An accountant has commented on the latest insolvency statistics.

Chris Tate, a restructuring and insolvency partner for Azets, shared insights on the company insolvency figures for September.

Last month, company voluntary liquidations made up 80 per cent of all company insolvencies, up 2 per cent from August but 9 per cent lower than September 2023.

Compulsory liquidations were 18 per cent lower than in August and 13 per cent down compared to September 2023.

Administrations rose by 40 per cent from August and were 19 per cent higher than September 2023.

Company voluntary arrangements (CVAs) were 55 per cent higher in September compared to September 2023 but 15 per cent lower than in August.

The construction industry experienced the highest number of insolvencies in the 12 months to August 2024, followed by wholesale and retail trade, accommodation and food services, administrative support services, and manufacturing.

Mr Tate said: "There were 1,973 registered company insolvencies in England and Wales last month [September], slightly up by 2% on August but down 7 per cent compared to September 2023’s 2,130.

"However, the number of company insolvencies remain much higher than during the pandemic, when business life support measures such as the bounce back loan scheme of up to £50,000 were available and interest rates were at a record low.

"Whilst insolvency levels have returned to pre-pandemic levels, the long-tail impacts of previous high inflation, peaking at just over 11 per cent two autumns ago, and the highest in 41 years, with the interest rate staircasing to a 16-year high at one point as the Bank of England tried to dampen the cost of living, resulting in higher borrowing costs on loans, along with hard-pressed households reining in spending, continue to be felt in business.

"We say this time and time again because it is so important – poor cashflow management can easily wreck businesses; if red lights flash on the financial dashboard, get professional advice promptly because turnarounds can happen with the right support."

Azets has offices in Southampton, Portsmouth, Winchester, Romsey, and Havant.