PAT & PIT LTD

Executive Summary

PAT & PIT LTD demonstrates a healthy financial start with positive working capital and equity, indicating good short-term liquidity and a solid capital structure for a newly formed micro-entity. The company's financial health is stable, but as it grows, careful monitoring of cash flow and profitability will be essential to maintain and improve financial wellness. Early attention to governance and risk management will support sustainable business development.

PAT & PIT LTD - Analysis Report

Company Number: 15219269

Analysis Date: 2025-07-20 16:38 UTC

Financial Health Assessment for PAT & PIT LTD

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1. Financial Health Score: B (Good)

Explanation:
PAT & PIT LTD exhibits a solid financial foundation for a newly incorporated micro-entity. The company demonstrates positive net current assets and net assets, indicating a stable liquidity position and a positive equity base. Although the scale is modest, appropriate for its size and age, the financial "vital signs" suggest a healthy start without immediate signs of distress. The grade reflects a good but early-stage financial status, with room for growth and improvement as it matures.

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2. Key Vital Signs

Metric	Value (£)	Interpretation
Fixed Assets	599	Modest investment in long-term assets, typical for a start-up.
Current Assets	2,544	Short-term resources available, including cash or receivables.
Current Liabilities	949	Obligations due within a year; manageable given current assets.
Net Current Assets	1,595	Positive working capital, indicating ability to cover short-term debts.
Total Assets less Current Liabilities	2,194	Indicates overall net resources after short-term debts.
Net Assets (Shareholders' Funds)	2,194	Equity value owned by shareholders; positive and stable for a new company.

• Liquidity Status: The company has a healthy cash flow buffer as indicated by net current assets of £1,595. This suggests sufficient short-term liquidity to meet obligations, resembling a healthy "pulse" in financial terms.
• Capital Structure: Equity fully covers net assets, indicating no reliance on long-term debt—symptom of a low-risk capital structure.
• Profit & Loss Data: Not filed yet, common for a recently incorporated micro-entity; no indication of operational profitability or losses at this stage.
• Employee Count: Only 1 employee, consistent with a micro-entity status, reflecting a lean operational structure.

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3. Diagnosis

• Overall Health: PAT & PIT LTD is in the early stages of business life, with a "healthy heart rate" in financial terms—positive working capital and equity suggest no immediate financial distress.
• Financial Stability: The absence of long-term liabilities and positive net assets indicate a solid foundation without excessive financial strain.
• Operational Status: The company is registered as active, with directors appointed and no overdue filings, showing good compliance and governance.
• Risks: As a micro-entity without an audit, there is limited visibility into operational profitability or cash flow cycles. Early-stage companies can face risks related to business development, cash flow management, and market uncertainty.
• Control: One person holds significant control (75-100% shares and voting rights), which may streamline decision-making but concentrates risk and responsibility.

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4. Recommendations

• Maintain Strong Liquidity: Continue monitoring working capital closely to avoid cash flow constraints as operational activities expand.
• Develop Profit & Loss Tracking: Even if not required to file, internally track profit and loss monthly to detect early symptoms of financial distress or operational inefficiencies.
• Plan for Growth: Consider gradual investment in fixed assets or employee count as business expands, ensuring it aligns with cash flow and market demand.
• Governance and Risk Management: With concentrated ownership, consider establishing robust internal controls and risk mitigation strategies to safeguard the company's financial health.
• Prepare for Audit Thresholds: If growth pushes the company beyond micro thresholds, prepare for audit requirements and increased compliance.
• Build Reserves: Aim to build retained earnings (P&L reserves) over time to strengthen the financial "immune system" against unforeseen shocks.

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