10 per cent rise in number of failing Scots businesses

The first quarter of 2016 has seen the number of failing businesses in Scotland rise by 10 per cent, according to latest figures from KPMG.

The global accountant said there were 206 insolvency appointments between January and March compared to 188 in the same period last year.

Administrations, which typically affect larger organisations, were up 10 per cent from 20 to 22 while liquidations, which tend to hit smaller businesses, rose 9 per cent, from 168 to 184.

But compared with the previous three month period between October and December 2015, total insolvency appointments have fallen by a quarter from 275 to 206.

Similarly, liquidations fell by 23 per cent to 184 and administrations dropped 39 per cent to 22.

Blair Nimmo, head of restructuring for KPMG in the UK, said the figures painted a “confusing ” picture.

He said: “We have to keep these figures in perspective. The number of failing businesses now is still significantly lower than at the height of the recession, but we are beginning to see figures creep back up.

“The oil and gas downturn, coupled with an impending EU referendum and Scottish elections, have created a period of uncertainty, which inevitably results in unfavourable trading conditions.

“Changes to the minimum wage will also put additional pressure on businesses as they seek to implement the new national living wage rate.

“With those challenges in mind, companies need to continue to look at operational consolidation and efficiency improvements in order to avoid stress or distress.”