The downturn in the economy may not be as bad as initially feared according to Big Five firm KPMG.
The firm has based has cited figures indicating receiverships in the first six months of 2001 had only increased 3% compared to the same period last year. The source of KPMG’s figures was business information provider Dun & Bradstreet.
Additionally, KPMG Mandis, the firm’s business advisory arm, has published figures which show a 22% drop in negative announcements by companies.
Mick McLouhglin, corporate recovery partner at KPMG, said: ‘Management are setting more realistic budgets, and are beginning to manage the market’s expectations by issuing fewer profit warnings as key performance indicators are met.’
This statement contrasts with figures revealed by the Department of Trade and Industry, which showed an increase of almost 10% in company insolvencies during the second quarter of 2001, leading many to predict doom and gloom for the economy. And yesterday Office of National Statistics figures suggested that the manufacturing sector is in recession.
A KPMG spokeswoman told AccountancyAge.com the firm was trying to give a different perspective to the current economic debate. She added the firm was ‘not saying that things aren’t bad, but we are saying what is happening right now’.