GOOGANS CONSULTANCY LIMITED

Executive Summary

GOOGANS CONSULTANCY LIMITED is financially stable with strong liquidity and early profitability, signifying a healthy financial start. However, significant deferred income requires attention to maintain cash flow balance. With prudent management and strategic growth focus, the company’s financial prognosis is positive.

GOOGANS CONSULTANCY LIMITED - Analysis Report

Company Number: 15152206

Analysis Date: 2025-07-20 13:09 UTC

Financial Health Assessment Report: GOOGANS CONSULTANCY LIMITED

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1. Financial Health Score: B

Explanation:
GOOGANS CONSULTANCY LIMITED demonstrates a generally sound financial position for a newly incorporated micro-entity. The company has positive net current assets and net assets, indicating a stable foundation. However, a significant portion of liabilities is accrued or deferred income, which warrants monitoring. The overall financial health is good but not yet robust given the company’s early stage and limited operational history.

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2. Key Vital Signs

Metric	Value (£)	Interpretation
Current Assets	91,694	Healthy level of liquid and short-term assets, including cash.
Current Liabilities	7,267	Low short-term debts relative to assets; manageable obligations.
Net Current Assets	84,427	Strong working capital, indicating good short-term liquidity.
Accruals and Deferred Income	70,099	Large prepayments or unearned income; requires scrutiny of timing and recognition.
Net Assets (Shareholders' Funds)	14,328	Positive equity reflecting retained earnings despite early stage.
Cash at Bank and in Hand	89,479	Excellent cash position, suggesting solid cash flow or initial funding.
Profit and Loss Account (Retained Profit)	14,228	Indicates the company is generating profits, a positive symptom.

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3. Diagnosis: Business Financial Health

• Healthy Cash Flow: The company holds a strong cash balance (£89,479) and net current assets (£84,427), which are vital signs of liquidity health—meaning it can cover its short-term obligations comfortably.
• Symptoms of Deferred Income: The sizable accruals and deferred income (£70,099) point to revenue received but not yet earned or costs recognized in advance. While not inherently negative, this requires careful management to avoid cash flow timing issues.
• Early Profitability: A retained profit of £14,228 in the first financial year signals early profitability—a positive sign of business viability and operational efficiency, especially for a start-up.
• Low Leverage and Risk: Current liabilities are modest (£7,267), and there is no indication of long-term debt. This low leverage reduces financial risk and bankruptcy threat.
• Limited Operating History: Incorporated only in late 2023 with micro-entity status, the company is at an early stage, so financial trends are limited. The diagnosis should factor in this infancy phase where volatility is possible.
• Control and Governance: The company is wholly controlled by a single entity (Googans Js Limited), which centralizes decision-making but could pose governance risks in terms of oversight and diversification of strategic input.

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4. Recommendations

• Monitor Deferred Income Carefully: Ensure all accruals and deferred income are accurately matched with revenue recognition periods to avoid liquidity mismatches and ensure compliance with accounting standards.
• Build Financial Reserves: Though cash is currently strong, aim to retain profits and build reserves to buffer against future operational risks or unexpected expenses as the business grows.
• Enhance Financial Reporting: As the company matures, consider expanding beyond micro-entity reporting standards to provide deeper insights into profitability drivers and cash flow forecasting.
• Plan for Growth: Use current healthy liquidity to invest in scalable business activities, marketing, or technology enhancements that can support sustainable revenue growth.
• Governance Review: With a single controlling shareholder, consider establishing advisory or oversight mechanisms to improve strategic decision-making and risk management.
• Regular Financial Health Check-ups: Schedule periodic financial reviews to detect any emerging symptoms of distress early, such as declining liquidity, rising debts, or profit erosion.

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