Company Number: SC676415

Analysis Date: 2025-07-29 20:21 UTC

Financial Health Assessment Report for Established Entertainment Ltd

Assessment Date: Based on accounts to 30 September 2024

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1. Financial Health Score: B+

Explanation:
Established Entertainment Ltd demonstrates solid financial footing with steady growth in net assets and healthy liquidity. The company’s micro-entity status means financials are limited in detail, but available data shows a stable and improving balance sheet with positive working capital and no signs of distress. The score reflects strong capitalisation and liquidity, tempered slightly by the small scale and limited diversification typical of micro companies.

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2. Key Vital Signs:

Metric	2024 Figure (£)	Interpretation
Fixed Assets	31,136	Moderate investment in long-term assets, stable asset base.
Current Assets	66,846	Cash, receivables, and stock sufficient to cover short-term obligations.
Current Liabilities	32,809	Short-term debts are less than current assets, indicating good liquidity.
Net Current Assets (Working Capital)	34,081	Positive working capital, indicating ability to meet short-term liabilities comfortably.
Net Assets (Equity)	65,217	Growing net assets over 5 years, reflecting retained earnings and capital growth.
Share Capital	100	Minimal share capital, typical for micro companies, with most equity from retained earnings.
Director Advances	-4,555	Director owes money to the company, indicating some internal financing.
Employee Count	1	Very small workforce consistent with micro status.

Interpretation:

• Liquidity (Net Current Assets positive and growing): The company’s "cash flow pulse" is strong, enabling it to cover immediate debts without stress.
• Capitalisation (net assets growing from £9,803 in 2020 to £65,217 in 2024): Reflects profitable operations or capital injections, building a healthy financial "immune system".
• Director Advances: Director owes money to the company, which is a positive sign that the company’s funds are not being drained but rather being lent internally.
• Employee Base: One employee indicates a lean operation, likely reliant on the director or outsourcing.

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3. Diagnosis:

The financial "vital signs" indicate Established Entertainment Ltd is in good health. The company has steadily increased its net assets over recent years, showing it is creating value rather than eroding capital. The positive and increasing working capital demonstrates a "healthy cash flow" position, which means it can comfortably meet its short-term obligations without liquidity strain.

The fixed assets are stable, suggesting no sudden capital expenditure shocks or impairments. The minimal share capital is typical of a micro private company and is balanced by substantial retained earnings and reserves, which serve as the company’s financial "muscle" for absorbing shocks.

The company’s primary activities in the performing arts sector, which can be cyclical and vulnerable to external factors, appear well-managed financially. The lack of overdue filings and the director’s long-standing involvement (since incorporation) indicate good governance and compliance.

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4. Recommendations:

• Maintain Positive Working Capital: Continue monitoring liquidity regularly to ensure the company can handle any unforeseen expenses or downturns, especially given the volatility of the entertainment sector.
• Build Cash Reserves: While current assets are healthy, increasing cash reserves adds a buffer against sector-specific seasonal fluctuations or economic shocks.
• Explore Diversification: Consider expanding service offerings within the entertainment space to reduce reliance on a narrow revenue base and improve resilience.
• Director Advances Monitoring: Ensure that director loans or advances are regularly reviewed and formalised in documentation to avoid potential conflicts or tax issues.
• Plan for Growth: Given the company’s stable base, consider strategic investment in marketing or partnerships to scale operations beyond micro status when appropriate.
• Regular Financial Reviews: Continue timely filing and consider preparing more detailed management accounts to gain deeper insights into profitability and operational efficiency beyond balance sheet health.

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Executive Summary

Established Entertainment Ltd shows strong financial health for a micro entity, with steadily growing net assets and positive working capital indicating healthy liquidity and capitalisation. The company operates efficiently with minimal liabilities and good governance, positioning it well for stable operations in the performing arts sector. Continued focus on cash flow management and strategic growth can enhance its financial wellness further.