ASIC’s external administration appointments figures for June 2013
- ASIC figures released this week, revealed 900 companies entered external administration in Australia during June, making it the first time 900 or more companies entered external administration over five consecutive years.
- 974 companies entered external administration in May, which was a record for the month of May.
- So far in 2013, 5,321 companies have entered external administration, a record for the first six months of a year from when statistics commenced in 1999.
- The increase in voluntary administrations indicates:
- That trading businesses with cash flow issues are utilising the various restructuring options available.
- The need to guard directors against the deeming provisions of DPNs, by appointing an administrator/liquidator.
- The increase in creditor wind ups was likely to be with companies where there was no hope of resurrection.
- Business owners have been using equity in homes and money from alternative sources in light of challenging economic conditions, however these sources of funds have been drying up
- We continue to witness a lack of confidence, low finance availability, and a general risk adverse attitude across the economy.
- With the federal election to be held on 7 September, we expect businesses to remain in a holding pattern while awaiting the certainty of an outcome.