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Insolvency goes up in Scotland

Category: Scotland Business News — Mark on August 4, 2013

Official figures have shown an increase in the number of companies going to the wall in Scotland in the last quarter.

The information from the Accountant in Bankruptcy (AiB) showed that 184 firms went into liquidation or moved into receivership from April to June.

Despite the increase on Q1 though, the overall trend has shown an impressive decline. Over the quarter, there was a 28 per cent increase in failing businesses. However, when compared to the corresponding point last year, the number actually dropped by 56 per cent.

An industry spokesman said that the rise is nothing to be particularly surprised by, with a number of firms still having to survive on a day-to-day basis. He continued to say:

“For many firms, the long wait for the expected upturn in the economy has not arisen and they have exhausted cash reserves and found themselves falling into insolvency.”

Many are still simply waiting for the economy to turn, rather than taking action to move forward. Other businesses that were struggling have shored up their finances, though. A number have used invoice finance options, such as invoice factoring, in order to provide a growth platform.

There are suggestions that some sectors are improving too, with manufacturing in particular doing well at the moment. Construction and retail are thought to be struggling, though.

However, no matter the business area, firms taking action to manage their finances now will be in a better position to act as improvements continue.

'Disclaimer: The information contained in these articles is of a general nature and no assurance of accuracy can be given. It is not a substitute for specific professional advice in your own circumstances. No action should be taken without consulting the detailed legislation or seeking professional advice. Therefore no responsibility for loss occasioned by any person acting or refraining from action as a consequence of the material can be accepted by the authors or the firm.

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