BARA SECURITY MANAGEMENT LTD

Executive Summary

BARA SECURITY MANAGEMENT LTD is a young, micro-sized security services company with a modest but positive financial position characterized by limited equity and reliance on director funding. Its current liquidity is sufficient but tight, suggesting cautious optimism with a need to strengthen cash flow and capital structure to ensure sustainable growth. Early-stage financial vigilance and strategic funding are essential for long-term wellness.

BARA SECURITY MANAGEMENT LTD - Analysis Report

Company Number: 14959227

Analysis Date: 2025-07-29 13:56 UTC

Financial Health Assessment Report for BARA SECURITY MANAGEMENT LTD

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1. Financial Health Score: C

Explanation:
Given that BARA SECURITY MANAGEMENT LTD is a newly incorporated company (June 2023) showing positive but very modest net assets and working capital, the financial health is cautiously stable but early-stage. The company shows a "pulse" of operational activity with current assets exceeding current liabilities, but it is reliant on director advances and bank borrowing, indicating limited independent liquidity. For a start-up in security services, this is typical, but it suggests vulnerability to cash flow shocks.

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2. Key Vital Signs

Metric	Value (as of 30 June 2024)	Interpretation
Current Assets	£16,117	Represents short-term resources readily convertible to cash — mainly debtors. Healthy to have assets, but modest size.
Current Liabilities	£14,089	Short-term debts including bank loans. A bit high relative to assets, indicating some liquidity pressure.
Net Current Assets (Working Capital)	£2,028	Positive but narrow margin; "healthy cash flow" would ideally show a larger buffer to cover liabilities.
Net Assets / Shareholders’ Funds	£2,028	Small equity base reflecting early-stage company with limited retained earnings; signs of initial capitalisation.
Called-up Share Capital	£100	Minimal share capital; owner funding is low.
Director Loan Advances	£22,512 (unsecured, interest-free)	Significant reliance on director funding to support operations — a "symptom of financial dependency."
Number of Employees	1 (Director)	Small operation, typical for early start-ups or micro-businesses.
Turnover and Profitability	Not disclosed	No direct data on turnover or profitability yet; unable to assess operational income strength.

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3. Diagnosis: Financial Condition Assessment

BARA SECURITY MANAGEMENT LTD resembles a start-up or micro-business showing initial signs of financial life but with vulnerabilities:

• Liquidity: The company has a positive working capital, meaning it can meet short-term obligations, but the narrow margin indicates a fragile liquidity position. The "symptom of distress" would be any delay in receivables or unexpected expenses that could cause cash flow issues.
• Capital Structure: The nominal share capital and modest net assets suggest limited external equity investment. The company is relying heavily on director advances (£22,512), which is typical for early-stage companies but not a sustainable long-term funding source. This is akin to a patient surviving on temporary IV fluids rather than stable nutrition.
• Operational Scale: With only one employee (the director) and no disclosed turnover figures, the company is in its infancy, focusing likely on establishing contracts or proof of concept rather than full commercial operations.
• Risk Exposure: The bank loan overdraft of £14,090 is a considerable liability relative to company size. This debt servicing obligation could strain resources if revenues do not ramp up swiftly.
• Compliance and Transparency: The company is compliant with filing deadlines and maintains clear record-keeping, which is a positive sign of governance and regulatory health.

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4. Recommendations to Improve Financial Wellness

1. Strengthen Liquidity:

   • Accelerate debtor collections to improve cash flow.
   • Negotiate longer payment terms with creditors to ease immediate cash pressure.
   • Minimise unnecessary expenditure to conserve working capital.

2. Increase Equity Base:

   • Consider additional capital injection from shareholders to reduce reliance on director loans and bank overdrafts.
   • Explore small business grants or start-up funding schemes available in the security sector.

3. Revenue Growth and Profitability:

   • Focus on securing contracts and generating turnover to transition from reliance on director advances.
   • Track and report turnover and profitability to diagnose operational viability.

4. Debt Management:

   • Engage with the bank to restructure overdraft facilities, if needed, to more favourable terms.
   • Avoid increasing short-term borrowings without clear repayment plans.

5. Operational Expansion:

   • Plan for gradual recruitment or outsourcing to scale capabilities as revenues grow, but avoid premature fixed costs.

6. Financial Monitoring:

   • Implement regular cash flow forecasting and financial reviews as the company grows to detect issues early.

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Medical Analogy Summary

BARA SECURITY MANAGEMENT LTD is like a newborn patient with a stable but fragile heartbeat. Its current assets provide a pulse that sustains operations, but the narrow working capital margin and dependency on director loans reveal symptoms of financial stress that need immediate attention to avoid complications. With proper nourishment through equity and revenue growth, the company can build resilience and thrive.

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