PRO-ACTIVE DATA LTD

Executive Summary

PRO-ACTIVE DATA LTD exhibits strong early financial health with positive net assets and no current liabilities, reflecting a stable foundation for a micro-entity in its first year. While the outlook is positive, sustained growth and careful cash flow management will be critical to maintain financial wellness as the business scales. Implementing proactive financial controls and strategic planning is recommended to ensure continued financial stability.

PRO-ACTIVE DATA LTD - Analysis Report

Company Number: 15512663

Analysis Date: 2025-07-29 17:39 UTC

Financial Health Assessment Report for PRO-ACTIVE DATA LTD

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1. Financial Health Score: B (Good)

Explanation:
PRO-ACTIVE DATA LTD exhibits a solid financial foundation for a micro-entity in its first year of operation. Key indicators such as positive net current assets, no current liabilities, and positive net assets reflect a healthy financial state. However, the company is very young, and its capital base is small. Therefore, while the financial "vital signs" are good, the prognosis depends heavily on sustaining growth and managing future liabilities.

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2. Key Vital Signs

Metric	Value (£)	Interpretation
Fixed Assets	793	Modest investment in long-term assets, typical for a startup.
Current Assets	11,941	Healthy liquidity position; cash or receivables available.
Current Liabilities	0	No short-term debts to pay; symptom of good liquidity control.
Net Current Assets	11,941	Positive working capital, indicating the company can cover short-term obligations comfortably.
Accruals and Deferred Income	(3,685)	Prepaid income or expenses deferred; manageable and common for early-stage firms.
Net Assets	9,049	Positive equity base; shareholders’ funds exceed liabilities.
Shareholders Funds	9,049	Reflects initial capital and retained earnings; indicates owner’s investment is intact.

Additional Notes:

• The company has no creditors falling due after one year and no provisions for liabilities, which means no hidden financial burdens are evident.
• Average headcount is 1 employee, consistent with micro-entity classification and early development stage.
• No audit required or conducted, common for micro-entities, but limits external assurance.

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3. Diagnosis: Financial Health Overview

PRO-ACTIVE DATA LTD is like a young patient showing stable vital signs with no immediate symptoms of distress. The company demonstrates a "healthy cash flow" position with all current liabilities cleared and sufficient current assets to maintain operations. Its balance sheet reflects a positive net asset position, meaning the business is solvent and not over-leveraged.

The absence of current liabilities or debts suggests disciplined financial management or limited operational scale during the first year. The small fixed asset base indicates the business is asset-light, which fits a software development activity profile.

However, the company is in its infancy, with only one financial year completed. Early-stage companies often face challenges such as fluctuating cash flows, customer acquisition costs, and market entry risks, which are not yet visible in the numbers because of limited operating history.

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4. Prognosis: Future Financial Outlook

With current healthy working capital and no debt burden, the outlook is cautiously positive, provided the company can:

• Maintain or grow revenues steadily to support operations.
• Manage expenses to maintain positive cash flows.
• Continue building shareholder equity through retained earnings.
• Avoid overextension in fixed assets or liabilities prematurely.

As the business grows, monitoring will be essential for early warning signs such as increasing liabilities, declining liquidity ratios, or negative working capital, which could indicate financial stress.

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5. Recommendations: Actions to Strengthen Financial Wellness

• Cash Flow Monitoring: Implement regular cash flow forecasts to anticipate funding needs and avoid liquidity crunches as the business scales.
• Expense Control: Maintain tight control over operating expenses to preserve positive working capital and avoid incurring short-term liabilities.
• Revenue Diversification: Explore expanding client base or service offerings to reduce dependency on limited contracts, improving income stability.
• Capital Planning: Consider appropriate capitalization strategies if growth requires investment, balancing equity and debt prudently.
• Financial Reporting: Even as a micro-entity, periodic internal financial reviews can provide early detection of emerging financial risks.
• Governance Enhancements: As the company grows, consider appointing additional directors or advisors to broaden oversight and strategic insights.

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