Press Release: P&A fires warning over worrying trend

A recent fall in the number of businesses being placed into liquidation could actually be bad news for creditors, according to experts in the field.
Birmingham and Coventry-based insolvency firm Poppleton & Appleby has warned that suppliers, landlords and other creditors could be left out of pocket by a worrying new trend.
The firm has analysed recent figures which show struggling small businesses are shutting up shop rather than filing for bankruptcy or placing the company into liquidation and facing the costs of insolvency.
Recent statistics show the number of company failures this year has fallen by around five per cent on the numbers for the previous year.
Andy Turpin, Partner at Poppleton & Appleby, said: “This would appear to be good news but the costs of insolvency is deterring firms from seeking help or entering insolvency proceedings.
“Firms are instead simply ceasing to trade which can leave suppliers and other creditors severely out of pocket – often with serious consequences for their own businesses.
“In many cases we see there would have been the opportunity to save an ailing business if the correct steps and expert advice were taken at an earlier stage.”
According to Turpin the firm, which has offices in Ludgate Hill, Birmingham, and Manor Road, Coventry, has uncovered other potentially disturbing reasons for a fall in the insolvency figures.
“Another reason we are seeing a fall in the number of businesses seeking to begin insolvency proceedings is that owners are waiting until a creditor petitions to wind up the business,” he said.
“In other cases we have seen people holding out by failing to file accounts for many years until a business is struck off the register.
“Both of these approaches effectively postpone the inevitable or mask the real problems and produce insolvency figures which do not tell the whole story.”
ENDS
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