ROUNDSTONE CONSULTING LTD

Executive Summary

Roundstone Consulting Ltd shows persistent financial distress with negative net assets and working capital deficits over multiple years, reflecting liquidity and solvency challenges. Immediate action through capital infusion, cash flow improvement, and operational adjustments is essential to stabilize and restore financial health. Timely compliance with filings indicates governance discipline, providing a foundation for recovery efforts.

ROUNDSTONE CONSULTING LTD - Analysis Report

Company Number: 13024651

Analysis Date: 2025-07-20 14:30 UTC

Financial Health Assessment for Roundstone Consulting Ltd

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1. Financial Health Score: D

Explanation:
Roundstone Consulting Ltd currently exhibits clear symptoms of financial distress, reflected in persistent net liabilities, negative shareholders’ funds, and worsening working capital positions over multiple years. While the company remains active and compliant with filing deadlines, its financial "vital signs" indicate an unhealthy state that requires urgent attention to avoid further deterioration.

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2. Key Vital Signs

Metric	2024 Value	Interpretation
Net Current Assets	-£2,796	Negative working capital ("cash flow blockage"), indicating the company owes more short-term than it owns in current assets.
Net Assets (Shareholders Funds)	-£4,560	Negative net worth ("balance sheet anemia"), meaning liabilities exceed assets, a serious concern for solvency.
Current Liabilities	£2,796	Rising short-term debts ("obligations pressure") increasing from prior years, intensifying liquidity strain.
Average Number of Employees	1	Minimal staff, potentially limiting operational capacity and revenue generation.
Audit Status	Exempt (Micro entity)	Small size limits reporting requirements but also suggests limited scale and resources.

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3. Diagnosis: What the Numbers Reveal

• Cash Flow Distress: Negative net current assets for five consecutive years indicate the company consistently lacks sufficient short-term assets (like cash or receivables) to cover immediate debts. This is akin to a patient with poor circulation—funds are not flowing freely to where they are needed, risking operational paralysis.

• Balance Sheet Weakness: Negative net assets reflect accumulated losses or insufficient equity injections. This "structural deficiency" signals the company is technically insolvent on paper, making it vulnerable to creditor pressure or funding challenges.

• Limited Operational Scale: With only one employee and minimal current assets, the company’s ability to generate revenue or restructure operations rapidly is constrained, limiting recovery options.

• No Audit but Compliance Maintained: While exempt from audit, the company has maintained timely filings with Companies House, indicating compliance with statutory requirements—a positive sign of governance discipline despite financial difficulties.

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4. Recommendations: Steps to Improve Financial Wellness

• Capital Injection or Debt Restructuring: The company urgently needs fresh capital or renegotiation of liabilities to restore positive net assets and ease liquidity constraints. Like stabilizing a patient with intravenous fluids, this financial "lifeline" is crucial.

• Improve Cash Flow Management: Implement stricter credit control, accelerate receivables, and control costs to generate a healthy operational cash flow. Think of this as improving circulation to vital organs.

• Explore Revenue Growth or Diversification: Assess potential for increasing consulting engagements or expanding service offerings to boost income, addressing the root cause of financial weakness.

• Monitor and Manage Working Capital: Regularly track current assets and liabilities to prevent worsening net current asset deficits, akin to monitoring vital signs to preempt crises.

• Consider Professional Advice: Engage financial advisors or turnaround specialists to design and implement a robust recovery plan, as a doctor would recommend specialist treatment for a chronic condition.

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