Corporate insolvencies on the rise
Company collapses have risen by 117 per cent to 1,123, reflecting a continuing 'lag effect' from the economic woes of the global financial crisis (GFC), according to research by independent accounting firm Taylor Woodings .
The Australian Securities and Investments Commission's (ASIC's) latest external administration appointment statistics found that corporate collapses increased in all states - with New South Wales up 134 per cent to 453, Queensland up 122 per cent to 273, and Western Australia up 114 per cent to 62.
ASIC also revealed that court ordered wind-ups had surged from 79 to 449, reflecting "increased Australian Taxation Office-led applications from up to a year earlier", Taylor Woodings' 'Insolvency Insights - February 2012' stated.
The analysis paper pointed to negative business confidence and a 0.1 per cent rise in the official unemployment rate (5.2 per cent) as two macro influences on the current rise in insolvencies.
According to ASIC's results, Queensland and Western Australia experience record and near-record highs respectively in relation to corporate insolvencies with Taylor Woodings' report, stating the results indicate the Queensland and Western Australian mining sectors are "drawing 'oxygen' from the non-mining sectors of the economy".
The insolvency analysis paper stated that ASIC's February results are an early indication that the number of insolvency appointments are likely to remain at GFC levels during the 2012 calendar year, with Queensland continuing to experience historically high company collapses.
March figures will be an important indicator for the remainder of the year, as they typically record a marked increase in corporate collapses, Taylor Woodings stated.
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