MAROCAFELLA LTD

Executive Summary

Marocafella Ltd is currently in a financially fragile state, showing negative working capital and net assets shortly after incorporation, indicating liquidity and solvency challenges typical of early-stage startups. Immediate action to secure funding and manage liabilities is critical to improve its financial health and avoid insolvency risks. With effective cash flow management and business development, the company has potential to recover and stabilize.

MAROCAFELLA LTD - Analysis Report

Company Number: 14817070

Analysis Date: 2025-07-20 11:03 UTC

Financial Health Score: D

Given the negative net assets and net current liabilities, Marocafella Ltd shows clear signs of financial distress at this early stage. The company is still very young, incorporated in 2023, but the balance sheet indicates underlying liquidity and solvency challenges.

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Key Vital Signs

Metric	Value	Interpretation
Current Assets	£76	Extremely low cash and short-term assets, insufficient to cover liabilities
Current Liabilities	£3,054	Amount due within one year, significant relative to assets
Net Current Assets (Working Capital)	-£3,328	Negative working capital, a symptom of cash flow stress
Net Assets	-£3,328	Negative equity, indicating liabilities exceed assets
Shareholders’ Funds	-£3,328	Owner’s stake is negative, reflecting accumulated losses or funding shortfall
Average Number of Employees	0	No staff employed, possibly no operational activity yet

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Symptoms Analysis

• Negative Working Capital: The company has £3,054 due soon but only £76 in current assets, meaning it lacks liquid resources to meet short-term obligations. This is akin to a patient with dangerously low blood pressure—there is a risk of operational collapse if cash cannot be raised.

• Negative Net Assets: Shareholders’ funds are negative by £3,328, suggesting that liabilities exceed assets. This symptom often points to insolvency risk if the situation persists.

• No Audit and Micro-Entity Reporting: The accounts are prepared under micro-entity provisions without audit, limiting detailed insight but indicating the company is at a very early stage or small scale.

• No Employees: The absence of staff may mean the company is not yet fully operational or is in a startup phase, which is common but adds uncertainty about future cash inflows.

• Prepayments and Accrued Income Negative: There is a negative figure of £350 under prepayments/accrued income, which may indicate accounting adjustments but further stresses liquidity.

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Diagnosis

Marocafella Ltd exhibits early symptoms of financial distress, primarily driven by a severe liquidity imbalance and negative equity. The company's financial "vital signs" indicate it is not currently in a healthy state. The negative working capital and net liabilities suggest the business is underfunded or has incurred initial losses since incorporation.

However, given the company’s very recent incorporation (April 2023) and micro-entity status, these figures may reflect startup-phase investments or timing differences rather than chronic operational failure. The absence of employees and minimal current assets indicate the business may still be in its incubation stage.

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Prognosis

If the current situation persists without new capital injection or improvement in cash flow, Marocafella Ltd risks insolvency. However, as a newly formed entity, there is potential for recovery if the director can secure funding, generate sales, or restructure liabilities.

The prognosis depends heavily on the company’s ability to:

• Raise working capital promptly to cover short-term debts
• Develop operational activity to generate revenues
• Manage creditors proactively to avoid enforcement action

Without these interventions, the financial health may deteriorate further.

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Recommendations

1. Immediate Cash Flow Management: Prioritize raising cash to cover current liabilities. This may involve director loans, shareholder funding, or short-term financing.

2. Review and Restructure Liabilities: Negotiate payment terms with creditors to extend deadlines or reduce amounts payable in the short term, easing liquidity pressure.

3. Develop a Detailed Business Plan: Outline clear revenue generation strategies and cost control measures to transition from startup investment to operational profitability.

4. Regular Financial Monitoring: Closely track cash flow forecasts and key financial metrics to identify warning signs early and take corrective action.

5. Consider Professional Advice: Engage with an insolvency practitioner or financial advisor if liquidity issues worsen to explore restructuring or protection options.

6. Compliance Maintenance: Ensure all filings and statutory requirements are met timely to avoid penalties that could exacerbate financial strain.

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