Company Number: 14094529

Analysis Date: 2025-07-20 13:03 UTC

Financial Health Assessment for Queen Accountancy Limited

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1. Financial Health Score: D

Explanation:
The company shows clear signs of financial distress in the latest year, reflected by a substantial net liability position and sharply negative working capital. While the prior years indicated modest positive net assets and working capital, the sudden deterioration in 2024 severely impacts the company’s financial stability. This grade signals urgent attention is needed to restore financial health.

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2. Key Vital Signs

Metric	2024 (£)	2023 (£)	Interpretation
Fixed Assets	320	1,062	Minimal long-term assets; slight decline
Current Assets	1,727	9,491	Sharp decrease in liquid and short-term assets
Current Liabilities	27,049	8,844	Significant increase in short-term obligations
Net Current Assets	-25,322	648	Negative working capital indicates liquidity issues
Total Assets less Current Liabilities	-25,002	1,710	Overall asset coverage below liabilities
Net Assets / Shareholders' Funds	-25,002	1,710	Negative equity signals insolvency risk
Average Number of Employees	0	1	No employees in 2024, possible operational cutbacks

Interpretation of Vital Signs:

• Healthy cash flow is indicated by positive net current assets, which the company had in 2023 but lost drastically in 2024.
• Negative net current assets signal the company may struggle to meet short-term liabilities, a symptom of liquidity distress.
• The net asset deficit (-£25k) is severe for a micro-entity, suggesting accumulated losses or unrecorded liabilities.
• The reduction in fixed and current assets alongside rising liabilities resembles a patient suffering acute financial trauma.

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3. Diagnosis

Queen Accountancy Limited was in a relatively stable financial condition during 2022 and 2023, with positive net assets and manageable current liabilities. However, the year ended May 2024 reveals a sudden and significant deterioration: the company’s current liabilities tripled while current assets fell sharply, resulting in negative working capital and net assets.

This "acute financial episode" indicates either a rapid increase in debts or expenses or a sudden drop in receivables/cash inflow. The absence of employees in 2024 suggests operational downsizing or halted activities, which may have contributed to the financial decline.

Given the company is a micro entity, the impact of such a shift is critical. Negative shareholders' funds imply the owners have effectively lost their capital investment, placing the company at risk of insolvency if this trend is not reversed quickly.

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4. Recommendations

• Liquidity Restoration:
  Prioritize improving working capital by negotiating extended payment terms with creditors, accelerating receivables collection, or injecting additional cash resources. Consider short-term financing options cautiously.

• Cost Control and Operational Review:
  Investigate the reasons for employee reduction and assess whether fixed costs can be further aligned with current business volume. Identify unnecessary expenses and reduce overheads.

• Financial Restructuring:
  Engage with a financial advisor or insolvency practitioner early to explore restructuring options before liquidity issues worsen. This could include debt rescheduling or equity injection from shareholders.

• Enhanced Financial Monitoring:
  Implement regular cash flow forecasting and budget controls to detect early warning signs of distress. Maintain transparent accounts and comply with filing deadlines to avoid regulatory penalties.

• Strategic Business Review:
  Evaluate the business model and market position to identify revenue growth opportunities or diversification to stabilize income streams.

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Executive Summary

Queen Accountancy Limited experienced a sharp financial decline in the year ending May 2024, marked by a severe liquidity crunch and negative net assets, posing significant solvency concerns. Immediate financial and operational actions are necessary to stabilize cash flow, reduce liabilities, and restore shareholder equity to ensure ongoing viability.