WORKWELL CONSULTING SERVICES LIMITED

Executive Summary

Workwell Consulting Services Limited’s recent financials reveal severe weakening with negative net assets and strained liquidity, primarily due to rising short-term liabilities and tax debts. The company’s ability to service debt is compromised, and credit exposure carries significant risk at this time. Close monitoring of cash flow, creditor payments, and profitability is essential going forward.

WORKWELL CONSULTING SERVICES LIMITED - Analysis Report

Company Number: 12732394

Analysis Date: 2025-07-20 18:39 UTC

1. Credit Opinion: DECLINE
   Workwell Consulting Services Limited shows significant deterioration in financial health over the latest year, moving from positive net assets of £8,409 at 31 March 2023 to negative net assets of £-14,771 at 31 March 2024. The current liabilities have increased substantially, mainly driven by a large corporation tax creditor (£20,443), and the company is now in a net current liabilities position of £-15,567. This indicates a weakened ability to meet short-term obligations and service debt. The sharp deterioration in net assets and working capital suggests financial distress and poor liquidity management, which raises concerns on repayment capacity and business resilience. The latest accounts are unaudited and small-company exempt, so less assurance on accuracy. Given these risk factors and lack of profitability indicators, credit approval is not recommended at this time.

2. Financial Strength:
   The balance sheet shows a troubling trend. Fixed assets remain minimal (£796) and stable, but current assets decreased markedly from £31,015 to £16,682 year-on-year, primarily driven by a reduction in trade debtors from £26,245 to £6,217. Cash balances improved from £4,770 to £10,465, yet this is insufficient to offset the increase in current liabilities from £23,621 to £32,249. The large increase in corporation tax creditor and other short-term liabilities has eroded net current assets and shareholders’ funds, which turned deeply negative (£-16,106 in losses). Overall, the balance sheet is weak, with solvency concerns given negative equity and increasing liabilities.

3. Cash Flow Assessment:
   Despite an increase in cash reserves, the company’s working capital management is poor, as indicated by the negative net current assets of £-15,567. The significant build-up of short-term liabilities, especially tax-related and other creditors, suggests cash flow constraints. Trade debtors have fallen sharply, which may signal collection issues or reduced sales. The directors’ loan account balance (£997) is relatively small and unlikely to provide meaningful liquidity support. The company’s cash flow position is strained, and its ability to generate positive operating cash flow to cover debts is questionable.

4. Monitoring Points:

• Corporation tax creditor and other current liabilities: monitor for any payment delays or enforcement actions.
• Trade debtor collections and turnover trends: assess if the decline in debtors is due to reduced sales or improved collections.
• Cash flow forecasts and liquidity ratios: ensure sufficient liquidity to cover short-term obligations.
• Directors’ financial support or capital injections: watch for any related party funding to bolster solvency.
• Profitability and net asset recovery: track if losses reverse and equity improves in subsequent periods.

Executive Summary:
Workwell Consulting Services Limited has experienced a marked deterioration in its financial position during the latest year, leading to negative net assets and strained liquidity. The significant increase in current liabilities, particularly tax obligations, combined with declining working capital raises concerns about its ability to meet obligations and service credit. Given these factors, credit approval is not recommended without substantial mitigation or improvement in financial health.