A growing number of Australian businesses face failure in coming months as the true picture of insolvency emerges from the COVID-19 pandemic.
Data from the year ending June 30 showed an eight per cent annual increase in the number of businesses that had an administrator appointed, Insolvency Australia revealed on Friday.
Director Gareth Gammon said businesses are facing numerous economic pressures including tax obligations.
“We are likely to see a further increase in corporate and personal insolvencies over coming months and into next year,” he said.
“There will be a domino effect, as the pain threshold will be too much for many to bear – particularly (small and medium businesses) whose cash reserves have been exhausted by factors beyond their control.”
During the height of the COVID pandemic there were numerous state and federal government support measures to help business withstand 릴게임사이트 the pinch of lockdowns and 릴게임사이트 travel restrictions.
Most of those benefits have been exhausted.
Across the nation, there were 6555 insolvencies in the latest financial year, which is an increase of 483, or eight per cent, on the previous year.
NSW led the nation with the highest number of business insolvencies.The state recorded 2402 instances of an administrator being appointed, up from 2167 the previous year.
Victoria and the ACT bucked the trend, recording fewer insolvencies in 2021/22 than the previous year.
NSW’s disproportionate insolvency count could be attributed to the high number of businesses being headquartered in the state, CreditorWatch CEO Patrick Coghlan said.
“Businesses need to keep on top of what the presiding risk factors are for businesses over the upcoming years,” he said.
ADMINISTRATORS APPOINTED 2021/22
* NSW 2402
* VICTORIA 1954
* QUEENSLAND 1218
* WESTERN AUSTRALIA 549
* SOUTH AUSTRALIA 227
* ACT 100
* NORTHERN TERRITORY 56
* TASMANIA 49
SOURCE: Insolvency Australia
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