ARC PROJECT CONSULTING LIMITED

Executive Summary

ARC PROJECT CONSULTING LIMITED is financially healthy with strong liquidity and growing net assets, reflecting sound management and sustainable growth. The company should maintain its strong cash position and cautiously plan for future growth to avoid financial stress. Continued vigilance and strategic planning will support ongoing financial wellness.

ARC PROJECT CONSULTING LIMITED - Analysis Report

Company Number: 13127510

Analysis Date: 2025-07-19 13:05 UTC

Financial Health Assessment for ARC PROJECT CONSULTING LIMITED

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1. Financial Health Score: B

Explanation:
The company demonstrates strong liquidity and solid net asset growth over the past two years, indicating overall good financial health. However, as a micro-entity with limited fixed assets and modest capital base, there remains some vulnerability to unexpected financial shocks. The B grade reflects a healthy but cautious position typical for a young consulting business.

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2. Key Vital Signs

Metric	2024	2023	Interpretation
Fixed Assets	£3,862	£1,135	Small but growing investment in long-term assets indicates cautious asset acquisition.
Current Assets	£188,811	£113,088	Healthy increase in liquid assets, showing strong "cash flow pulse".
Current Liabilities	£45,806	£29,089	Moderate increase in short-term obligations; manageable given asset growth.
Net Current Assets (Working Capital)	£152,687	£97,065	Excellent working capital buffer; indicates good short-term financial health.
Net Assets (Equity)	£118,017	£72,782	Solid growth in equity; company is building retained earnings, a sign of sustainable operations.
Share Capital	£100	£100	Minimal share capital typical for micro-entities; majority funding comes from retained profits.
Average Employees	2	1	Gradual scaling of workforce aligned with business growth.

Interpretation of Vital Signs:

• The company's liquidity is robust, with ample current assets to cover short-term liabilities by over 4 times, signaling healthy cash flow and working capital management—akin to a patient with a strong heartbeat.
• Growth in net assets reflects retained profits and sustainable reinvestment, showing the business is "building muscle" financially.
• Fixed assets remain a small part of the balance sheet, typical for a consulting firm without heavy capital investment needs.
• The modest increase in current liabilities is not alarming but should be monitored to avoid any "symptoms of distress" such as overdue payables.
• Employment growth demonstrates measured scaling of operations, consistent with business expansion.

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3. Diagnosis

ARC PROJECT CONSULTING LIMITED is currently in a stable and healthy financial condition. The company's balance sheet shows strong liquidity and improving equity, indicating it is effectively managing its finances and successfully growing its retained earnings. The absence of overdue filings or liabilities in liquidation or administration further supports a sound financial status.

No red flags such as excessive debt, declining assets, or liquidity shortages are evident. The company is investing cautiously in fixed assets and expanding its workforce modestly, consistent with a young and growing consulting business.

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4. Recommendations

To maintain and improve financial wellness, the following actions are suggested:

• Maintain Strong Cash Management: Continue to monitor working capital closely to ensure the company can meet short-term obligations without strain. Avoid excessive build-up of current liabilities.

• Plan for Capital Needs: Consider gradually increasing share capital or exploring other funding avenues if strategic investments or expansion require it. Relying solely on retained earnings may limit growth pace.

• Document Strategic Growth: As consulting activities expand, formalise business plans and financial forecasting to anticipate capital needs and manage risks proactively.

• Monitor Overheads: Keep employee and administrative costs aligned with revenue growth to maintain profitability and prevent symptoms of financial distress.

• Review Provisions & Accruals: The provisions for liabilities increased in 2024; ensure these are justified and not indicative of emerging risks or contingent liabilities.

• Regular Financial Reviews: Continue timely filings and internal reviews to maintain compliance and early detection of any financial issues.

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