SPARROWHAWK LIMITED

Executive Summary

SparrowHawk Limited shows sound initial financial health with positive liquidity and solvency indicators typical of a stable micro-entity in its first year. The company's financial "vital signs" are good, though limited by scale and reporting detail. To ensure continued well-being and growth, it is recommended to monitor cash flow closely, build financial buffers, and diversify governance.

SPARROWHAWK LIMITED - Analysis Report

Company Number: 14384689

Analysis Date: 2025-07-29 12:20 UTC

Financial Health Assessment of SparrowHawk Limited

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1. Financial Health Score: B

Explanation:
SparrowHawk Limited demonstrates a sound financial position for a micro-entity in its first full year of operation. The company shows positive net current assets and net equity, indicating a stable foundation. However, the scale of operations is very small, and the financial data is limited, which naturally constrains the assessment. The absence of an audit and limited operating history suggests cautious optimism rather than a robust financial diagnosis.

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2. Key Vital Signs

Vital Sign	Value	Interpretation
Current Assets	£14,653	Healthy cash or near-cash resources relative to size.
Current Liabilities	£7,594	Manageable short-term debts; less than current assets.
Net Current Assets	£7,059	Positive working capital; good liquidity "pulse."
Net Assets (Equity)	£6,861	Indicates the owner’s residual interest after liabilities.
Average Employees	1	Very small operation; low overhead and complexity.
Audit Status	Exempt	Typical for micro-entities; less detailed external scrutiny.
Shareholder Control	75-100% Sophie Hubble	Single controller, simplifying decision-making but concentration risk.

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3. Diagnosis: Financial Condition and Business Health

SparrowHawk Limited, incorporated in 2022 and operating in motion picture production, exhibits the "vital signs" of a small but financially stable business. The positive net current assets indicate the company has more short-term assets than liabilities, a classic sign of healthy liquidity — akin to a patient with a steady heartbeat and clear breathing.

The net assets being positive confirms the company is solvent with some equity cushion. The micro-entity status means reporting requirements are minimal, and while this limits detailed financial insight, it also reflects a low complexity business model with limited financial strain.

The sole director and 100% shareholder, Miss Sophie Hubble, points to a tightly controlled governance structure; this can be beneficial for swift decisions but may also entail risks related to over-dependence on a single individual.

No signs of distress such as overdue filings, excessive liabilities, or negative working capital are evident. However, the company is in its infancy, so the absence of revenue or profit data limits insight into operational performance and cash flow health.

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4. Recommendations: Steps to Enhance Financial Wellness

• Cash Flow Monitoring:
  While liquidity currently appears healthy, the company should implement regular cash flow forecasting to anticipate and manage any future shortfalls or investment needs, ensuring the financial "pulse" remains steady.

• Build Financial Resilience:
  Consider gradually increasing capital reserves or access to credit facilities as a buffer against unexpected expenses or downturns in the motion picture sector.

• Diversify Governance:
  To reduce concentration risk, consider appointing additional directors or advisors. This "medical team" approach can bring diverse perspectives and reduce risks associated with single-person control.

• Prepare for Growth:
  As operations expand, moving beyond micro-entity accounting provisions and potentially commissioning audited accounts will enhance transparency and credibility with investors or partners.

• Strategic Planning:
  Develop a clear business plan with financial projections that include revenue targets and cost controls. This is akin to a long-term health plan for sustained vitality.

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