APAX ENGINEERING CONSULTANCY LIMITED

Executive Summary

APAX Engineering Consultancy Limited exhibits a stable and healthy financial position for its micro-entity size and early stage, with positive net assets and working capital indicating good liquidity and operational control. The company benefits from director support and prudent financial management but should focus on building reserves and preparing for future growth challenges. Overall, the financial outlook is cautiously optimistic, provided the company maintains disciplined cash flow and risk management practices.

APAX ENGINEERING CONSULTANCY LIMITED - Analysis Report

Company Number: 14694941

Analysis Date: 2025-07-20 13:01 UTC

Financial Health Assessment for APAX ENGINEERING CONSULTANCY LIMITED

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1. Financial Health Score: B

Explanation:
For a newly incorporated micro-entity (incorporated in 2023), APAX Engineering Consultancy Limited demonstrates a solid start with positive net assets and working capital. The financial position shows no immediate distress signs, stable equity, and controlled liabilities. However, limited historical data and modest asset base indicate room for growth and caution in future cash flows. Hence, a grade B indicates generally healthy financial condition with some caution due to scale and infancy.

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2. Key Vital Signs:

Metric	Value (£)	Interpretation
Fixed Assets	18,285	Modest investment in long-term assets, suitable for a micro-entity consultancy.
Current Assets	23,709	Short-term resources available for operations; healthy for liquidity.
Current Liabilities	19,356	Short-term debts; manageable given current assets.
Net Current Assets (Working Capital)	4,353	Positive working capital indicates ability to cover short-term obligations.
Accruals and Deferred Income	1,865	Obligations or income recognition timing adjustments; moderate level.
Net Assets (Shareholders’ Funds)	20,773	Positive equity indicates the company’s residual interest after liabilities.
Employee Count	1	Reflects a lean operation, typical for micro-entities.
Director Advances	-3,120	Director has provided credit to the company, a positive sign of support.

Interpretation of Vital Signs:
The company exhibits a “healthy cash flow” posture with positive net current assets, meaning it can meet short-term debts without strain. The equity base, while small, is positive, showing no “symptoms of distress” such as negative net assets or over-reliance on short-term borrowing. The director’s credit support further reinforces liquidity. However, the overall scale is modest, consistent with its micro company status and recent incorporation.

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3. Diagnosis:

APAX Engineering Consultancy Limited is in a stable financial condition for a micro-sized start-up consultancy in the construction sector (SIC 42910 - construction of water projects). The company’s balance sheet shows no alarming "symptoms of distress" such as excessive liabilities or negative working capital. The positive net assets and working capital suggest the business is managing its finances prudently. The director’s advance (a small credit) indicates internal support and confidence in the company’s operations.

Given the company was incorporated less than two years ago, it is in the early "growth and establishment" phase. The lack of an audit due to micro-entity exemption is typical and does not raise concerns but means detailed financial scrutiny is limited to filed accounts. There is no evidence of financial strain or liquidity issues at this stage.

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4. Recommendations:

• Maintain Positive Working Capital: Continue monitoring cash flow closely to sustain liquidity. As the company grows, ensure current assets keep pace with liabilities to avoid cash flow "symptoms of distress."

• Build Reserves: Aim to retain earnings to strengthen the P&L reserve and shareholders’ funds, which will provide a buffer during business fluctuations.

• Expand Asset Base Cautiously: Invest in fixed assets only as necessary to support growth, balancing between operational needs and cash preservation.

• Director Advances Management: Formalise any director advances or credits with clear terms to avoid confusion and ensure transparent financial records.

• Prepare for Growth: As the company moves beyond micro-entity thresholds, prepare for increased regulatory and audit requirements by enhancing accounting systems and internal controls.

• Risk Management: Identify potential sector-specific risks (e.g., project delays in water construction) and develop contingency plans to prevent financial shocks.

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