Company Number: 14970549

Analysis Date: 2025-07-29 13:06 UTC

1. Credit Opinion: CONDITIONAL APPROVAL

WPS Paraplanning Ltd is a newly incorporated private limited company (June 2023) operating in financial management (SIC 70221). The company shows modest net assets (£15,080) and positive working capital (£13,995) after its first full accounting period, indicating a stable initial financial position. However, the scale of operations is very small, with only one employee (the director) and limited fixed assets (£1,339 net book value). The absence of an income statement and profitability details restricts full assessment of earnings capacity. The director, Mr. Sol Paul Williamson, holds full control and has financial expertise, which supports sound governance. Given the limited financial history, credit approval should be conditional on monitoring future trading performance and cash flow generation.

2. Financial Strength:

• The balance sheet is healthy for a start-up, with net assets of £15,080, primarily composed of net current assets.
• Current assets (£24,509) comfortably cover current liabilities (£10,514), resulting in a current ratio of approximately 2.3x, which signals good short-term liquidity.
• Tangible fixed assets are minimal (£1,339), reflecting low capital expenditure.
• Shareholders’ funds equal net assets, reflecting no external debt or long-term liabilities.
• The company paid dividends (£21,000) to the director during the period, which is notable given the limited retained earnings; this suggests careful review of cash reserves and dividend policy is warranted.

3. Cash Flow Assessment:

• Cash at bank stands at £10,959, which is adequate for immediate obligations.
• Trade debtors (£13,550) indicate ongoing business activity, but the quality and ageing of these receivables are unknown.
• Creditors include a significant tax liability (£8,475), which appears manageable given available cash.
• Net current assets of £13,995 show positive working capital, but the company’s ability to generate sustainable operating cash flow remains to be demonstrated.
• With only one employee and low overheads, cash burn rate is likely low, but ongoing liquidity should be closely monitored.

4. Monitoring Points:

• Future profitability and turnover growth to validate business viability.
• Aging and collectability of trade debtors to assess cash conversion effectiveness.
• Management of tax liabilities and dividend distributions relative to earnings and cash reserves.
• Maintenance of adequate working capital as business scales.
• Director’s continued involvement and potential changes in ownership or governance.
• Compliance with future filing deadlines and any changes in company status.