ALLEN FINTECH LIMITED

Executive Summary

ALLEN FINTECH LIMITED has experienced a sharp financial decline resulting in negative net assets and working capital, indicating a liquidity crisis and potential solvency issues. Immediate steps to manage cash flow, reduce costs, and inject capital are critical to reversing this downward trend and restoring financial health.

ALLEN FINTECH LIMITED - Analysis Report

Company Number: 13508560

Analysis Date: 2025-07-20 18:18 UTC

Financial Health Assessment for ALLEN FINTECH LIMITED

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1. Financial Health Score: D

Explanation:
The company’s financial health score is graded D, reflecting a concerning downturn in its financial position over the most recent year. Key indicators reveal symptoms of financial distress, including a sharp deterioration in liquidity and net assets, which require urgent attention to restore stability.

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2. Key Vital Signs

Vital Sign	2024 Value	Interpretation
Net Assets (Shareholders’ Funds)	£-11,591	Negative net assets indicate insolvency symptoms; liabilities exceed assets—unhealthy condition.
Net Current Assets (Working Capital)	£-11,763	Negative working capital suggests liquidity crunch; risk of struggling to meet short-term debts.
Current Assets	£342	Extremely low liquid assets (cash, receivables) compared to prior year’s £21,221—sign of cash flow issues.
Current Liabilities	£12,105	Sharp increase compared to £4,451 prior year; rising short-term debts increase financial strain.
Fixed Assets	£171	Minimal fixed asset base, consistent with micro company status; no buffer of tangible assets.
Employee Count	1	Very small operation, low overhead but limited resource capacity.

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3. Diagnosis

The financial "vital signs" reveal significant symptoms of distress:

• Liquidity Crisis: The company has gone from a healthy net current asset position (£16,770 in 2023) to a severe liquidity deficit (£-11,763 in 2024). This suggests cash inflows have sharply declined or short-term obligations have surged, impairing the company’s ability to fund day-to-day operations.

• Balance Sheet Insolvency: Negative net assets of £-11,591 indicate that the company’s total liabilities exceed its assets, a classic symptom of financial distress that threatens solvency and continuity if unresolved.

• Rapid Deterioration: The abrupt drop from positive net assets and working capital to negative in a single year hints at a major adverse event—such as revenue collapse, unexpected costs, or uncollected receivables—impacting the business.

• Micro Entity Status & Small Scale: Being a micro entity with only one employee and minimal fixed assets limits the company’s resilience and ability to absorb shocks or invest in growth.

• Ownership and Control: With Mr Craig Steven Allen owning 75-100% and serving as sole director, decision-making is concentrated, which can be an advantage for swift action but also a risk if diversification of input is limited.

Overall, the company’s financial health resembles a patient exhibiting acute symptoms of distress requiring immediate intervention to avoid serious complications such as insolvency or forced liquidation.

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4. Recommendations

To stabilize and improve financial wellness, consider the following actions:

1. Urgent Cash Flow Management:

   • Conduct a detailed cash flow forecast to identify gaps.
   • Prioritize collection of receivables and negotiate extended payment terms with creditors.
   • Consider bridging finance or short-term credit facilities to cover immediate liabilities.

2. Cost Control and Operational Efficiency:

   • Review all operational expenses to cut non-essential costs.
   • Assess if the business model or service offerings need adjustment to improve revenue inflow.

3. Capital Injection:

   • Explore options for equity infusion from existing shareholder or external investors to shore up net assets.
   • Alternatively, consider shareholder loans or convertible notes as temporary relief.

4. Strategic Business Review:

   • Analyze causes behind the sharp financial decline (e.g., market changes, client loss) and develop a turnaround plan.
   • Seek external professional advice from financial consultants or turnaround specialists.

5. Ongoing Financial Monitoring:

   • Implement regular financial health checks (monthly/quarterly) to detect early warning signs promptly.
   • Maintain updated management accounts and forecasts.

6. Governance and Risk Management:

   • Despite single-director structure, consider advisory support or non-executive input to challenge decisions and improve governance.

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Medical Analogy Summary

The company’s financial condition is like a patient who was stable but has recently developed severe symptoms—such as a dangerously low pulse (cash flow) and negative blood pressure (net assets). Without prompt treatment (cash flow rescue, cost control, capital support), the patient risks collapse (insolvency). Close monitoring and a structured recovery plan are essential to regain financial vitality.

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