SELECT A SERVICES LIMITED

Executive Summary

SELECT A SERVICES LIMITED has demonstrated notable improvement in financial health over the past year, turning previous liquidity challenges into modest working capital strength and growing retained earnings. While profitability and equity are on a positive trend, limited cash reserves pose a liquidity risk requiring cautious management. With focused cash flow enhancement and continued operational efficiency, the company is positioned for stable future financial wellness.

SELECT A SERVICES LIMITED - Analysis Report

Company Number: 13710616

Analysis Date: 2025-07-20 17:59 UTC

Financial Health Assessment for SELECT A SERVICES LIMITED

---

1. Financial Health Score: B

Explanation:
The company demonstrates a positive trajectory in financial health with improving net current assets, positive shareholders' funds, and profitability evident from retained earnings growth. However, the low cash balance relative to liabilities and the small scale of assets suggest moderate liquidity constraints and limited buffer against unexpected shocks. Thus, the grade is "B" — indicating generally good health but with room for strengthening liquidity and working capital.

---

2. Key Vital Signs

Metric	2023 (£)	2022 (£)	Interpretation
Cash at Bank	2,324	3,908	Low cash reserves, though slightly reduced, limiting immediate flexibility.
Current Liabilities	1,867	4,664	Significant reduction, indicating improved short-term obligations management.
Net Current Assets	457	(756)	Positive net current assets now, showing improved working capital and liquidity.
Total Assets Less Current Liabilities	1,445	366	Increase indicates strong improvement in asset coverage over short-term debt.
Shareholders' Funds	1,445	366	Growth reflects retained earnings accumulation and equity strengthening.
Retained Earnings	1,345	266	Profitability improved significantly; positive earnings retained in the business.
Fixed Assets	988	1,122	Tangible assets remain stable; slight depreciation consistent with asset aging.

Interpretation of Vital Signs:

• The company has moved from a working capital deficit in 2022 to a modest positive working capital in 2023, which is a symptom of recovering operational efficiency and improved cash management.
• The cash "pulse" is weak but stable — low cash reserves mean the business should be cautious with cash outflows to avoid liquidity distress.
• Equity growth and retained earnings accumulation indicate profitable operations and strengthening net worth, which is a healthy sign for long-term viability.

---

3. Diagnosis: Financial Condition

Using a medical analogy, the company’s financial health has improved from a state of "financial anemia" (negative working capital and low equity) to a "stable condition" with positive net current assets and growing equity. The improvement in current liabilities and retained earnings are symptoms of effective management actions, such as reducing short-term debt and generating profit.

However, the relatively low cash reserves compared to liabilities reveal a "circulatory concern" — the company’s liquidity is still somewhat fragile, meaning it might struggle to cover sudden or unexpected expenses without external support or operational cash flow improvements.

The company is in its early years (incorporated in 2021), so these results are encouraging signs of establishing a sound financial foundation. The absence of audit and abridged accounts filing suggests a small-sized entity, with limited complexity but also less financial buffer.

---

4. Recommendations

To improve financial wellness and secure a healthier "financial pulse," the company should consider:

• Enhance Cash Reserves: Aim to increase cash holdings to cover 3-6 months of operating expenses to avoid liquidity stress. This could involve negotiating better payment terms with customers or suppliers or arranging an overdraft facility as a buffer.
• Strengthen Working Capital Management: Continue reducing short-term liabilities and improve debtor collection cycles to maintain positive net current assets consistently.
• Monitor Fixed Assets Utilization: With tangible assets close to £1,000, ensure they are efficiently used or consider asset disposals if non-essential, to release cash.
• Profit Retention and Reinvestment: Maintain focus on profitability and consider reinvesting retained earnings into growth or liquidity-enhancing activities.
• Regular Financial Reviews: Even with abridged accounts, periodic internal financial reviews can help catch early symptoms of distress and allow timely corrective action.
• Strategic Planning: Given the company operates as an exhibition and fair organiser, consider seasonality and event risks in cash flow forecasting to anticipate downturns and plan accordingly.

---