LIFE TRANSFORMATION COACHING LTD

Executive Summary

Life Transformation Coaching Ltd is in its infancy with early-stage financial challenges including negative working capital and net liabilities, indicating liquidity and solvency concerns. These issues are common in start-ups but require immediate attention through capital infusion, cost control, and revenue growth strategies. With focused management, the company has the potential to restore its financial health and build a sustainable business foundation.

LIFE TRANSFORMATION COACHING LTD - Analysis Report

Company Number: 14569475

Analysis Date: 2025-07-29 12:50 UTC

Financial Health Assessment for Life Transformation Coaching Ltd (as of 31 January 2024)

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1. Financial Health Score: D

Explanation:
The company currently shows signs of financial distress with net liabilities and negative working capital. While it is early in its life cycle (incorporated in 2023), the negative net assets and net current liabilities indicate the business is not yet financially stable. The score reflects a need for close monitoring and prompt remedial action to restore financial health.

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2. Key Vital Signs

Metric	Value (£)	Interpretation
Current Assets	1,021	Very low cash and near-cash resources; limited liquidity to cover short-term obligations.
Current Liabilities	1,947	Short-term debts exceed current assets, indicating working capital deficiency.
Net Current Assets	-926	Negative working capital, a symptom of potential cash flow problems and inability to meet debts.
Net Assets / Shareholders' Funds	-1,225	Company's total liabilities exceed its assets, showing insolvency on a balance sheet basis.
Average Number of Employees	1	Micro-entity status with minimal staff, typical for start-ups but limits operational capacity.

Interpretation:

• Net Current Assets Negative (-£926): This is akin to a patient having a "deficiency in blood volume"—the company's immediate resources are insufficient to meet current obligations, which can cause liquidity cramps.
• Net Liabilities (-£1,225): Reflects that total liabilities exceed assets, indicating the company is technically insolvent. This is a serious symptom analogous to an organ malfunction, requiring urgent attention.
• Micro-entity Status: The company benefits from simplified reporting but also faces limitations in scale and resources.
• No Audit Required: This reduces compliance cost but may limit external assurance on financial data.

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3. Diagnosis

Life Transformation Coaching Ltd is in the early stages of its business lifecycle, with financial statements covering just over one year. The financial 'symptoms' suggest the company is under stress:

• Liquidity Strain: Negative working capital indicates the company may struggle to pay short-term creditors promptly.
• Capital Deficiency: Negative shareholders' funds signal that the business has consumed more resources than it has generated or raised, possibly due to start-up costs or initial losses.
• Limited Financial Cushion: The low current assets figure means there is little buffer for unexpected expenses or delays in revenue.

However, these symptoms are not uncommon in newly established businesses that are investing in growth and client acquisition. The diagnosis reflects a fragile financial condition that requires careful management to avoid escalation into financial distress or insolvency.

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4. Recommendations

To improve financial wellness and stabilize the company’s financial health, the following actions are recommended:

• Enhance Liquidity Management:

  • Prioritize collection of receivables and negotiate extended payment terms with suppliers to reduce immediate cash flow pressure.
  • Maintain a cash flow forecast to anticipate shortages and plan accordingly.

• Increase Capital Injection:

  • Consider additional equity investment or loans from the director (Mrs Tetyana Siziba) or third parties to shore up net assets and working capital.
  • Explore grants or start-up funding schemes applicable to micro-entities in management consultancy.

• Cost Control:

  • Keep operating expenses minimal until revenues build up.
  • Review all discretionary spending and defer non-essential costs.

• Revenue Growth Focus:

  • Accelerate client acquisition and service delivery to increase income.
  • Leverage the director's control and expertise to expand business networks and opportunities.

• Regular Financial Review:

  • Monitor monthly management accounts to detect early warning signs.
  • Seek professional advice on financial planning and tax efficiency.

• Compliance and Governance:

  • Ensure timely filing of accounts and confirmation statements to avoid penalties and maintain good standing.
  • Keep clear records of financial transactions to facilitate transparency and decision-making.

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Medical Analogy Summary

Life Transformation Coaching Ltd currently shows symptoms of financial distress such as negative working capital and net liabilities—similar to a patient with low vital signs needing urgent care. However, as a newly formed company, these symptoms may reflect early-stage challenges rather than chronic illness. With prompt intervention and disciplined financial management, the company’s prognosis can improve significantly, moving toward a state of healthy cash flow and sustainable growth.

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