The number of Scottish companies entering into formal insolvency has increased in the last quarter.
The Accountant in Bankruptcy received 294 notices of Scottish registered companies becoming insolvent or entering receivership in the fourth quarter of 2010/11. This figure includes 13 receiverships, 199 compulsory liquidations, 82 creditors voluntary liquidations and 56 members voluntary liquidations. The number of companies becoming insolvent or entering receivership during this period was up by 11 per cent over the previous quarter. This marks a four per cent increase on company insolvencies for the same period of last year. By contrast in England the insolvency figures are showing a decrease.
Again, this may be due to the fact that there really is no rescue culture in Scotland. CVA's are not usually considered as there is a presumption against allowing the debtor a second chance and there is a mistaken belief that HMRC in Scotland will not support a CVA. What is more once a winding up petition has been served on a company it is advertised immediately meaning that liquidation is the most likely income.
For more statistics and details insolvency in Scotland and help for Scottish based businesses then please refer to our Scottish rescue page