‘A benign economy’ and ‘robust economic environment’ are terms used by
PricewaterhouseCoopers and Deloitte to describe their low rate of growth in the
business recovery arena.
Contrast those statements with the Insolvency Service’s figures, which reveal
growing administrations and company voluntary arrangements over the past 18
months. Replacing the old insolvency regime in 2003, administrations have risen
from 400 per quarter in 2004 to an average of 700 per quarter in 2006.
So why modest growth at the big firms? Are they missing out on the rising
number of businesses entering insolvency proceedings?
Anecdotal evidence points to a lack of big business failures, the likes of a
Rover or Courts, as the main issue affecting the latest Big Four figures, while
smaller business failures are continuing unabated.
‘There was the retail splurge at Christmas, but things have been quiet at the
top end since then,’ says Begbies Traynor senior London partner Nick Hood.
The latest results from PwC, for example, show advisory fee income turnover
growth of 8% to £436m, while its ‘performance improvement consulting’ service
line – while not necessarily focusing on struggling businesses – grew by 18% and
also reflects the move towards more consistent efforts by firms to work
alongside clients consistently.
‘Maybe there’s more advisory work for them to do – that’s the service line to
build,’ says Hood.
And in a move that suggests firms lower down the chain are looking outside of
pure insolvency work, Begbies has also continued to expand its range of
offerings, recently acquiring the corporate finance arm of Jackson Stephen.
But with predictions pointing towards more small and mid-market business
failures in the near future, stronger fee income growth figures should be
expected – outside the Big Four at least.
Three new partners and seven business restructuring advisers have been appointed to the new Preston office
Political and economic uncertainty behind the fall in confidence
Just Racing Services, operating company of the Manor Racing Formula One team has entered administration
Last year 16 oil and gas companies became insolvent, finds Top Ten firm Moore Stephens