The financial problems encountered by Australian business through the height of the global financial crisis (GFC) are continuing to feed into corporate insolvency figures, and the latest market downturn – and slump in consumer confidence – is likely to cause its own dynamic.
That is the assessment of specialist company liquidation firm, Dissolve, which has pointed to the fact that the latest Australian Bureau of Statistics corporate insolvency figures (for June) are the second highest on record.
Dissolve chief executive Cliff Sanderson said what was being witnessed was still largely as a result of the GFC and associated fallout, meaning the source of the problem stemmed back to 2008 and 2009.
He identified three factors as being in play – a more aggressive approach by the Australian Taxation Office over the past six months, concerns around director penalties at the close of the financial year, and concerns around a downturn in the building and construction industry.
Sanderson said the inability of companies to pay debts dating back to 2008-09, particularly tax debts, were a factor reflecting the fact that it always took a number of years for such problems to filter through to small companies.
"What we are only just starting to see is a rise caused by more recent economic problems, such as the retail downturn and a specific problem area in Queensland as a result of the floods," he said.
