Is this a successful business

textbook

When assessing a limited company's accounts how whst info do you look at to assess that?

How about this company?

marcia_

I would look at the directors of the company and see if they have any other companies they are/were directors of and if they are solvent as some dodgy directors have many failed companies behind them.

Dead_keen

You may want to delete the company number if you want to make it a bit harder to work out the company name.

Accounts for small private companies do not give enough information to say whether it is successful or not. They are also out of date. Any your idea of successful may be quite different to mine. It has lots of cash but does it make a profit each year? May be lots and it's paid out as a dividend. But probably not from the rest of the accounts. Or does it pay big bonuses instead, who knows?

marlot

As said, you cannot deduce much about profitability from the balance sheet. It is just a snapshot in time.

The company may have made £1m in profit and distributed it in salaries/dividends. Or paid it to other companies in the group. Or it might be doing almost no business.

All you can be really sure is that the company had about £650k in net assets at the end of Dec 2024. Lots could have changed since then.

Albermarle

There is a reduction in value of debtors and creditors from 2023. This could indicate a reduction in business activity, but without fuller info it is impossible to be sure.

textbook

https://forums.moneysavingexpert.com/discussion/comment/81949443#Comment_81949443

So If on company's house they have lots of dissolved companies - red flag?

marcia_

https://forums.moneysavingexpert.com/discussion/comment/81966640#Comment_81966640

definitely. Why do they keep setting up and closing businesses. Failure, fraud, incompetence etc

Notepad_Phil

https://forums.moneysavingexpert.com/discussion/comment/81966640#Comment_81966640

Maybe not a definite 100% red flag, but I'd want some compelling reasons for why they'd had such a poor record.

poseidon1

https://forums.moneysavingexpert.com/discussion/comment/81949476#Comment_81949476

I would second the recommendation that the company number be deleted if anonymity of this business was the OP's intent. Right now it is very easily ascertained, I have done so.

Dead_keen

https://forums.moneysavingexpert.com/discussion/comment/81966640#Comment_81966640

In reality, you need to understand the facts before you can say whether it is a red flag or not.

Someone may have been a director of tens of companies a big group five years ago, who sold out for £1 billion and then dissolved each company in the group solvently. Fantastic, it shows they are a great business person who made a lot of money. No red flag there.

Others are where people have set up a company to do the next big idea only to find out that someone else had already done it and so the company stays dormant and then gets dissolved. It costs tuppence-ha'penny to set up a new company, and a lot more to pay the Companies House fee each year. So starting it up and then letting getting it struck off when not needed is a great idea. How you understand the true facts (vs a 16 year old foreign national who can't find the UK on a map, sets up a company to not pay VAT on internet sales and never files a return so it is struck off automatically) is obviously harder.

On the otherhand there are clear red flags with just a single liquidation where, for example, the liquidators' report says that the sole director did not cooperate and HMRC is unlikely to get any of the money it is owed is a red flag bigger than they have on firing ranges on a windy day. Out of interest, I was just looking at one company where HMRC are unlikely to get much of the £81,835,340.60 owed to it back. That's a red flag to me.

textbook

https://forums.moneysavingexpert.com/discussion/comment/81967015#Comment_81967015

DDone- hid number