Company Number: 14174348

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

Financial Health Assessment Report for KG 16 LIMITED

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1. Financial Health Score: D

Explanation:
KG 16 LIMITED exhibits clear symptoms of financial distress as of the latest financial year ending 30 June 2024. The company has shifted from a positive net asset position (£299) in 2023 to a significant net liability position (-£1,574) in 2024. This deterioration signals a critical weakening in financial health, warranting a score of D, which reflects a high-risk warning that requires urgent attention to avoid insolvency risks.

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2. Key Vital Signs

Metric	2024 (£)	2023 (£)	Interpretation
Current Assets	4	748	Drastic fall to almost no liquid or short-term assets—very unhealthy cash position.
Current Liabilities	373	397	Slight reduction, but still significant short-term obligations.
Net Current Assets	-369	351	Shift from positive working capital to negative working capital; liquidity crunch.
Total Assets Less Current Liabilities	-369	351	Decline indicates total short-term liabilities exceed assets, alarming sign.
Net Assets (Shareholders' Funds)	-1,574	299	From healthy equity to substantial negative net worth—symptom of accumulated losses or liabilities exceeding assets.
Employees (Avg)	0	0	No employees, potentially low operational activity or outsourced functions.

Interpretation of Vital Signs:

• Healthy cash flow is indicated by positive current assets and net current assets. Here, the collapse in current assets from £748 to £4 is a severe symptom of distress.
• Negative net current assets imply the company cannot cover its short-term debts with short-term assets, signaling potential liquidity issues.
• Negative shareholders' funds suggest the company is technically insolvent on a balance sheet basis, which is a critical warning sign.
• The lack of employees may mean the company is not actively trading or is minimal in operations, which could explain the poor asset base.

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3. Diagnosis

KG 16 LIMITED is currently in a precarious financial condition. The company has transitioned from a modest positive equity position in 2023 to a deeply negative equity position in 2024. The near-zero current assets and negative net current asset position reflect a severe liquidity challenge. The negative net assets indicate accumulated losses or liabilities exceeding assets, which is a classic symptom of financial distress and potential insolvency risk.

Given the company's micro-entity status and no reported employees, it might be in an early stage or winding down operations, but the financial figures clearly indicate that without corrective measures, the company risks operational and financial collapse.

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4. Recommendations

• Urgent Liquidity Review: Conduct a detailed cash flow forecast to understand immediate cash needs. Seek emergency funding or negotiate payment terms with creditors to alleviate short-term pressure.
• Cost Control: Evaluate all expenses and overheads, especially discretionary spending. Given zero employees, focus on reducing fixed costs such as rent or service contracts if possible.
• Capital Injection: Consider raising equity capital or obtaining a loan to restore positive net assets and working capital. Without capital infusion, insolvency risk remains high.
• Operational Assessment: Review business model viability—if the company is not generating cash or assets, consider strategic options such as restructuring, sale, or voluntary liquidation to limit creditor exposure.
• Professional Advice: Engage an insolvency practitioner or financial advisor specialized in turnaround strategies to explore options and ensure compliance with directors’ duties.
• Regular Monitoring: Implement monthly financial reviews to track liquidity and solvency indicators closely.

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