The number of company insolvencies in Scotland has risen by more than 45 per cent in six months, according to the latest analysis from KPMG.

Company insolvency statistics in Scotland 2019

According to new analysis from the professional services firm, there were a total of 698 corporate insolvencies in Scotland this year between January and June. This represented a significant jump from 479 insolvencies in Scotland in the previous six months.

KPMG suggest economic volatility is the cause of the rise in insolvency appointments. While it accepts the politics surrounding Brexit has created “a climate of uncertainty” for businesses, it blamed the rise on wider economic volatility, with several retailers among the most high-profile corporate casualties in recent months.

Of the 698 cases in Scotland, 661 involved a company liquidation, while 37 were administration and receivership appointments.

'Signs of resilience'

But despite the rise in cases, Blair Nimmo, head of restructuring for KPMG, also pointed to 'signs of resilience' in the Scottish economy. The number of insolvencies in the quarter ending 30 June 2019 is similar to that of the same period in 2018. KPMG also pointed out that while there was a rise in the number of administrations, the figure remains relatively low when compared to historic data.

On the findings, Nimmo said: “The last quarter has remained far more static, and a number of industries are taking proactive measures to put themselves on a more stable financial footing, including retailers, hoping CVA [company voluntary arrangement] proposals could head off the prospect of administration.

“The ongoing Brexit discussions and change of Prime Minister and Cabinet have undoubtedly created a climate of uncertainty, but there are wider challenges at play, creating a toxic mix of issues for businesses going through a period of distress.”

Advice to businesses in Scotland

Nimmo added that the best approach for businesses in Scotland to prosper in these economic conditions is “to maintain a fiscally cautious approach, ensuring you maximise reserves, proactively and regularly review contingency plans and - ultimately - plan for any worst case scenarios.

"A number of challenges could be on the horizon, but with a resilient, focused approach, including taking appropriate advice at an early stage, Scotland's business community can continue to grow sustainably in the long-term."

See also

Place an insolvency notice

Company insolvency statistics - Q2 2019 (England and Wales)

Company insolvency statistics – Q1 2019 (England and Wales)

Find out more

​KPMG

Accountant in Bankruptcy (Scotland’s Insolvency Service)

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