due Diligence Notes:

• Investigate the nature and collectability of trade debtors (£3,900) to assess cash conversion prospects.
• Clarify the circumstances around the director’s resignation and current governance arrangements.
• Review any loan agreements with directors (£2,369 creditor balance) for repayment terms and risk exposure.
• Assess the company’s business plan and cash flow forecasts to understand how it intends to resolve its negative working capital and net liabilities.
• Confirm the adequacy of financial controls and management capacity given the company’s early-stage status and financial challenges.