LEFT IN AWE RECORDS LTD

Executive Summary

LEFT IN AWE RECORDS LTD is exhibiting financial symptoms of distress with negative net assets and minimal liquidity over three consecutive years, indicating a fragile financial state. Immediate actions to improve cash flow, increase capital, and control costs are essential to stabilize and enhance financial health. With targeted interventions, the company can potentially recover and strengthen its operational viability.

LEFT IN AWE RECORDS LTD - Analysis Report

Company Number: 14251227

Analysis Date: 2025-07-29 20:03 UTC

Financial Health Assessment: LEFT IN AWE RECORDS LTD

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1. Financial Health Score: D

Explanation:
The company shows clear signs of financial distress with persistent negative net assets (shareholders’ funds) of £91, indicating that liabilities exceed assets. This negative equity position is a significant concern, especially for a micro-entity operating in the sound recording and music publishing industry. The lack of growth or improvement over three years signals an ongoing challenge in achieving financial stability.

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2. Key Vital Signs

Vital Sign	2024 Value (£)	Interpretation
Current Assets	268	Very low cash or near-cash assets, inadequate to support day-to-day operations robustly.
Current Liabilities	119	Small short-term debts, but relative to assets, still significant.
Net Assets (Shareholders’ Funds)	-91	Negative net worth indicates liabilities outweigh assets, a symptom of financial distress.
Staff Numbers	1	Sole employee (likely the director), indicating a very small operational scale.

Interpretation:

• The company’s "vital signs" reflect a fragile financial state. The current assets barely cover current liabilities, and negative net assets are a critical warning sign.
• The capital structure is weak with no buffer to absorb shocks.
• The company operates on a micro scale, which can limit access to capital but should also mean low overheads.

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3. Diagnosis

The financial "symptoms" reveal that LEFT IN AWE RECORDS LTD is currently in a state of financial weakness. The persistent negative net assets over the last three years suggest the company has been operating at a loss or has accumulated deficits, which is typical for early-stage or start-up businesses, especially in creative industries with uncertain revenue streams.

The low current assets (£268) compared to liabilities (£119) imply a tight liquidity position, restricting the company’s ability to cover immediate obligations comfortably. This "strained cash flow" condition can hinder operational flexibility and increase the risk of insolvency if not addressed.

Given the company’s micro-entity status, the small scale might limit options for raising finance, and the sole employee structure means operational capacity is minimal, increasing vulnerability to market changes.

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4. Prognosis

Without intervention, the company risks continued financial strain. The negative net assets and minimal liquidity suggest that unless the business can generate positive cash flows or secure additional funding, it may face challenges sustaining operations. However, as a micro-entity, there is potential for recovery if strategic actions are taken to improve profitability and cash management.

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5. Recommendations

• Inject Additional Capital: Consider equity investment or director loans to improve net assets and liquidity. This acts like a "blood transfusion" to revive financial health.
• Increase Revenue Streams: Explore new music publishing opportunities, licensing deals, or diversified income sources to boost cash inflow.
• Cost Control Measures: Maintain tight control on expenses to preserve working capital and avoid further erosion of shareholders’ funds.
• Cash Flow Management: Implement rigorous cash flow forecasting and monitoring to anticipate shortfalls early—akin to regular health check-ups.
• Seek Professional Advice: Engage with a financial advisor or accountant specializing in creative industries to develop a turnaround strategy.
• Monitor Key Metrics Regularly: Track liquidity ratios and net asset position quarterly to detect any worsening symptoms early.

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