TCB PROJECTS LIMITED

Executive Summary

TCB PROJECTS LIMITED is facing significant financial challenges characterized by negative equity and severe liquidity issues, reflected by current liabilities far exceeding current assets. Immediate focused actions on cash flow management and debt restructuring are essential to restore financial health and avoid insolvency risks. Without intervention, the company's financial condition may deteriorate further, threatening its ongoing viability.

TCB PROJECTS LIMITED - Analysis Report

Company Number: 13655540

Analysis Date: 2025-07-20 18:17 UTC

Financial Health Assessment for TCB PROJECTS LIMITED as of 31 March 2024

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1. Financial Health Score: D

Explanation:
The company currently shows significant financial distress, indicated by persistent net liabilities and negative shareholders' funds over recent years. The balance sheet reveals a worrying imbalance between current liabilities and current assets, suggesting liquidity issues. While fixed assets remain stable, the inability to cover short-term obligations with liquid assets is a critical concern.

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2. Key Vital Signs

Metric	2024 Value (£)	Interpretation
Fixed Assets	256,783	Stable investment in long-term assets; no growth or impairment noted since 2022.
Current Assets	238	Extremely low liquid assets, insufficient to cover immediate liabilities.
Current Liabilities	425,008	High short-term debts, rising from previous years, signaling pressure to meet near-term obligations.
Net Current Assets (Working Capital)	(424,770)	Severe working capital deficit; a sign of liquidity "symptoms of distress".
Shareholders' Funds (Equity)	(167,987)	Negative equity position, indicating accumulated losses or over-leverage.
Employee Count	2	Small workforce consistent with micro-entity status, limiting operational scale.

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3. Diagnosis: Reading the Financial Symptoms

• Liquidity Crisis: The company's current liabilities vastly exceed current assets, indicating an inability to meet short-term obligations with available liquid resources. This "cash flow distress" is a critical symptom that could lead to insolvency if not addressed.

• Balance Sheet Weakness: Negative shareholders' funds reflect accumulated losses or excessive liabilities relative to assets, signifying that the company is technically insolvent on a net asset basis. This suggests financial strain and reduced buffer against operational or market shocks.

• Asset Stability but Lack of Growth: Fixed assets remain unchanged at £256,783 over three years, showing no new investment or asset impairment. While stable, this also suggests limited expansion or asset enhancement.

• Small Scale Operations: With only two employees, the company operates at a micro-scale, which may limit revenue generation and the ability to improve financial health rapidly.

• No Audit and Limited Disclosure: The accounts are prepared under micro-entity provisions and unaudited, which limits the detail available to fully assess profitability and cash flows. The absence of profit and loss statements restricts deeper insight into operational efficiency.

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4. Recommendations: Treatment Plan for Financial Wellness

1. Immediate Cash Flow Management:

   • Prioritize increasing current assets by collecting receivables faster, reducing inventory if applicable, or injecting cash from owners or lenders to alleviate liquidity strain.
   • Negotiate with creditors for extended payment terms to ease short-term liabilities pressure.

2. Debt Restructuring:

   • Explore refinancing or restructuring current liabilities to convert short-term debts into longer-term obligations, reducing immediate repayment burdens.

3. Capital Injection:

   • Consider capital contributions by shareholders (the two controlling directors) to restore positive equity and improve solvency.

4. Operational Review:

   • Assess business model and cost structures to identify areas for efficiency improvements or revenue enhancement.

5. Financial Reporting Improvement:

   • Move towards audited accounts and fuller financial disclosures for better transparency, facilitating access to finance and stakeholder confidence.

6. Professional Advice:

   • Engage insolvency practitioners or financial advisors early to explore options before liquidity crisis escalates into formal insolvency procedures.

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Medical Analogy Summary

TCB PROJECTS LIMITED is currently exhibiting clear "symptoms of financial distress," primarily a "liquidity deficiency" and "negative net worth," akin to a patient with a weakened heart unable to pump sufficient blood. The company needs urgent "treatment" in the form of cash flow restoration and capital support to stabilize its "vital signs" and avoid progression to a critical "financial failure" state.

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