Company Number: 12510513

Analysis Date: 2025-07-29 17:44 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   DEBITSCREDITS.CO.UK LIMITED shows stable financial metrics for a micro-entity over recent years with consistent positive net current assets and a small but growing equity base. The company operates in the accounting and auditing sector with a very modest asset base and limited share capital. The small scale and modest net asset position suggest limited financial buffer, hence credit approval should be conditional on maintaining current working capital levels and regular review of liquidity. No adverse director conduct records or overdue statutory filings are noted, supporting governance confidence.

2. Financial Strength:
   The balance sheet reflects a micro-sized entity with total net assets increasing from £626 in 2023 to £1,098 in 2024, indicating gradual equity growth. Fixed assets have declined slightly from £10,240 to £8,192, while current assets decreased marginally from £38,221 to £34,750. Current liabilities reduced from £29,228 to £26,274, improving net current assets to £8,476. However, long-term liabilities remain significant at £15,570, reducing total net assets. The company’s financial leverage is moderate given the scale, but the equity base is very thin, limiting financial resilience.

3. Cash Flow Assessment:
   Working capital remains positive and stable around £8,000+, which is a good sign of liquidity for short-term obligations. The current ratio is approximately 1.32 (Current Assets £34,750 / Current Liabilities £26,274), indicating adequate liquidity coverage. Average employee count is low at 3, which suggests limited payroll burden. The absence of large fluctuations in current assets or liabilities suggests no immediate liquidity stress, but the relatively small cash reserves and low equity imply limited capacity to absorb unexpected cash flow shocks.

4. Monitoring Points:

• Track net current assets and liquidity ratios each reporting period to ensure ongoing ability to service short-term liabilities.
• Monitor the level of long-term liabilities relative to equity for signs of increasing financial leverage risk.
• Review profitability and cash flow statements when available to assess operational cash generation trends.
• Keep oversight on director activities and compliance filings to detect any governance or regulatory concerns early.
• Watch for changes in client base or market conditions impacting the accounting services sector that could affect revenue stability.