Company Number: 13185106

Analysis Date: 2025-07-29 13:32 UTC

1. Risk Rating: HIGH
   The company exhibits a significant decline in net current assets and shareholders’ funds over recent years, with net current assets barely positive (£2,050 as of 31 March 2024) and a sharp reduction from £25,435 in the prior year. Current liabilities have doubled compared to 2023, while cash balances have dropped substantially, indicating potential liquidity stress.

2. Key Concerns:

• Liquidity risk: Cash at bank has fallen from £22,503 in 2023 to £11,464 in 2024, while current liabilities have nearly doubled to £124,846, creating tight working capital and potential cash flow constraints.
• Declining net assets and equity: Shareholders’ funds decreased from £25,563 in 2023 to just £2,118 in 2024, a concerning erosion of capital that may impair solvency.
• Creditor concentration and financing: The company has granted a fixed and floating charge to Giant Finance + Limited over its debts, suggesting reliance on debtor financing which may signal cash flow dependence on external arrangements.

3. Positive Indicators:

• No overdue filings: Both accounts and confirmation statement filings are up to date, indicating regulatory compliance.
• Stable management: Directors and secretary have been in place since incorporation without recorded issues; no director disqualifications are noted.
• Revenue recognition policies: The company follows FRS 102 accounting standards and small company regime exemptions correctly, reflecting adherence to applicable financial reporting frameworks.

4. Due Diligence Notes:

• Review debtor aging and collectability: The large debtor balance (£115,432) is critical to liquidity; verify ageing, concentration, and recoverability.
• Examine creditor terms and financing arrangements: Understand the nature of the fixed and floating charge with Giant Finance + Limited, including any covenants or repayment obligations.
• Assess cash flow forecasts and working capital management: Given the liquidity squeeze, detailed cash flow projections and funding plans are essential to evaluate ongoing operational viability.
• Investigate related party loans: Confirm terms, repayment status, and any impact on liquidity or control, especially loans with Kerv Capital Limited and Kevin Edward Leeds Ltd.

Executive Summary:
Westerdale Group Ltd shows signs of financial strain with deteriorating liquidity and a sharp decline in net assets, raising concerns over its ability to meet short-term obligations. While regulatory filings are current and governance appears stable, significant due diligence on debtor quality, creditor arrangements, and cash flow sustainability is warranted before considering investment.