CONSTRUCTION AND ENGINEERING DISPUTE RESOLUTION SERVICES (2020 VISION) LTD

Executive Summary

CONSTRUCTION AND ENGINEERING DISPUTE RESOLUTION SERVICES (2020 VISION) LTD currently shows signs of financial distress characterized by negative working capital and declining net assets. Immediate action to improve cash flow and address the negative equity is essential to avoid further deterioration. With appropriate interventions, the company's financial health can be stabilized and improved.

CONSTRUCTION AND ENGINEERING DISPUTE RESOLUTION SERVICES (2020 VISION) LTD - Analysis Report

Company Number: 13549364

Analysis Date: 2025-07-20 16:39 UTC

Financial Health Assessment Report
Company: CONSTRUCTION AND ENGINEERING DISPUTE RESOLUTION SERVICES (2020 VISION) LTD
Assessment Date: Based on accounts up to 31 August 2024

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1. Financial Health Score: D

Explanation:
The financial metrics indicate the company is currently under financial distress with net liabilities exceeding current assets. The consistent deterioration in net assets over the past two years and negative working capital are symptoms of imbalance between short-term obligations and available liquid resources.

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2. Key Vital Signs

Metric	2024 Value	Interpretation
Current Assets	£1,635	Very low liquid resources, a sign of weak cash reserves.
Current Liabilities	£5,406	Short-term debts significantly exceed liquid assets.
Net Current Assets (Working Capital)	-£3,771	Negative working capital indicates liquidity issues; unable to cover short-term debts with short-term assets.
Net Assets (Shareholders Funds)	-£3,771	Negative equity means liabilities exceed assets, a critical symptom of financial distress.
Trend	Worsening	Net assets declined from -£2,942 in 2023 to -£3,771 in 2024, indicating accumulating losses or liabilities.
Average Number of Employees	2	Small scale operation, consistent with micro entity classification.

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3. Diagnosis

The company exhibits symptoms analogous to a patient with a weakened cardiovascular system: the "blood flow" of cash (current assets) is insufficient to meet the "immediate demands" (current liabilities). The negative working capital and net asset position reveal that the company is running at a deficit, with liabilities exceeding assets by £3,771 as of the latest accounts.

This condition suggests the business may have trouble meeting its short-term financial obligations without additional capital or improved cash flow. The deteriorating net asset position over the last two years highlights ongoing financial strain, potentially from operational losses or accumulating unpaid debts.

However, the company remains active, with no indication of insolvency proceedings or liquidation, and recent filings are up to date, which is a positive sign of management’s compliance and intent to operate.

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4. Recommendations

To improve the financial wellness and "restore vitality," the company should consider the following targeted actions:

• Improve Cash Flow Management:
  Develop a tighter control on receivables and payables cycles to ensure inflows are accelerated and outflows managed prudently.

• Increase Capital Injection:
  Explore opportunities to raise additional equity or secure short-term financing to cover immediate liabilities and improve working capital.

• Cost Control and Profitability:
  Review operating expenses and streamline activities to reduce losses. With only two employees, focus on maximizing productivity and possibly increasing revenue streams.

• Regular Financial Monitoring:
  Implement frequent financial reviews to catch early warning signs of distress and adapt strategies promptly.

• Seek Professional Advice:
  Engage with financial advisors or turnaround specialists to develop a more detailed recovery plan, especially given the negative equity position.

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Explanation of Technical Concepts (Medical Analogies)

• Healthy Cash Flow: Like a healthy heartbeat, it ensures the business has enough liquid cash to meet immediate needs. Here, the company’s cash flow is weak, similar to a low pulse.
• Negative Working Capital: Comparable to a patient’s oxygen deficit, it means the company lacks the short-term resources to cover debts, risking operational failure.
• Net Assets/Equity: Represents the company's "financial health" or "body strength." Negative equity is like muscle wasting—indicating the business structure is weak and vulnerable.
• Trend Analysis: Monitoring these vital signs over time helps diagnose whether the condition is improving or worsening.

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