Company Number: 14722751

Analysis Date: 2025-07-29 13:32 UTC

Financial Health Assessment for CHEEKOTI SOLUTIONS LTD

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1. Financial Health Score: B

Explanation:
Cheekoti Solutions Ltd shows a solid start-up financial profile with positive net assets and a healthy working capital position relative to its scale. The company is in its first financial year, with no audit requirement and limited complexity. The financials reflect a stable foundation but with limited scale and untested operational cash flows, which is typical for a business at this early stage. The grade B indicates a generally healthy financial state with room for growth and monitoring as the business matures.

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2. Key Vital Signs

Metric	Value	Interpretation
Current Assets	£7,913	Entirely cash, indicating liquidity but no receivables or stock yet.
Current Liabilities	£4,640	Short-term obligations mainly taxation and other creditors.
Net Current Assets	£3,273	Positive working capital, implying the company can cover short-term debts comfortably.
Net Assets (Equity)	£3,273	Positive net worth, showing initial funding and some retained earnings.
Share Capital	£1	Minimal share capital, typical for a new small company.
Profit & Loss Reserve	£3,272	Accumulated retained earnings or net profit, a good sign of early profitability or capital injection.
Average Employees	2	Small team, consistent with micro or small company status.
Turnover	Not disclosed	Turnover not provided; limitation in assessing revenue generation.
Liquidity Ratio	Current Assets / Current Liabilities ≈ 1.7	Indicates a comfortable liquidity buffer to meet short-term obligations.

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3. Diagnosis

The financial "vital signs" of Cheekoti Solutions Ltd suggest a healthy cash flow status for a start-up IT consultancy. The company’s cash balance of £7,913 against current liabilities of £4,640 provides a buffer against immediate financial distress, akin to a patient with stable vital signs but still in the early recovery phase.

The positive net assets of £3,273 highlight that the company’s financial structure is sound, with shareholder funds fully intact. The low share capital with a much larger profit & loss reserve suggests initial capital contributions plus possibly early earnings or retained profits, which is promising.

However, the absence of disclosed turnover and profit figures limits full analysis of business operations and profitability trends. The company has no fixed assets, indicating a lean operational model without significant capital expenditure, typical for a consultancy.

Being newly incorporated (less than 1.5 years old) and classified as a small company, it has not yet built a comprehensive financial history or track record. The lack of audit requirement and opt-out from delivering profit and loss accounts is standard for a company of this size but restricts external confidence and detailed insight.

The director holds full control (75-100% ownership and voting rights), which means decision-making is centralized but also places responsibility firmly on management to maintain financial health.

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4. Recommendations

To maintain and improve financial wellness, Cheekoti Solutions Ltd should consider the following actions:

• Build Revenue Transparency: Begin disclosing turnover and profit figures in future filings. Consistent revenue growth and profitability are key to strengthening financial health and attracting investment or credit.

• Monitor Cash Flow Vigilantly: Maintain healthy cash reserves and closely manage payables and receivables to avoid liquidity crunches. A healthy cash flow is akin to stable circulation in the body, essential for all operations.

• Plan for Scale: As the business grows, consider investing in fixed assets or technology to support service delivery, but balance this with maintaining liquidity.

• Strengthen Financial Reporting: Even though audit exemption applies, voluntary audits or reviews could enhance credibility with lenders and clients.

• Diversify Funding Sources: Explore options beyond founder capital, such as loans or equity investment, to support expansion and reduce financial risk.

• Governance and Controls: Implement robust internal controls and seek advice on tax planning to optimize financial performance and compliance.

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