Number of Scots firms failing falls by 34.8% during 2013
The number of Scottish firms failing 2013 fell by 34.8% according to analysis of the latest figures by accountants and business advisers BDO LLP. The latest Accountant in Bankruptcy (AiB) figures show that 824 Scottish companies went bust during 2013 compared with 1264 in 2012. Although the figure is down last year it remains the fourth highest year ever and is still higher than 2009 when the economy was suffering in the early years of the recession."
Bryan Jackson, business restructuring partner with BDO, explained: "The fall in corporate failures reflects a stabilising market and a more understanding and cautious approach by lenders to calling in their debts. There is little benefit for either business owners or lenders to call time on many of the outstanding debts as the levels of recovery will be quite low.
"However, there is a correlation between economic recovery and a rise in corporate insolvencies, with many companies that have struggled through the recession still finding themselves in difficulty. Now is the time for businesses to think ahead and plan for the future – how they can grow and avoid issues typically seen at this stage of the cycle, like over-reach, working capital problems and interest rate increases. Otherwise businesses, particularly those referred to as 'zombie companies', risk becoming casualties of the recovery."
Source - BDO