DOUBLE OH DIGITAL LTD

Executive Summary

DOUBLE OH DIGITAL LTD maintains a fundamentally healthy financial position with positive net assets and working capital, appropriate for its micro-entity status. However, a notable decline in working capital signals emerging liquidity caution requiring close monitoring and proactive cash flow management. Strengthening financial transparency and diversifying governance can help sustain and improve the company’s financial wellness moving forward.

DOUBLE OH DIGITAL LTD - Analysis Report

Company Number: 14357956

Analysis Date: 2025-07-29 17:15 UTC

Financial Health Assessment for DOUBLE OH DIGITAL LTD

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1. Financial Health Score: B

Explanation:
DOUBLE OH DIGITAL LTD demonstrates solid financial footing with positive net assets and working capital, indicating a generally healthy financial position for a micro-entity. However, the slight decline in net current assets and net assets year-on-year signals some caution. The company maintains sufficient liquidity and low fixed asset investment typical for an IT consultancy micro-business, but the reduction in working capital suggests early symptoms of financial tightening or changing operational demands.

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2. Key Vital Signs

Metric	2024 (£)	2023 (£)	Interpretation
Fixed Assets	4,982	3,115	Small but growing investment in long-term assets, healthy for a micro-entity.
Current Assets	23,232	24,591	Slight decrease but still strong liquid resources.
Current Liabilities	18,596	16,256	Increase in short-term obligations, needs monitoring.
Net Current Assets	4,636	8,335	Working capital has decreased by 44%, a warning sign for cash flow stress.
Net Assets (Shareholders Funds)	9,618	11,450	Decline indicates either reduced retained profits or increased liabilities.

Additional Context:

• The company has only 1 employee, consistent with a micro-entity profile.
• No audit required, accounts prepared under micro-entity regime (FRS 105).
• Sole control by Mr. Dilesh Raman Lalloo (75-100% ownership and voting rights), indicating centralized decision-making.

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3. Diagnosis: What the Financial Data Reveals

• Healthy Cash Flow Fundamentals: The company’s current assets comfortably exceed current liabilities, reflecting a positive working capital buffer—akin to a patient with a stable heartbeat and good circulation. This is essential for meeting short-term debts and operational expenses.

• Symptoms of Strain: The nearly 44% drop in net current assets suggests early signs of liquidity tightening. While not critical yet, this trend is akin to a mild fever that could precede more serious health issues if not addressed.

• Stable Asset Base: Fixed assets have increased moderately, indicating ongoing investment in business tools or infrastructure. This is a positive sign of growth and reinvestment.

• Profitability Unknown: Due to micro-entity filing exemptions, profit and loss details are not publicly disclosed. This limits the ability to assess operational performance and cash generation, which are vital for a full diagnosis.

• Single Dominant Control: The company’s control by a single individual means decisions can be agile but also risk concentration. This is similar to having a single primary physician managing patient care—efficient but potentially vulnerable if that individual faces challenges.

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4. Recommendations

1. Monitor Liquidity Carefully:
   The reduction in net current assets warrants close scrutiny of cash flow management. Regular cash flow forecasts should be implemented to detect and manage any upcoming liquidity crunches before they become critical.

2. Explore Profitability Transparency:
   Although not required, consider voluntarily preparing and reviewing profit and loss accounts internally. This will provide early warning signals of operational health and inform better strategic decisions.

3. Diversify Control and Oversight:
   While centralized control allows swift decision-making, introducing an additional director or advisor could provide valuable checks and balances, reducing risk related to single-person dependency.

4. Manage Current Liabilities:
   Strategies to negotiate longer payment terms with suppliers or reduce short-term debts could improve working capital and ease financial strain.

5. Plan for Growth Investment:
   Continued modest investment in fixed assets is positive but should be balanced against liquidity needs. Prioritize investments that directly enhance service delivery or operational efficiency.

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