MODERN PROPERTY MANAGEMENT LIMITED

Executive Summary

MODERN PROPERTY MANAGEMENT LIMITED is a young, micro-scale company showing early signs of growth with a modest increase in net assets and working capital. The financial position is stable but fragile, with low cash reserves and high receivables posing liquidity risks. Strengthening cash management, building reserves, and careful monitoring of liabilities are crucial to enhance financial resilience and support sustainable growth.

MODERN PROPERTY MANAGEMENT LIMITED - Analysis Report

Company Number: 13537697

Analysis Date: 2025-07-20 16:47 UTC

Financial Health Assessment for MODERN PROPERTY MANAGEMENT LIMITED

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1. Financial Health Score: C

Explanation:
The company shows modest growth in net assets and working capital over the recent year, indicating some improvement but still at a fragile stage. The current financials reflect a very small scale operation with limited cash reserves and modest equity. The score "C" reflects a stable but vulnerable condition, akin to a patient recovering from minor illness but still requiring careful monitoring and improved nourishment.

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2. Key Vital Signs

Metric	2024 Value	Interpretation
Current Assets	£22,929	Increased significantly, mostly debtors
Cash at Bank	£3,679	Low cash reserves, potential liquidity risk
Debtors	£19,250	High receivables; risk if collection delayed
Current Liabilities	£20,887	Increased sharply, nearly equal to assets
Net Current Assets (Working Capital)	£2,042	Positive but marginal buffer
Net Assets (Equity)	£2,042	Small but improving shareholder funds
Share Capital	£1	Minimal paid-in capital
Employees (Average)	2	Very small workforce, limited operational scale

• Liquidity: The company has a "healthy cash flow" symptom under stress—cash is low relative to liabilities, but current assets exceed liabilities slightly.
• Receivables: A large portion of current assets are debtors (£19,250), which signals potential "symptoms of distress" if these debts are slow to convert to cash.
• Leverage: No long-term liabilities reported, implying low financial risk from debt but also limited capital investment.
• Growth: Net assets increased from £1 in 2023 to £2,042 in 2024, indicating early-stage growth but still minimal capital base.

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3. Diagnosis

The financial "vital signs" suggest MODERN PROPERTY MANAGEMENT LIMITED is in an early growth phase, operating on a micro-scale with limited cash reserves and modest equity. The company has increased its trade receivables substantially in the current year, which may indicate either growing sales or delays in client payments. The balance between current assets and liabilities is positive but narrow, indicating a "borderline healthy" working capital position.

The dependence on receivables as a large part of current assets is a "symptom" that requires close monitoring; if these debts become overdue or uncollectible, liquidity could quickly deteriorate. The low cash balance and minimal equity mean the company has limited financial "reserves" to absorb shocks or invest in growth. The presence of only two employees highlights a lean operational structure.

There is no indication of distress from overdue filings or legal actions, which supports a stable but cautious outlook. The absence of audit (due to exemption) limits insight into deeper financial health but is typical for small companies.

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4. Recommendations

To improve financial wellness and strengthen the company's financial "immune system," the following actions are advised:

1. Improve Cash Management:

   • Accelerate debtor collections to convert receivables into cash promptly.
   • Implement tighter credit control policies to reduce risk of bad debts.

2. Build Cash Reserves:

   • Aim to increase cash holdings to cover at least 3 months of current liabilities, providing a buffer against unexpected expenses.

3. Strengthen Working Capital:

   • Monitor current liabilities carefully and negotiate longer payment terms where possible to maintain positive liquidity.

4. Increase Equity Base:

   • Consider capital injection from shareholders to provide funds for growth and operational stability.

5. Financial Planning and Forecasting:

   • Develop monthly cash flow forecasts to detect and address cash shortages early.
   • Review pricing and service contracts to ensure sustainable revenue streams.

6. Operational Efficiency:

   • Maintain lean staffing but evaluate if additional resources are needed to support growth without overextending finances.

7. Regular Financial Reviews:

   • Schedule quarterly financial health check-ups to spot symptoms of distress early and adapt strategies accordingly.

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