The Courier & Advertiser (Fife Edition)
Scottish business failures at lowest level since 2008 crash
INSOLVeNCIeS: Report shows a 15% drop in number of firms going under
The number of businesses failing in Scotland fell to an eight-year low last year, according to a new report.
A total of 832 firms became insolvent last year, a drop from 984 in 2016 and the lowest number since 2008 when 803 firms went under.
Administrations, which typically affect larger organisations, fell by 14% in the past 12 months (83 down from 97), according to the report by professional services firm KPMG.
Liquidations fell by 16% last year (749 down from 887).
However, the period from October to December saw a rise in the number of insolvencies (251) compared to the previous quarter (217).
Blair Nimmo, global head of restructuring at KPMG, said: “Although we saw a small rise in insolvencies in the quarter ended 2017 compared to the same period in 2016, this does not necessarily signal a fall in the fortunes of Scottish businesses.
“The figures must be viewed in the context of decreases over a six and 12-month comparison, by 7% and 15% respectively.
“Annually, it is encouraging to see the number of business failures falling to an eight-year low, representing what are relatively normal attrition rates.”
Mr Nimmo noted that other economic indicators are not as positive – with comparatively poor GDP forecasts and a low rate of business births.
“A continuing uncertain political and economic climate means businesses remain cautious, and I do not see this changing in the immediate future,” he added.
“Overall, however, rather than formal insolvency proceedings we continue to be busy, primarily advising SMEs across Scotland on a variety of matters including raising new finance, preparing updated financials, negotiation with creditors, alongside various cost reduction and working capital initiatives.”