MICROSYSX LTD

Executive Summary

MICROSYSX LTD, a newly incorporated micro-entity, shows early signs of financial strain with negative net assets despite positive short-term liquidity. The company operates with lean resources but faces a critical need to strengthen equity and manage long-term liabilities. With focused financial management and strategic growth efforts, the company can improve its financial health and outlook.

MICROSYSX LTD - Analysis Report

Company Number: 15113218

Analysis Date: 2025-07-20 11:34 UTC

Financial Health Assessment for MICROSYSX LTD (Period ended 30 September 2024)

---

1. Financial Health Score: D

Explanation:
The company has just completed its first 13-month accounting period since incorporation in September 2023. The financials reveal a net liability position (negative net assets) despite positive net current assets, indicating early-stage financial strain. The overall financial health is below average, with clear symptoms of financial distress typical of a startup yet to reach stable profitability or capital adequacy.

---

2. Key Vital Signs

Metric	Value (£)	Interpretation
Current Assets	71,374	Healthy level of short-term assets such as cash or receivables, indicating liquidity for operations.
Current Liabilities	43,580	Short-term obligations are moderate compared to current assets, suggesting manageable immediate debt.
Net Current Assets	+27,794	Positive working capital, a "healthy cash flow pulse" indicating the company can cover short-term debts.
Creditors > 1 Year (Long-term Liabilities)	76,950	Significant long-term debts exceeding current asset coverage, a "symptom of chronic stress" on capital structure.
Net Assets (Shareholders’ Funds)	-49,281	Negative equity shows accumulated losses or undercapitalization, a "critical symptom" of financial distress.
Employees	0	No staff employed, possibly indicating lean operations or reliance on the director and/or contractors.

---

3. Diagnosis

MICROSYSX LTD, as a micro-entity in its infancy, exhibits typical early-stage financial "symptoms" of a startup: positive short-term liquidity but an overall negative net worth due to long-term liabilities exceeding total assets. The negative shareholders’ funds reflect initial funding raised as debt or operational losses, which is not unusual for a company less than a year old.

The positive net current assets show the company can meet its immediate obligations, a "healthy heartbeat" in terms of operational cash flow. However, the sizeable long-term creditors create a "chronic strain" on the company’s financial structure that must be managed carefully to avoid insolvency risk.

No employees and a single director indicate a lean operational model, potentially keeping overheads low but also signaling limited capacity for rapid scaling without additional resources.

---

4. Recommendations

• Strengthen Equity Base: Consider additional equity financing or capital injection to reduce negative net assets and improve solvency. This is akin to strengthening the company’s "immune system" to fight off financial distress.

• Manage Long-term Liabilities: Negotiate terms with creditors to restructure or extend repayment periods to ease long-term cash flow pressures and reduce the risk of default.

• Build Revenue and Profitability: Focus on business development and client acquisition to generate revenues that can cover costs and reduce reliance on external funding.

• Monitor Cash Flow Closely: Maintain vigilant cash flow management to preserve the current positive net current assets and avoid liquidity crises.

• Prepare for Growth Staffing: Plan for selective hiring or outsourcing to build capacity without compromising the lean cost structure.

• Regular Financial Reviews: Implement monthly or quarterly financial health checks to detect early "symptoms" of distress and adjust strategies promptly.

---