DAN SCOTT LIMITED

Executive Summary

DAN SCOTT LIMITED exhibits early-stage financial characteristics with very low asset and equity levels, and a tight liquidity position. While currently solvent and compliant, the company shows symptoms of financial fragility that require strengthening of working capital and equity to ensure sustainable operations. Proactive financial management and operational development are recommended to improve its financial health and resilience.

DAN SCOTT LIMITED - Analysis Report

Company Number: 14502614

Analysis Date: 2025-07-29 12:33 UTC

Financial Health Assessment of DAN SCOTT LIMITED

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1. Financial Health Score: D+

Explanation:
Given its micro-entity status, very low net assets, and minimal working capital, DAN SCOTT LIMITED is currently in a fragile financial position. The company shows limited financial "vital signs" typical of an early-stage or minimally active business, with small asset bases and thin equity. The score reflects concerns about sustainability and liquidity, though no immediate distress signals, such as overdue filings or large liabilities, are present.

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2. Key Vital Signs

Metric	2024 Value (£)	Interpretation
Fixed Assets	6,148	Small asset base, likely equipment or intangible assets.
Current Liabilities	6,024	Short-term debts almost equal to fixed assets, indicating tight liquidity.
Net Current Assets	-6,024	Negative working capital, meaning current liabilities exceed current assets.
Net Assets (Shareholders' Funds)	124	Extremely thin equity cushion; company barely covers liabilities.
Employees	0	No staff employed, suggesting minimal operational activity.

Interpretation:

• The company has a "symptom" of liquidity stress, as current liabilities nearly match or exceed the company's asset base, leaving very little buffer for day-to-day operations.
• Net assets are positive but marginal (£124), indicating a very fragile "financial pulse."
• No employees indicate the company is likely not operational or is in a startup/pilot phase.
• No overdue filings or compliance issues suggest healthy regulatory adherence.

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3. Diagnosis

• Liquidity and Working Capital: The company shows symptoms of a tight cash flow environment, with working capital in deficit. This could be due to limited sales, delayed receivables, or early-stage investment in fixed assets without corresponding operating income.
• Solvency: While the company remains solvent (net assets positive), the very low equity base and negative working capital are warning signs that it is vulnerable to any unexpected expenses or revenue shortfalls.
• Operational Activity: Absence of employees combined with minimal asset base and liabilities suggests limited or nascent business operations. This can be common in newly incorporated companies or those in early development stages.
• Governance: Single director and sole controlling shareholder provide clear decision-making but also concentration risk. The director's occupation as a community worker may indicate a social or mission-driven business, consistent with the residential care SIC code.

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4. Recommendations

1. Improve Working Capital Management:

   • Consider strategies to increase current assets, such as accelerating receivables or securing short-term financing to cover liabilities comfortably.
   • Avoid accumulation of short-term debts that could strain cash flow.

2. Strengthen Equity Base:

   • Infuse additional capital to build a stronger equity buffer, enhancing solvency and investor confidence.
   • Explore grants or funding options tailored for social care enterprises.

3. Operational Development:

   • If business operations are planned but not yet active, initiate revenue-generating activities to improve cash inflows.
   • If dormant or inactive, formalize plans or consider restructuring to reduce ongoing costs.

4. Financial Monitoring:

   • Implement regular financial reviews to monitor liquidity and solvency "vital signs."
   • Maintain compliance with filings to avoid penalties and maintain creditor and stakeholder trust.

5. Risk Management:

   • Plan for contingencies given the limited financial cushion.
   • Consider appointing additional directors or advisors to broaden governance perspectives.

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