In keeping the theme from the posts below, as if on cue, I find More companies collapse as economy slows.
Company collapses have risen and the economic slowdown and strong Australian dollar will put further pressure on businesses, an accounting firm says.
Australian Securities and Investments Commission (ASIC) data showed a 6.2 per cent rise in the number of companies that entered into external administration between July 1 last year and April 30, to 7,985, compared with the previous corresponding period.
For the month of April there were 812 company collapses, a fall from March but still 10 per cent higher than in April 2010
Chartered accountants Taylor Woodings said factors hurting businesses included poor retail trade, weak demand for housing and low consumer and business confidence.
A 1.2 per cent fall in gross domestic product (GDP) in the March quarter may prove another negative influence on businesses, Taylor Woodings said in a statement today.
‘‘While the fall in GDP - the worst since 1991 - is being downplayed by many, including the (federal) treasurer (Wayne Swan) as a one-off due to the recent natural disasters, we believe it could signal a rise in corporate insolvencies,’’ the firm said. ‘‘A lag-effect on company collapses could be felt in the short to medium term.’’
The economic slump could also further dampen confidence and ‘‘breed new insolvencies’’, it said
‘‘In addition, we believe the impact of the high Australian dollar on company insolvency rates will continued to be felt, especially in the hospitality, tourism and manufacturing industries.’’