According to the latest Office of National Statistics, the number of companies in insolvency (including those in CVAs, administration and liquidation) has fallen year-on-year.
Between April and June 2014, there were 3,461 company liquidations (of which 2,487 were creditors’ voluntary liquidations.) This reveals a drop of 6.9% since the last quarter and over 15% since the same time last year.
The number of companies in administration has also fallen considerably since the last quarter and year-on-year. Since the first quarter of 2014, administrations have dropped by 19.1% but compared to the same time last year, they’ve dropped by a staggering 34.9%. This could suggest that recent regulations and case law has made administrations less attractive.
Now on to company voluntary arrangements (CVAs). CVA cases have actually stayed the same since last quarter but, not surprisingly, the number of CVAs has fallen compared to the same quarter last year. The figures show there were 142 down from 160, a drop of roughly 11.3%.
The results from the latest insolvency statistics clearly represent a recovering economy, with more and more companies finding ways to stay afloat and access the funding they need. The growing number of alternative finance providers (e.g. peer-to-peer lenders and invoice finance) has not only helped to fund small companies that have been turned away by large lenders, but has boosted confidence within the SME community.