Company Number: OC432688

Analysis Date: 2025-07-29 13:31 UTC

Financial Health Assessment for YORK CLEANING LLP

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1. Financial Health Score: C

Explanation: YORK CLEANING LLP demonstrates moderate financial health. It maintains positive net current assets and has steady asset values, but persistent long-term liabilities and limited cash reserves suggest caution. The score "C" reflects a company that is stable but showing symptoms of financial strain that require attention to avoid deterioration.

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2. Key Vital Signs

Metric	Latest Value (2024)	Interpretation
Current Assets	£15,601	Reasonable short-term assets, mainly debtors.
Cash at Bank	£1,292	Low cash balance—a symptom of tight liquidity.
Debtors	£14,309	High relative to cash, cash tied up in receivables.
Current Liabilities	£771	Very low short-term liabilities—healthy sign.
Net Current Assets	£14,830	Positive working capital, indicates ability to cover short-term obligations.
Fixed Assets (Tangible)	£36,497	Investment in motor vehicles, a long-term asset.
Long-term Liabilities	£51,327	Significant hire purchase debt related to assets; a burden on cash flow.
Total Assets Less Current Liabilities	£51,327	Reflects net asset position after short-term liabilities.
Net Liabilities Attributable to Members	Nil	No negative equity reported—good structural position.
Employees	3	Small workforce consistent with micro/small business.

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3. Diagnosis

• Liquidity Condition: The company shows a "healthy cash flow" symptom in terms of low current liabilities and positive net current assets, meaning it can meet short-term bills comfortably. However, the cash at bank is low, indicating limited readily available funds.

• Working Capital: Positive net current assets of £14,830 is a good sign, indicating the business has enough liquid assets to cover short-term debts. However, a large portion of current assets is in debtors, suggesting a need to improve receivables collection.

• Leverage and Solvency: The company carries significant long-term liabilities (£51,327) in the form of hire purchase contracts, primarily linked to motor vehicles. This "long-term debt load" is a noteworthy "symptom of distress" if cash flow tightens. Reliance on hire purchase may limit financial flexibility.

• Asset Management: Tangible fixed assets are substantial relative to company size, showing investment in business infrastructure. Depreciation is being properly accounted for, which is a positive.

• Profitability: The absence of a profit and loss account in the filing limits insight into profitability trends. However, steady asset figures and low current liabilities hint at operational stability but possibly modest profitability.

• Governance & Control: Controlled by two designated members with 25-50% voting rights each, indicating balanced control. No red flags on company status or director conduct.

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4. Recommendations

• Improve Cash Reserves: Increase liquid cash on hand to buffer against unexpected expenses. This might involve negotiating better payment terms with clients or delaying non-essential payments.

• Tighten Debtor Management: Accelerate debtor collections to convert receivables into cash faster. Implement stricter credit checks and consider incentives for early payment.

• Review Hire Purchase Debt: Explore refinancing options to reduce interest costs or extend terms to ease cash flow pressures. Alternatively, evaluate whether all fixed assets are essential or if some can be sold to reduce debt.

• Profit & Loss Transparency: Consider preparing and filing detailed profit and loss accounts to provide clearer insight into operational performance. This will help identify cost-saving opportunities.

• Contingency Planning: Establish a financial contingency plan given the relatively high long-term debt. Scenario planning for downturns will help maintain "financial health" under stress.

• Monitor Working Capital: Regularly review working capital metrics to ensure the business remains liquid and can meet obligations without strain.

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Medical Analogy Summary

YORK CLEANING LLP shows signs of a firm with a "stable heartbeat"—positive working capital and manageable current liabilities—but the low cash balance and significant long-term debt are "symptoms" that, if unchecked, could lead to "financial fatigue." Proactive management of liquidity and debt will improve the company's "vital signs" and overall resilience.

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