Company Number: 13108324

Analysis Date: 2025-07-20 14:40 UTC

Financial Health Assessment of CMN PAYROLL LTD

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1. Financial Health Score: B

Explanation:
CMN PAYROLL LTD exhibits stable and positive financial indicators typical of a healthy micro-entity. The company maintains solid net current assets and net assets over the past four years, indicating financial stability. However, a slight decline in current assets and net assets in the latest year suggests cautious monitoring is needed. The absence of debt beyond current liabilities and positive shareholders’ funds support a good financial standing, though the scale of operations is small and growth appears moderate.

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2. Key Vital Signs

Metric	2024 (£)	2023 (£)	Interpretation
Fixed Assets	379	379	Minimal long-term assets, typical for a service-focused business. No change, stable.
Current Assets	39,025	48,277	Healthy liquid assets, but decreased by ~19% indicating possible lower receivables or cash.
Current Liabilities	12,281	18,152	Reduction in short-term debts, a positive sign of managing payables or other obligations.
Net Current Assets	26,744	30,125	Strong working capital position, sufficient to cover current liabilities comfortably.
Total Net Assets (Shareholders’ Funds)	27,123	30,504	Positive equity reflects retained earnings and financial strength, slight decline year-on-year.
Average Employees	2	1	Growth in workforce suggests business expansion or increased workload capacity.

Interpretation of Vital Signs:

• Healthy cash flow symptoms: Strong net current assets show the company can meet short-term obligations without stress.
• Stable asset base: Fixed assets remain nominal and unchanged, fitting a bookkeeping services firm.
• Minor symptoms of distress: The decline in current assets and net assets may reflect reduced incoming payments or increased expenses, warranting attention.
• Growth indicator: Increase in employee numbers suggests business activity is scaling, which could lead to higher revenues in the future.

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3. Diagnosis: Overall Financial Condition

CMN PAYROLL LTD is financially sound with a solid equity base and a comfortable liquidity position. The company’s micro-entity status and bookkeeping activities imply a low asset intensity business with limited capital expenditure needs. The consistent net current assets and shareholders’ funds indicate it is operating within its means without excessive reliance on external finance. The slight downward trend in current assets and equity may indicate either investment in growth or temporary reduction in receivables.

The company’s director, Mrs Raisa Akbar, holds full control and decision-making authority, providing clear leadership but also concentration risk.

There are no signs of financial distress such as negative working capital, high debt, or deteriorating equity. The company’s timely filing of accounts and returns further supports operational discipline and compliance.

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4. Recommendations for Financial Wellness Improvement

• Cash Flow Monitoring: Implement tighter cash flow forecasting to anticipate any dips in current assets and avoid liquidity crunches.
• Receivables Management: Review debtor collection periods to improve cash inflows and prevent buildup of overdue payments.
• Cost Control: Analyze operating expenses, especially with the increase in employees, to ensure profitability is maintained or improved.
• Growth Strategy: Consider formalizing growth plans to leverage increased staffing for revenue expansion while maintaining financial controls.
• Risk Diversification: Explore ways to diversify control or introduce advisory support to mitigate concentration risk from sole shareholder/director control.
• Regular Financial Reviews: Schedule periodic financial health checks, akin to routine medical check-ups, to catch early symptoms of financial stress and act promptly.

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