Company Number: 12835254

Analysis Date: 2025-07-19 12:14 UTC

Financial Health Assessment for Cameron Rae Consultancy Limited

---

1. Financial Health Score: B

Explanation:
Cameron Rae Consultancy Limited demonstrates a stable financial position typical of a micro-entity with modest assets and liabilities. The company shows positive net current assets and shareholders' funds, indicating a generally healthy balance sheet. However, the sharp fluctuations in net assets and current assets over recent years, along with relatively low absolute asset values, suggest caution. The company is not showing signs of distress but has limited financial buffer and growth momentum, warranting a "B" grade reflecting solid but cautious financial health.

---

2. Key Vital Signs

Metric	2024 Value (£)	Interpretation
Current Assets	9,761	Slight increase from previous year, indicates some liquidity.
Current Liabilities	7,557	Moderate short-term obligations, manageable with current assets.
Net Current Assets	2,204	Positive working capital, a sign of short-term financial health ("healthy cash flow").
Shareholders' Funds	2,204	Equity coverage matches net current assets; relatively low but positive.
Share Capital	1.00	Minimal share capital, typical for small startups or consultancies.
Average Employees	1	Small operation, low overheads but limited manpower for growth.
Trend in Net Assets	Fluctuating	Declined from £6,067 in 2021 to £2,204 in 2024; signals volatility in retained earnings or reserves.

---

3. Diagnosis

• Liquidity and Working Capital: The company maintains positive net current assets, meaning it can cover its short-term liabilities with available current assets. This is akin to having a healthy pulse rate, indicating the company can meet immediate obligations without strain.

• Equity Position: Shareholders' funds of £2,204 suggest the business is modestly capitalised. The low and fluctuating equity base over recent years indicates limited retained profits or capital injections, possibly reflecting inconsistent profitability or distributions.

• Asset Base: The company holds mainly current assets, with no fixed assets reported in 2024. This aligns with its consultancy business model, which is less capital intensive but may also limit tangible asset collateral for financing.

• Operational Scale: With only one employee (the director) and minimal share capital, the company operates on a lean model. While this reduces fixed costs, it may restrict capacity for growth and scalability.

• Financial Volatility: The net assets have shown a downward trend since 2021, indicating the company might be experiencing "symptoms of financial stress" such as thin margins or inconsistent cash flow in some years. However, the positive working capital suggests no immediate liquidity crisis.

• Director's Advances: The director's account swings between owing the company and the company owing the director. This shows some informal financing but no alarming levels of director loans or debts.

---

4. Recommendations to Improve Financial Wellness

• Strengthen Capital Base: Consider increasing share capital or retaining more profits to build equity buffers. This would be analogous to strengthening the immune system, helping the company withstand financial shocks.

• Enhance Profitability and Cash Flow: Focus on improving margins, managing expenses, and accelerating cash collections to boost working capital and net assets.

• Financial Planning and Budgeting: Implement regular cash flow forecasting and budgeting to detect early "symptoms" of liquidity stress and plan accordingly.

• Formalise Director Loans: Clarify and document director advances or repayments to avoid confusion and maintain transparent accounts.

• Growth Strategy: To move beyond micro-entity status and improve financial resilience, explore opportunities to scale operations, possibly by hiring additional staff or investing in marketing to increase revenues.

• Risk Management: Monitor industry trends in media and marketing sectors where the company operates to anticipate external risks that could impact financial health.

---