IDEA ARCHITECTURE AND DESIGN LIMITED

Executive Summary

IDEA Architecture and Design Limited is exhibiting critical financial distress with persistent negative equity and liquidity shortages, indicating high insolvency risk. Immediate actions focusing on cash flow stabilization, liability restructuring, and management revitalization are essential to avert potential collapse. Without urgent intervention, the company's financial health is unlikely to improve.

IDEA ARCHITECTURE AND DESIGN LIMITED - Analysis Report

Company Number: 13574116

Analysis Date: 2025-07-29 12:26 UTC

Financial Health Assessment for IDEA ARCHITECTURE AND DESIGN LIMITED

---

1. Financial Health Score: F (Critical Condition)

Explanation:
The company is showing persistent and significant negative net current assets (working capital) and shareholders’ funds over multiple years, indicating a critical financial imbalance. The negative equity position and increasing liabilities relative to assets suggest financial distress akin to a patient with chronic organ failure—urgent intervention is necessary to avoid insolvency.

---

2. Key Vital Signs (Financial Metrics & Interpretation):

Metric	Latest Value (£)	Interpretation
Fixed Assets	1,239	Minimal investment in long-term assets, indicating limited capital base or recent asset purchases.
Current Assets	39	Extremely low liquid resources, limiting ability to meet short-term obligations ("poor blood flow").
Current Liabilities	16,174	High short-term debts that are putting acute pressure on liquidity.
Net Current Assets (Working Capital)	-16,135	Negative working capital, indicating the company cannot cover its short-term debts with available assets ("symptom of cash flow distress").
Shareholders’ Funds (Equity)	-14,896	Negative net worth, meaning liabilities exceed assets, a critical "organ failure" symptom for company solvency.
Account Filing Status	Overdue	Late filing may indicate management challenges or operational strain, a "red flag" symptom.
Employee Count	Nil	No employees reported, possibly indicating minimal operations or reliance on contractors.

---

3. Diagnosis: Overall Financial Condition Assessment

The financial data for IDEA ARCHITECTURE AND DESIGN LIMITED depicts a company in severe financial distress:

• Persistent Negative Equity: The company has carried substantial negative shareholders' funds since incorporation, worsening slightly over time. This is analogous to a patient with chronic illness where the core organs (financial foundation) are failing to maintain balance.

• Negative Working Capital: The persistent negative net current assets highlight an inability to meet short-term obligations from available liquid resources. This indicates ongoing liquidity problems, comparable to poor circulation in a human body, jeopardizing operational survival.

• Minimal Fixed Assets and Current Assets: The company holds negligible tangible or liquid assets, reducing its buffer against financial shocks.

• No Employees: The absence of staff may reflect a business model relying on freelance or contract work, or minimal operational activity, but also raises questions about capacity to generate revenue.

• Director Turnover: Both initial directors resigned in June 2023, which may suggest internal governance or operational challenges.

• Overdue Accounts Filing: Late statutory filings further suggest administrative or financial stress.

• Control Structure: The company is controlled by individuals and entities with significant shareholdings, including one controlling 75-100%, indicating concentrated control but no evidence of fresh capital injections to remedy financial health.

Summary Diagnosis: IDEA Architecture and Design Limited is in a state of financial crisis with symptoms of insolvency risk. The company’s financial “vital signs” are poor, indicating an urgent need for restructuring or capital infusion to prevent collapse.

---

4. Recommendations: Specific Actions to Improve Financial Wellness

1. Immediate Cash Flow Assessment and Management:
   Conduct a detailed cash flow forecast to identify short-term funding gaps. Seek emergency funding, either from existing shareholders or external lenders, to stabilize liquidity and prevent operational shutdown.

2. Restructure Liabilities:
   Negotiate with creditors to extend payment terms or reduce liabilities where possible, akin to reducing the strain on a failing organ.

3. Review Business Model and Revenue Generation:
   Analyze the operational model to identify why the company is not generating sufficient assets or revenue. Explore opportunities for new client acquisition or service diversification to improve income streams.

4. Governance and Management Stabilization:
   Address director resignations by appointing experienced leadership with financial turnaround expertise. Strong governance is critical to recovery.

5. Catch Up on Statutory Filings:
   Immediately file all overdue accounts to avoid penalties and restore compliance, improving company credibility with stakeholders.

6. Consider Formal Insolvency Advice:
   Given the negative equity and liquidity issues, seek specialist insolvency advice to explore options such as Company Voluntary Arrangement (CVA), administration, or liquidation if recovery is not feasible.

7. Engage Professional Support:
   Utilize financial and legal advisors to develop a robust turnaround plan and monitor progress regularly.

---