TECHSOL LTD

Executive Summary

TECHSOL LTD is currently solvent with positive net assets but exhibits critically low cash reserves and minimal operational scale, indicating fragile financial health. Strengthening liquidity and expanding business activities are essential to improve resilience and support sustainable growth. With prudent cash management and strategic investment, the company can build a stronger financial foundation.

TECHSOL LTD - Analysis Report

Company Number: 12744489

Analysis Date: 2025-07-20 19:15 UTC

Comprehensive Financial Health Assessment for TECHSOL LTD

---

1. Financial Health Score: C

Explanation:
TECHSOL LTD demonstrates a stable but very modest financial position with limited cash reserves and very low liabilities. The company shows small but positive net assets and shareholders’ funds, indicating basic solvency. However, the extremely low cash on hand and very small scale of operations (no employees, low turnover implied) restrict its operational flexibility and growth potential. The score reflects a company that is currently solvent but exhibits early symptoms of financial fragility, requiring careful monitoring and strategic improvement.

---

2. Key Vital Signs

Metric	2024 Value (£)	Interpretation
Cash at bank and in hand	379	Critically low cash reserves; symptom of tight liquidity.
Current Liabilities	29	Minimal short-term debts, manageable but reflects limited activity.
Net Current Assets	350	Positive working capital, indicating ability to cover short-term liabilities.
Net Assets / Shareholders' Funds	350	Low equity base, but positive, showing solvency.
Share Capital	100	Minimal initial capital invested.
Profit & Loss Reserve	250	Some retained earnings show modest profitability or capital injections.
Average Employees	0	No employees, indicating limited operational scale.

Interpretation of Vital Signs:

• The company’s cash "pulse" is weak—current cash reserves are near minimal, which could impair day-to-day ability to meet expenses or invest in opportunities.
• The low current liabilities signal low financial stress, but also potentially very limited business activity.
• Positive net current assets and net assets indicate the company is not insolvent and has a buffer above immediate debts.
• No employees suggest the company is either dormant operationally or reliant on contractors/outsourcing, which can constrain growth.

---

3. Diagnosis

TECHSOL LTD presents a financial profile akin to a patient with a generally stable but fragile constitution. The balance sheet shows positive net assets and working capital, which is the "healthy heartbeat" of solvency and short-term financial stability. However, the drastic decline in cash from £2,158 in 2023 to only £379 in 2024 is a significant symptom of distress in liquidity. Without sufficient "healthy cash flow," the company risks operational strain or inability to meet unexpected expenses.

The absence of employees and minimal share capital suggest the company is in an early stage or operating on a very lean basis, possibly focusing on consultancy or IT services with low overheads. The lack of turnover and profitability data (due to abridged accounts) limits insight into operational viability, but the modest increase in shareholders’ funds implies cautious growth or capital support.

In summary, the company is solvent with manageable liabilities but shows signs of liquidity weakness and very limited operational scale—similar to a patient who is stable but weak and at risk if unexpected financial shocks occur.

---

4. Recommendations

To improve financial wellness and ensure a robust future, TECHSOL LTD should consider the following prescriptions:

• Improve Cash Reserves:

  • Implement more rigorous cash flow management to rebuild cash "reserves," ensuring sufficient liquidity to cover operational costs without strain.
  • Delay non-essential expenditures or seek short-term financing if necessary to stabilize cash flow.

• Increase Operational Scale:

  • Consider recruiting staff or outsourcing to increase capacity and potential revenue generation, thereby strengthening the company’s financial “muscle.”
  • Explore new contracts or market opportunities aligned with IT services to increase turnover.

• Enhance Financial Reporting:

  • Move beyond abridged accounts in future filings to provide fuller transparency to stakeholders and lenders, aiding trust and creditworthiness.

• Capital Injection or Investment:

  • If growth is a goal, a strategic capital injection (equity or debt) could provide the fuel needed for expansion and smoothing of cash flow fluctuations.

• Monitor Liabilities:

  • Maintain strict control over short-term debts to avoid liquidity crunches; keep liabilities well below current assets to preserve positive working capital.

• Engage Financial Advisory:

  • Regular financial health check-ups with experts to monitor symptoms of any distress early and adapt strategies promptly.

---