Company Number: 14194936

Analysis Date: 2025-07-20 17:39 UTC

1. Risk Rating: MEDIUM
   The company has shown improvement from negative net assets to positive net assets in the latest financial year. However, the current liabilities exceed current assets, indicating short-term liquidity pressure. The reliance on a director’s loan account as a significant creditor also presents a risk if external financing or operational cash flow is insufficient.

2. Key Concerns:

• Negative net current assets of £4,801 as of 2024-06-30 suggest working capital constraints and possible liquidity challenges to meet short-term obligations.
• Director’s loan account of £20,843 is the largest component of current liabilities, indicating dependence on insider funding rather than external financing or operational cash flow. This could affect financial stability if the director withdraws support.
• The company is relatively new (incorporated June 2022) with limited operating history and only one employee, which raises questions about operational scale and sustainability in the management of real estate and construction sectors.

3. Positive Indicators:

• The company transitioned from negative shareholders’ funds (£-150) in 2023 to positive net assets (£9,808) in 2024, reflecting some capital injection or retained earnings improvement.
• Cash position increased significantly from £100 in 2023 to £18,681 in 2024, which improves liquidity buffer despite overall working capital deficit.
• No overdue filings for accounts or confirmation statements, indicating compliance with statutory obligations and governance standards.
• Tangible fixed assets of £14,609 suggest investment in operational capacity, relevant to its SIC codes in real estate management and building project development.

4. Due Diligence Notes:

• Investigate the nature, terms, and sustainability of the director’s loan account, including repayment terms and potential risk if the director withdraws funds.
• Assess revenue streams, contracts, and cash flow forecasts to evaluate the company’s ability to generate operational cash inflows sufficient to cover liabilities.
• Review any contingent liabilities or off-balance sheet exposures given the company’s activities in construction and real estate development.
• Confirm the accuracy of debtor balances and absence of overdue trade receivables, as reported debtors are nil or minimal.
• Evaluate management’s strategy for improving working capital and whether external financing or equity injections are planned.