ACMH CONSULTING LIMITED

Executive Summary

ACMH CONSULTING LIMITED, as a newly incorporated micro-entity, currently faces negative equity and working capital deficits, indicating early signs of financial distress typical for start-ups in their initial phase. Immediate focus on improving cash flow, controlling costs, and securing additional liquidity is essential to stabilize and strengthen the company's financial health going forward.

ACMH CONSULTING LIMITED - Analysis Report

Company Number: 14617224

Analysis Date: 2025-07-29 19:13 UTC

Financial Health Assessment: ACMH CONSULTING LIMITED

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1. Financial Health Score: D

Explanation:
The company’s financial statements indicate a net current liability position and negative net assets for the year ending 31 January 2024. This suggests an early symptom of financial distress, despite being a newly incorporated micro-entity. The absence of fixed assets and minimal current assets, combined with current liabilities exceeding current assets, indicates a fragile financial state requiring close monitoring.

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2. Key Vital Signs

Metric	Value (£)	Interpretation
Fixed Assets	0	No long-term assets owned; typical for a service-based start-up but limits collateral options.
Current Assets (including cash)	6,025	Limited liquid resources; could be tight for operational cash flow needs.
Current Liabilities	8,138	Short-term debts exceed current assets, creating working capital deficiency (liabilities > assets).
Net Current Assets (Working Capital)	-2,113	Negative working capital indicates potential cash flow problems.
Net Assets (Shareholders’ Funds)	-2,113	Negative equity suggests the company owes more than it owns, a concerning financial symptom.
Number of Employees	1	Small workforce consistent with micro-entity status; manageable payroll burden.

Interpretation:

• The "negative net assets" is akin to a "low red blood cell count" in a patient—signaling that the company’s financial body lacks sufficient strength to sustain growth without intervention.
• Negative working capital ("symptom of distress") implies the company might struggle to meet its short-term obligations as they fall due.
• Lack of fixed assets means no tangible buffer or collateral for financing, increasing reliance on external funding or owner capital.

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3. Diagnosis

ACMH CONSULTING LIMITED is in the very early stages of its financial lifecycle, with just over one year since incorporation. The financial position reveals:

• Fragile liquidity: The company has more short-term liabilities than current assets, which is a warning sign for cash flow challenges.
• Negative equity: Shareholders’ funds are negative, indicating accumulated losses or initial funding deficits, which is unusual but not uncommon for start-ups in their first year.
• No fixed assets: The company seems to operate without significant capital expenditure, typical for consultancy businesses, but this limits asset-backed borrowing options.
• Micro-entity scale: With only one employee and micro-accounting status, the company is small-scale with limited operational complexity.

Overall, the company is showing early symptoms of financial strain that, if unmanaged, could lead to insolvency risks. However, as a new start-up, this may reflect initial investment and setup phases before revenue generation stabilizes.

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4. Recommendations

To improve financial wellness and avoid worsening symptoms:

• Improve cash flow management: Focus on accelerating receivables collection and negotiating extended payment terms with creditors to alleviate working capital pressure.
• Increase liquidity reserves: Consider additional equity injections or short-term financing to build a cash buffer, akin to providing a patient with essential nutrients to restore strength.
• Cost control: Monitor and limit expenses carefully, especially discretionary costs, to preserve cash.
• Revenue generation: Prioritize business development to increase sales and improve cash inflows.
• Financial monitoring: Establish regular cash flow forecasting and financial health checks to detect early warning signs.
• Seek professional advice: Engage with financial advisors or accountants experienced in start-up dynamics to develop a robust financial plan.

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