TANGLED EMOTIONS COUNSELLING SERVICES LIMITED

Executive Summary

Tangled Emotions Counselling Services Limited is an early-stage micro business with low turnover and recurring losses, but no external liabilities. While it currently operates with minimal financial risk to creditors, its thin equity and weak liquidity suggest limited capacity to absorb financial stress. Credit facilities may be cautiously approved with conditions and require close ongoing monitoring of financial performance and cash flows.

TANGLED EMOTIONS COUNSELLING SERVICES LIMITED - Analysis Report

Company Number: SC682452

Analysis Date: 2025-07-29 20:41 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   Tangled Emotions Counselling Services Limited is a micro-entity with limited financial scale and a short trading history since its incorporation in late 2020. The company has generated modest turnover (£17,198 in 2023) but reported consecutive losses (£2,782 loss in 2023 and £1,657 loss in 2022). Despite this, it has no current liabilities or debts, indicating no pressing external creditor risk. However, the thin equity base (£296 net assets in 2023) and recurring losses suggest a fragile financial position. Credit approval would be conditional on close monitoring of cash flows and business activity, possibly requiring personal guarantees or restrictions on credit limits.

2. Financial Strength:
   The balance sheet shows no fixed assets and minimal current assets (£296 in 2023), with no current or long-term liabilities. Shareholders’ funds have decreased from £580 in 2022 to £296 in 2023, reflecting accumulated losses. Working capital remains positive but very limited. The absence of liabilities is a positive sign, but the low asset base and diminishing net assets highlight weak financial resilience and a lack of capital buffer.

3. Cash Flow Assessment:
   Current assets consist mainly of cash or receivables totaling £296, with no creditors recorded. The company’s micro scale and single employee model limit overheads, but the cost of materials expense exceeds turnover, driving losses. Limited working capital and very low liquidity suggest vulnerability to any unexpected cash demands. The company’s ability to service new credit facilities depends on improving profitability and generating positive cash flow, which currently appears constrained.

4. Monitoring Points:

• Turnover growth and margin improvement to reverse loss-making trend.
• Cash balances and working capital fluctuations to ensure liquidity.
• Cost control measures, particularly material costs relative to revenue.
• Timely filing of accounts and confirmation statements to comply with regulatory requirements.
• Any changes in director or ownership structure that may affect governance or financial control.