ITQAN RANY LTD

Executive Summary

ITQAN RANY LTD is a young micro-entity showing positive net assets growth but facing liquidity pressures and increasing long-term liabilities. The company’s financial health is stable but fragile, requiring improved cash flow management and debt control to ensure sustainable operations. With prudent financial oversight, ITQAN RANY LTD can strengthen its financial resilience and support future growth.

ITQAN RANY LTD - Analysis Report

Company Number: 13453829

Analysis Date: 2025-07-20 18:26 UTC

Financial Health Assessment for ITQAN RANY LTD (as of 30 June 2024)

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1. Financial Health Score: C

Explanation:
The company demonstrates a modest but stable financial position typical for a micro-entity at an early stage of development. While net assets and shareholders’ funds have grown year-on-year, there are warning signs regarding liquidity pressures and increasing long-term liabilities, which temper the overall robustness of the financial health. The score C reflects a company that is fundamentally solvent but facing symptoms of financial strain that require careful management to maintain sustainability.

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2. Key Vital Signs

Metric	2024 Value (£)	Interpretation
Current Assets	104,315	Reasonably healthy level of short-term assets (cash, receivables).
Current Liabilities	93,108	High short-term debt obligations relative to current assets.
Net Current Assets (Working Capital)	11,207	Positive but low buffer, indicating potential liquidity risk.
Creditors Due After One Year	25,339	Significant increase in long-term liabilities compared to prior year, raising solvency concerns.
Net Assets / Shareholders’ Funds	36,546	Positive equity base, increasing steadily over 4 years.
Number of Employees	2	Small workforce consistent with micro-entity status, manageable overhead.
Filing Status	Up-to-date	Compliance with filing deadlines reduces risk of penalties.

Interpretation:

• Liquidity (Working Capital): The company’s ability to cover its short-term debts with its current assets has weakened, falling from £31,097 in 2023 to £11,207 in 2024. This shrinking buffer is a symptom of potential cash flow tightness, akin to a patient whose pulse is weakening but still stable.
• Solvency: Despite liquidity concerns, net assets have increased, reflecting retained earnings or capital injections. However, the rise in creditors due after more than one year (long-term debt) to £25,339 signals increasing financial leverage, which if unchecked, may burden future operations.
• Profitability: Profit and loss data is not available, but the increase in net assets suggests profitability or capital inflows. Absence of audit and detailed P&L limits full diagnostic clarity.

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3. Diagnosis

ITQAN RANY LTD exhibits the characteristics of a young, micro-sized IT consultancy with a stable but fragile financial constitution. The positive net assets and shareholders’ funds indicate that the company is “alive” and has a foundation to build upon. However, the decreasing working capital margin and rising long-term liabilities represent symptoms of financial stress akin to early signs of a chronic condition. The company’s liquidity is currently adequate but not healthy enough to comfortably absorb shocks or unexpected expenses.

The small workforce and compliance with regulatory filing obligations are positive signs, showing operational control and governance discipline. However, the increase in creditor obligations beyond one year suggests the company may be relying on external financing to fund growth or operations, which requires close monitoring.

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4. Recommendations

To improve financial wellness and strengthen resilience, the company should consider the following steps:

• Improve Liquidity Management:

  • Accelerate cash collections and manage payables to maintain a healthier working capital buffer.
  • Implement cash flow forecasting to anticipate and mitigate short-term cash shortages.

• Manage Long-Term Debt:

  • Review the terms and necessity of creditors due after more than one year. Explore options to refinance or reduce long-term debt to lower financial risk and interest burden.

• Enhance Profitability and Capital Retention:

  • Focus on improving profit margins through cost control and revenue growth strategies to build retained earnings and strengthen equity.

• Financial Reporting Transparency:

  • Consider preparing and filing full profit and loss accounts to provide clearer insight into operational performance, aiding stakeholders and management decision-making.

• Strategic Planning:

  • Develop a medium-term business plan addressing growth, financing needs, and risk management to ensure sustainable financial health.

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