CREATE IMPACT LIMITED

Executive Summary

CREATE IMPACT LIMITED demonstrates stable short-term liquidity with positive working capital but suffers from negative equity, indicating ongoing financial strain. While the company is not currently in critical distress, targeted actions to strengthen equity and improve profitability are essential to ensure long-term financial health and operational sustainability.

CREATE IMPACT LIMITED - Analysis Report

Company Number: 12437191

Analysis Date: 2025-07-20 16:00 UTC

Financial Health Assessment for CREATE IMPACT LIMITED

---

1. Financial Health Score: C

Explanation:
The company shows some positive signs such as improving net current assets and stable current asset levels, but the persistent net liabilities and negative shareholders' funds indicate ongoing financial stress. The score C reflects a condition that is not critically unhealthy but requires attention and remedial action to avoid further deterioration.

---

2. Key Vital Signs

Metric	2024 Value	Interpretation
Fixed Assets	£4,613	Low and decreasing, indicating limited long-term investment.
Current Assets	£83,149	Healthy level of liquid assets, showing ability to cover short-term needs.
Current Liabilities	£54,181	Moderate short-term obligations; manageable given current assets.
Net Current Assets	£28,968	Positive working capital ("healthy cash flow buffer"), improved from prior year.
Creditors > 1 Year	£36,040	Significant long-term liabilities which contribute to net liabilities.
Net Assets (Shareholders Funds)	-£5,958	Negative equity signals "symptoms of financial distress" — liabilities exceed assets.
Employee Count	11	Stable workforce size, indicating operational continuity.
Share Capital	£2.00	Minimal share capital, typical for micro-entities but limits equity cushion.

Interpretation of Vital Signs:
The company has a positive working capital, implying it can meet short-term debts, akin to a patient with a steady pulse and no immediate breathing difficulty. However, negative net assets mean total debts exceed total assets, similar to underlying organ stress despite outwardly normal vitals. The reduction of net liabilities from -£12,855 in 2023 to -£5,958 in 2024 shows some improvement.

---

3. Diagnosis

CREATE IMPACT LIMITED presents the financial "symptoms" of a micro-entity that is operating with constrained equity and moderate debt levels. While the company maintains healthy short-term liquidity, the persistent negative net assets and shareholders' funds indicate accumulated losses or funding through liabilities more than equity. The company is not in immediate danger of insolvency — there is no overdue filing, and working capital is positive — but the negative equity suggests it has been "operating under distress," possibly funding operations through creditors and long-term loans.

The decrease in fixed assets and increase in current assets might indicate a shift towards liquidity or inventory rather than investment in fixed infrastructure, possibly reflecting a strategy to maintain cash flow. The stable number of employees supports ongoing operations but also represents a fixed cost burden.

---

4. Recommendations

• Equity Injection or Debt Restructuring: Consider an infusion of equity capital or re-negotiation of long-term liabilities to improve net asset position and provide a more robust financial foundation.
• Cost Control and Profitability Enhancement: Focus on improving operating efficiencies and profitability to build retained earnings and move shareholders' funds into positive territory.
• Cash Flow Monitoring: Maintain tight control of working capital to ensure the company can meet short-term liabilities without stress.
• Strategic Investment: Assess whether fixed asset base is sufficient for business needs; consider reinvestment if growth is targeted.
• Regular Financial Reviews: Implement monthly or quarterly financial health checks to monitor vital signs and detect early symptoms of distress.
• Stakeholder Communication: Maintain transparent communication with creditors and investors regarding financial position and improvement plans.

---