THE BETTER YOU ACADEMY LIMITED

Executive Summary

THE BETTER YOU ACADEMY LIMITED shows critical financial distress with deep negative net assets and poor liquidity, reflecting an inability to meet short-term obligations. Immediate capital injection and cash flow management are essential to avert insolvency risk and restore financial health. Early intervention and operational efficiency improvements can improve the company's prognosis and sustainability.

THE BETTER YOU ACADEMY LIMITED - Analysis Report

Company Number: 14431870

Analysis Date: 2025-07-20 12:40 UTC

Financial Health Assessment Report for THE BETTER YOU ACADEMY LIMITED

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1. Financial Health Score: Grade D

Explanation:
The company exhibits significant financial distress manifested by deep net liabilities and negative working capital, indicating severe liquidity and solvency issues. The negative shareholders’ funds and net assets reflect accumulated losses and an imbalance in the capital structure. While the company is active and compliant with filings, the financial "vital signs" reveal symptoms of financial strain requiring urgent attention.

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2. Key Vital Signs

Metric	Value (£)	Interpretation
Current Assets (Cash)	225	Extremely low cash reserves ("weak pulse"), insufficient to cover short-term obligations.
Current Liabilities	16,281	High short-term debts relative to assets, indicating immediate financial obligations ("obstruction in cash flow").
Net Current Assets (Working Capital)	-16,056	Negative working capital ("blue light symptom") indicating inability to meet short-term liabilities with available assets.
Net Assets (Total Equity)	-16,056	Negative net assets ("heart failure") showing liabilities exceed total assets, reflecting accumulated losses or undercapitalisation.
Shareholders Funds	-16,156	Deficit in shareholder equity ("structural damage"), implying residual interest holders have negative stake in the company.
Company Age	1 year	Very young company, which may explain early stage financial losses and limited asset base.
Number of Employees	2	Small operational scale consistent with micro/small enterprise, but limited human resources may challenge growth and resilience.
Industry	Sports and recreation education (SIC 85510)	Sector often reliant on cash flow from clients and grants; liquidity is critical for operational continuity.

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3. Diagnosis

THE BETTER YOU ACADEMY LIMITED is in a precarious financial condition akin to a patient with severe malnutrition and dehydration—its financial "organs" (assets) are insufficient to support its "body" (liabilities and operations). The company shows:

• Liquidity crisis: Negative working capital and minimal cash on hand indicate an inability to pay bills or short-term debts as they fall due, posing immediate risk to operational continuity.
• Solvency concerns: Negative net assets suggest the company owes more than it owns, reflecting either initial funding shortfalls or operating losses accumulating since inception.
• Early stage losses: As a company incorporated in late 2022 with a small team, it is common to have initial losses, but the extent here is alarming, highlighting urgent need for financial restructuring or capital injection.
• Risk of distress: If unaddressed, the company could face insolvency procedures such as administration or liquidation, especially if creditors demand repayment.

In summary, while the company complies with filing requirements and is not overdue, its financial "health" is weak with clear signs of distress requiring immediate intervention.

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4. Recommendations

To improve financial wellness and restore healthy financial functioning, THE BETTER YOU ACADEMY LIMITED should consider:

1. Capital Infusion: Seek additional funding from shareholders or external investors to bolster equity and reduce net liabilities — a "blood transfusion" to stabilize the balance sheet.

2. Cash Flow Management: Implement stringent controls on expenditures and accelerate receivables to improve liquidity — restoring a "strong pulse" of cash.

3. Debt Restructuring: Negotiate with creditors to extend payment terms or reduce liabilities, easing immediate financial pressure — akin to reducing "cardiac stress."

4. Operational Review: Examine business model and cost structure to identify efficiency improvements and revenue enhancement opportunities — promoting overall "metabolic health."

5. Monitoring and Reporting: Regularly monitor key financial indicators (cash, working capital, net assets) and prepare forecasts to detect early warning signs — ensuring ongoing "vital signs" surveillance.

6. Professional Advice: Engage financial advisors or insolvency practitioners early to explore all options and avoid crisis — analogous to consulting a specialist for chronic illness management.

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