ASIC’s latest annual insolvency data reveals that more than 11,000 companies entered external administration for the first time in 2023-24. This figure, while slightly higher than previous peaks observed in 2011–12 and 2012–13, represents a smaller proportion relative to the total number of registered companies, which has grown significantly. In 2012, Australia had around two million companies, whereas now there are nearly 3.4 million, making the current ratio of companies entering external administration (0.33%) still lower than the 2012-2013 levels (0.53%).
The overall number of external administrations rose by 39% in 2023–24 compared to the previous year. The top three industries affected were Construction (27%), Accommodation and Food Services (15%), and Other Services (9%), collectively accounting for over half of the total external administrations during this period.
Restructuring appointments saw a dramatic increase of over 200% in 2023–24 compared to 2022–23, now representing 12.9% of all external administrations. This rise can be attributed to the small business restructuring scheme, which allows eligible companies with liabilities under $1 million to retain control of their business while developing a restructuring plan with the help of a restructuring practitioner.
Since the introduction of the small business restructuring process on 1 January 2021, 573 companies have completed their restructuring plans by 30 June 2024. Of these, 89.4% remain registered, 5.4% have gone into liquidation, and 5.2% were deregistered.
ASIC continues to release weekly insolvency statistics to provide insights into the levels of company insolvency in Australia. Additionally, monthly and quarterly updates on the number of practising registered liquidators are also available. As of 30 June 2024, the number of registered liquidators stood at 642, a slight decrease from the previous financial year.
The latest amendments to the statistics were made on 26 July 2024, correcting the figures for ‘Other Services’ from 9.3% to 9% and the growth rate for restructuring appointments from 300% to 200%.
ASIC, Australia’s corporate, markets, and financial services regulator, continues to monitor and report on these trends to provide a comprehensive overview of the business landscape in Australia.
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📉 @asicmedia reports over 11k companies entered administration in 2023-24, with a 39% increase in insolvencies, mainly in construction, accommodation, & food services. 🏗️ Restructuring appts rose 200%, supported by the small biz scheme. 🇦🇺 #TheIndianSunhttps://t.co/DeK2frRRvl
— The Indian Sun (@The_Indian_Sun) July 29, 2024
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