Companies placed in administration in June jumped by 21.1 per cent on a year earlier and are expected to increase further in coming months, accounting firm Taylor Woodings says.
External administration includes companies placed in liquidation, voluntary administration, receivership, wind-ups. In June, they totalled 1027, which was 25.7 per cent higher than in May 2011.
It was the second highest monthly total on record, behind March 2009 during the depths of the global financial crisis.
Total external administrations during 2010-11 were 5.9 per cent higher than a year earlier, and just 1.8 per cent lower than in 2008-09, Taylor Woodings said in a statement, after analysing June insolvency figures provided by the Australian Securities and Investments Commission (ASIC).
The accounting firm attributed the rise to a tough trading environment characterised by a lack of liquidity in debt and equity markets, high interest rates, and continued enforcement activity by the Australian Tax Office (ATO).
More insolvencies were to come, compounded by the adjournment of many ATO-led court wind-up applications that were made in June, Taylor Woodings said.
‘‘There remains a range of pressures on SMEs (small and medium sized enterprises) and company profits and we predict there will likely be an increase in insolvencies in the months ahead.’’
Company collapses in June jumped by 35 per cent in Victoria and 33.1 per cent in NSW compared to May 2011, but improved slightly in Western Australia.
AAP