BEST VALUE CONSULTING ASSOCIATES LTD

Executive Summary

Best Value Consulting Associates Ltd is a newly established micro-entity showing early financial distress with negative working capital and net liabilities. The company faces liquidity challenges and undercapitalization but has potential for recovery with increased capital injection and stronger cash flow management. Immediate focus on stabilizing finances and controlling expenses will improve its financial outlook.

BEST VALUE CONSULTING ASSOCIATES LTD - Analysis Report

Company Number: 15219395

Analysis Date: 2025-07-29 14:34 UTC

Financial Health Assessment for Best Value Consulting Associates Ltd (As of 31 March 2025)

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1. Financial Health Score: D

Explanation:
The company shows significant financial distress signs, including negative net current assets and net liabilities. Although it is a micro-entity in its early stage (incorporated in October 2023), the current financial position is weak, indicating liquidity challenges and a capital deficit. This score reflects considerable risk but also acknowledges the company’s infancy and potential for turnaround.

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2. Key Vital Signs

Metric	Value (£)	Interpretation
Current Assets	388	Very low liquid assets available
Current Liabilities	2,940	Short-term debts exceed assets significantly
Net Current Assets	-2,552	Negative working capital ("symptom of distress")
Net Assets / Shareholders Funds	-3,077	Company is insolvent on a balance sheet basis
Average Number of Employees	1	Small operational scale
Audit Status	Exempt (micro-entity)	Limited external scrutiny, reliance on internal controls

• Negative Net Current Assets: The company’s current liabilities are over seven times its current assets, indicating a critical shortage of liquidity to meet immediate obligations. This is akin to a patient having dangerously low blood pressure—urgent attention is needed.
• Negative Net Assets: The company’s total liabilities exceed its assets by £3,077, showing a capital deficit and insolvency on paper. This is a chronic condition that must be addressed to avoid worsening financial health.
• Micro-Entity Status: As a newly formed micro-entity, the company benefits from simplified filing and audit exemptions, but this also means less external validation of financial robustness.
• Single Employee/Director: The business is run by one individual who also holds full ownership and control, which concentrates decision-making but also risk.

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3. Diagnosis

Underlying Business Health:
Best Value Consulting Associates Ltd appears to be in the startup phase, with limited operational scale and financial resources. The negative net current assets and shareholders funds are symptoms of early-stage cash flow problems and undercapitalization. The company is currently "ill" financially, primarily due to a mismatch between short-term obligations and liquid assets. This may reflect initial setup costs, delayed revenue inflows, or early-stage investment requirements.

Risk Factors:

• The company’s inability to cover short-term liabilities with current assets suggests potential liquidity crises.
• Negative equity signals that external funding or owner capital injections may be necessary to restore balance sheet health.
• As the sole director and majority shareholder, the company is vulnerable to key person risk.
• Lack of audit reduces external assurance but is typical at this stage.

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4. Recommendations

Immediate Actions:

• Boost Liquidity: Inject additional capital or secure short-term financing to cover current liabilities and create a buffer for ongoing expenses. This is equivalent to stabilizing a patient’s vital signs in an emergency.
• Cash Flow Management: Implement strict cash flow forecasting and management to ensure timely payments and receipts. Prioritize revenue-generating activities and manage payables carefully.
• Review Expenses: Evaluate all operating costs for possible reductions or deferrals to conserve cash.

Medium-Term Strategies:

• Seek External Funding: Consider loans, investor funding, or grants to improve net assets and working capital.
• Business Development: Accelerate client acquisition and project delivery to increase turnover and improve financial inflows.
• Governance and Controls: Although audit-exempt, establish robust internal financial controls to monitor health continuously and prepare for future growth.

Long-Term Outlook:

• As a micro-entity in consultancy, growth is possible if cash flow and capital structure improve.
• Avoiding sustained losses and managing liabilities prudently will be critical to recovery.
• Regular financial reviews and scenario planning are advised to detect early symptoms of distress and act promptly.

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