N PAINTS LIMITED

Executive Summary

N PAINTS LIMITED maintains a modestly healthy financial position with positive net assets and working capital, but declining equity and low cash reserves signal cautious concern. The company’s lean operation with no employees and narrow liquidity buffer suggests limited growth and potential cash flow vulnerability. Strategic improvements in liquidity management and operational capacity are recommended to strengthen financial resilience and support future stability.

N PAINTS LIMITED - Analysis Report

Company Number: 13638812

Analysis Date: 2025-07-20 15:07 UTC

Financial Health Assessment for N PAINTS LIMITED

---

1. Financial Health Score: C

Explanation:
N PAINTS LIMITED shows modest financial stability with positive net assets and working capital, indicating basic solvency. However, the slight decline in net assets and net current assets, combined with very low cash reserves and no employees, suggests the company is experiencing mild symptoms of financial strain and limited operational scale, warranting cautious monitoring and strategic improvement.

---

2. Key Vital Signs

Metric	2023 Value (£)	Interpretation
Cash at Bank	2,972	Low cash reserves indicate limited liquidity buffer; just enough to cover short-term liabilities.
Current Liabilities	2,145	Small current liabilities mainly taxes and social security; manageable but require timely payment.
Net Current Assets	827	Positive but low working capital; suggests tight short-term liquidity—"borderline healthy cash flow."
Net Assets	4,646	Positive equity base indicating solvency but has decreased from prior year—"symptom of slight asset erosion."
Shareholders’ Funds	4,646	Equity fully owned by the sole director; no external shareholders, providing control but concentration risk.
Fixed Assets	3,819	Tangible assets mainly machinery and vehicles; depreciating but still significant for business operations.
Employees	0	No employees, possibly indicating minimal operational activity or outsourcing.

---

3. Diagnosis: Financial Condition Overview

N PAINTS LIMITED is a small private company engaged in vehicle maintenance and repair, with a sole director owning all shares. The company exhibits core signs of financial health such as positive net assets and working capital, which are vital signs of solvency and liquidity. However, the decline in net assets from £5,963 in 2022 to £4,646 in 2023 signals a loss absorption or asset depreciation exceeding reinvestment, a symptom of mild financial distress.

The company’s liquidity ("cash at bank") is low relative to current liabilities, indicating a narrow margin to cover short-term obligations. While the company is not in immediate danger, this tight liquidity can cause operational stress if unexpected expenses arise. The absence of employees suggests a lean operational model, which may control costs but might also limit growth capacity or scalability.

Furthermore, the company benefits from exemption from audit requirements, reflecting its small size but also implying less external financial scrutiny. The director’s dual role as sole significant controller concentrates decision-making but increases dependence on that individual’s capacity and oversight.

---

4. Recommendations: Path to Financial Wellness

• Improve Liquidity Reserves: Increase cash holdings to at least cover 3-6 months of current liabilities. This could involve better cash flow management, faster receivables collection, or short-term financing arrangements.

• Monitor and Manage Asset Depreciation: Review the fixed assets’ usage and maintenance to optimize their lifespan or consider reinvestment in more efficient machinery as needed to avoid further erosion of net assets.

• Expand Operational Capacity: Explore hiring at least a part-time employee or outsourcing critical tasks to ensure business continuity and enable growth beyond the current minimal operational model.

• Implement Regular Financial Forecasting: Adopt monthly cash flow projections and budgeting to detect early "symptoms" of financial distress and react proactively.

• Consider External Advice: Engage with a financial advisor or accountant periodically for independent review and strategic planning, especially given the lack of audit scrutiny.

• Maintain Compliance and Filing Discipline: Continue timely filing of accounts and confirmation statements to avoid penalties and maintain good standing with Companies House.

---