The number of companies entering external administration has hit a ten-year record high last month, illustrating the mounting pressures on businesses. John Park, senior managing director at FTI Consulting, outlines why and how businesses of all sorts and sizes should be taking sensible precautions.
For the nine-month period from 1 July 2023 to 31 March 2024, the Australian Securities and Investments Commission (ASIC) tracked 7,742 companies entering external administration – a 36% increase on the previous corresponding nine-month period.
During this period, construction and accommodation and food services industries represented the greatest number of company failures, accounting for nearly 28% and 15% of the total.
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