LURIS SYSTEMS LTD

Executive Summary

LURIS SYSTEMS LTD, a newly formed micro-entity in software development, shows early signs of financial strain with negative working capital and shareholders' funds. Immediate capital injection and tight cash flow management are critical to reversing liquidity risks and establishing a healthy financial foundation. With proactive measures, the company can progress from start-up fragility to operational stability.

LURIS SYSTEMS LTD - Analysis Report

Company Number: 15361556

Analysis Date: 2025-07-29 17:39 UTC

Financial Health Assessment for LURIS SYSTEMS LTD (as at 31 December 2024)

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1. Financial Health Score: D

Explanation:
The company shows significant signs of financial distress at this early stage of its life cycle. Negative net current assets and negative shareholders' funds indicate an imbalance between short-term obligations and available liquid assets. As a newly incorporated micro-entity with minimal operations, this score reflects the early "symptoms" of financial strain which require careful management.

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2. Key Vital Signs:

Metric	Value (£)	Interpretation (Vital Sign)
Fixed Assets	0	No long-term investments or property owned yet.
Current Assets	165	Very low liquid resources available to cover short-term debts.
Current Liabilities	910	Short-term debts outweigh assets significantly.
Net Current Assets (Working Capital)	-745	Negative working capital, indicating a liquidity challenge.
Total Net Assets (Shareholders’ Funds)	-745	Negative equity, indicating liabilities exceed assets.
Average Number of Employees	0	No staff employed yet, possibly in start-up phase.

Interpretation:

• Negative working capital is a critical symptom indicating the company may struggle to meet short-term obligations on time.
• Negative shareholders' funds suggest the company is "underwater," meaning it owes more than it owns—a classic symptom of financial distress.
• Absence of fixed assets and employees is typical for an early-stage tech start-up but means no cushion from tangible value or operational capacity yet.
• The current liabilities are more than five times the current assets, indicating liquidity risks.

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3. Diagnosis:

LURIS SYSTEMS LTD is in the very early stages of its business lifecycle, having been incorporated only recently (December 2023) and filing its first financial accounts for 2024. The financial "vital signs" reveal a company in a fragile state:

• The negative net current assets highlight immediate liquidity stress, where short-term debts exceed available liquid resources.
• The negative net assets/shareholders funds indicate the company’s balance sheet is currently in a deficit position, potentially from start-up costs or initial funding structure.
• No employees or fixed assets suggest the company is either in a planning phase or has not yet operationalized significant business activities.

This situation is not uncommon for a start-up, but it requires close monitoring and active cash management. Without intervention or additional capital injection, these symptoms could progress to more serious financial distress.

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4. Recommendations:

Immediate Actions:

• Secure Additional Funding: The company requires fresh capital to improve liquidity and move net assets into a positive territory. This could be through directors’ loans, equity investment, or external financing.
• Tighten Cash Flow Forecasting: Develop a detailed cash flow forecast to anticipate periods of cash shortfall and plan accordingly.
• Limit Expenses: Minimise operational costs until a steady revenue stream is established to conserve cash resources.
• Explore Grants or Start-up Support: Investigate government grants or schemes designed to support tech start-ups in business and domestic software development.

Medium-Term Actions:

• Build Working Capital Cushion: Aim to convert negative working capital into a positive position by increasing current assets via sales or investment.
• Develop Business Operations: Progress from planning to revenue-generating activities to improve cash inflows.
• Regular Financial Monitoring: Schedule quarterly reviews of financial statements and liquidity position to detect any worsening symptoms early.

Governance/Compliance:

• Maintain timely filing of accounts and confirmation statements to avoid penalties and ensure transparency.
• Directors should document financial strategies and decisions in board minutes to demonstrate proactive management.

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Medical Analogy Summary:

LURIS SYSTEMS LTD currently exhibits "symptoms of financial distress" akin to a patient showing early signs of dehydration and weakness—low liquidity and negative equity are the warning signs. While not yet in critical condition, without intervention (capital infusion and expense control), the company risks moving into more severe "financial illness." The prognosis depends heavily on management’s actions to stabilize and improve its "financial health."

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