IT HEALTH SOLUTIONS LTD

Executive Summary

IT HEALTH SOLUTIONS LTD exhibits solid financial health with strong working capital, reduced liabilities, and increased net assets, indicating stability and growth potential. While limited reporting restricts full profitability analysis, the company's financial "vital signs" suggest a positive outlook if prudent management continues. Implementing enhanced financial controls and monitoring will support sustained financial wellness.

IT HEALTH SOLUTIONS LTD - Analysis Report

Company Number: 13820868

Analysis Date: 2025-07-20 18:15 UTC

Financial Health Assessment for IT HEALTH SOLUTIONS LTD

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1. Financial Health Score: B

Explanation:
IT HEALTH SOLUTIONS LTD demonstrates a solid financial foundation with positive net assets and healthy working capital. The company has successfully reduced its liabilities over the last year, significantly improving its net worth. However, the slight reduction in current assets and the nature of micro-entity reporting (limited detail) suggest cautious optimism rather than an unequivocally strong rating. Hence, a "B" rating reflects a generally healthy financial position with room for further strengthening.

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2. Key Vital Signs

Metric	2023 Value (£)	2022 Value (£)	Interpretation
Current Assets	116,916	153,857	Cash and near cash assets; slight decrease but still robust.
Current Liabilities	27,695	139,471*	Short-term debts; significant reduction indicates improved liquidity.
Net Current Assets	89,221	14,386*	Working capital; strong positive working capital indicates healthy short-term financial stability.
Net Assets	89,221	13,716	Equity; significant increase shows improved company value.
Average Employees	2	0	Growth in workforce suggests business activity increase.

*Note: 2022 current liabilities include £124,535 creditors after one year and £14,946 within one year, totalling £139,471.

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3. Symptoms Analysis

• Healthy Cash Flow Indicators: The company shows strong net current assets (£89k), meaning it has sufficient short-term assets to cover liabilities as they come due. This is akin to a patient maintaining a steady heartbeat—cash flow is stable enough to support daily operations.

• Liabilities Improvement: The drastic reduction in current liabilities from £139k to £27k suggests effective debt management or repayment. This is a positive "symptom" indicating the company is resolving prior financial stress.

• Increasing Net Assets: The increase in net assets from £13.7k to £89.2k indicates that the company has been accumulating retained earnings or injecting capital, strengthening its financial "immune system."

• Employee Growth: Increasing from 0 to 2 employees in one year suggests business growth and operational scaling, which is a positive indicator of future earnings potential.

• Micro-Entity Reporting: The company uses simplified accounting standards (FRS 105), which limits detailed financial disclosures. While this reduces administrative burden, it also restricts visibility into profitability and cash flows—similar to having limited diagnostic tests available.

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4. Diagnosis

IT HEALTH SOLUTIONS LTD is currently in a stable and improving financial condition. The company has effectively managed to reduce its liabilities and bolster its net assets over the last financial year. Its working capital remains strong, supporting ongoing operational needs. The increase in employees and equity points to business growth and improved financial resilience.

However, as a micro-entity, the lack of detailed profit and loss information means we cannot fully assess profitability or cash flow trends. This is comparable to a patient with stable vital signs but without a full blood panel—there could be underlying issues unseen at this stage.

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5. Prognosis

Given current indicators, the company's financial outlook is positive with cautious optimism. If IT HEALTH SOLUTIONS LTD continues its prudent financial management and business growth, it should maintain or improve its financial health. Potential risks could arise if liabilities increase suddenly or if cash flow becomes constrained, but no immediate symptoms of distress are evident.

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6. Recommendations

To ensure continued financial wellness and to deepen insight into the company’s health, consider the following actions:

• Enhance Financial Monitoring: Introduce more detailed internal accounting beyond micro-entity standards to track profitability, cash flow, and expenses more closely.

• Maintain Strong Working Capital: Continue managing liabilities prudently to preserve positive net current assets and liquidity.

• Plan for Growth: With growing employee numbers, ensure recruitment and operational costs align with revenue growth to avoid overextension.

• Build Cash Reserves: Aim to increase cash reserves as a buffer against unexpected expenses or economic downturns.

• Consider External Audit or Review: Although currently exempt, an independent audit or financial review could identify hidden risks and build stakeholder confidence.

• Stay Compliant and Timely: Ensure continued timely filing of accounts and confirmation statements to avoid penalties and maintain good standing.

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