TRULLI LIVING LIMITED

Executive Summary

TRULLI LIVING LIMITED, a newly formed company, currently exhibits financial stress marked by negative working capital and shareholders' funds due to significant short-term liabilities exceeding current assets. The company's strong fixed asset base is overshadowed by liquidity challenges, requiring focused cash flow management and potential capital injection to stabilize operations. Immediate attention to liquidity and funding will be critical to improve financial wellness and sustain business growth.

TRULLI LIVING LIMITED - Analysis Report

Company Number: 15055125

Analysis Date: 2025-07-20 15:58 UTC

Financial Health Assessment of TRULLI LIVING LIMITED

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1. Financial Health Score: D

Explanation:
TRULLI LIVING LIMITED’s financial position shows signs of distress with negative net current assets and negative shareholders’ funds. While this is not uncommon for a newly incorporated company in its first year, the current financial "vital signs" suggest liquidity strains and a weak equity base, which warrants caution and close management attention.

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2. Key Vital Signs

Metric	Value (£)	Interpretation
Cash at Bank	4,626	Low cash reserves, limited buffer for immediate expenses
Current Liabilities	109,437	High short-term obligations due within one year
Net Current Assets (Working Capital)	-104,811	Negative working capital signals liquidity stress—current liabilities exceed current assets substantially
Fixed Assets (Property)	104,077	Significant investment in tangible fixed assets (freehold property)
Total Assets Less Current Liabilities	-734	Slightly negative net assets after deducting current liabilities
Shareholders' Funds (Equity)	-734	Negative equity indicates accumulated losses or initial funding gap

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3. Diagnosis: What the Numbers Reveal

• Liquidity Symptoms: The company exhibits symptoms of liquidity distress with a low cash balance (£4,626) against high current liabilities (£109,437). The negative net current assets (-£104,811) indicate that the company may struggle to meet short-term obligations without additional financing or improved cash inflows.

• Balance Sheet Structure: The significant fixed asset holding (£104,077) relates to freehold property, suggesting the business is asset-backed but has utilized substantial financing (or creditor funding) to acquire this asset. The negative shareholders' funds (-£734) reflect either startup losses or the timing gap between asset acquisition and revenue generation.

• Early Stage Business Dynamics: Given the company was incorporated in August 2023 and this is the first accounting period ending August 2024, the financial distress signals are typical of early-stage companies investing upfront in assets before generating sufficient operating income.

• Related Party Creditors: A large part of current liabilities (£108,000) is owed to a related party (LLAPSGB Ltd), indicating financing support from connected entities. This may provide some stability but also reflects dependence on related party funding.

• No Audit & Limited Disclosure: The accounts are unaudited and prepared under the small company regime, which limits transparency and detailed financial insight. The absence of an income statement restricts assessment of profitability or cash flow trends.

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4. Recommendations: Actions to Improve Financial Wellness

1. Improve Liquidity Management:

   • Prioritize generating positive cash flow from operations to reduce liquidity strain.
   • Consider negotiating extended payment terms on current liabilities or restructuring creditor arrangements to ease short-term pressure.

2. Capital Injection or Financing Plan:

   • Evaluate the need for additional equity investment or external financing to strengthen the balance sheet and working capital position.
   • Engage with existing related parties or external lenders to secure medium-term funding.

3. Operational Planning:

   • Develop a clear business plan focused on revenue generation from the property letting activities, ensuring rental income or other operating revenues cover ongoing costs.
   • Monitor monthly cash flows closely to anticipate shortfalls and act proactively.

4. Governance and Reporting:

   • Maintain transparent financial reporting and consider voluntary audits or reviews to enhance stakeholder confidence.
   • Keep abreast of filing deadlines to avoid penalties and maintain good compliance standing.

5. Asset Utilization:

   • Leverage the fixed asset (property) to generate income, either through letting or other operational use aligned with the company’s SIC code (68209).
   • Explore opportunities to optimize asset returns or consider partial sale and leaseback if cash constraints intensify.

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Medical Analogy Summary

TRULLI LIVING LIMITED’s financial health shows "symptoms of acute liquidity distress" with a "weak financial pulse" due to negative working capital and equity. While the company’s "asset heart" (property) is strong, the "circulation system" (cash flow and short-term funding) is under strain. Immediate "treatment" (improved cash management and possible capital infusion) is needed to prevent progression to "financial shock" and ensure recovery to a healthier financial state.

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