1,100 Scots firms fold 'but it could be worse'

Research by accountancy giant KPMG showed that there was a total of 1,109 administrations, liquidations and receivership appointments during 2010, compared with 883 a year earlier.

However, the firm said the figures still offered some encouragement for businesses north of the Border.

The number of corporate insolvency appointments in the final quarter of last year fell by 10 per cent compared to the third quarter, and the figure was 3 per cent lower than the same period 12 months earlier.

Further optimism came from a reduction in the number of administration and receivership appointments, which typically affect larger companies. There, the total was down 6 per cent across the year and by 20 per cent year-on-year in the closing months of 2010. Restructuring experts said that while the overall number of business failures was up there were positive signs moving into 2011.

Blair Nimmo, head of restructuring for KPMG in Scotland, said: "These figures must be put in context. During the last three troubled years, insolvency levels have never hit the levels anticipated due to a number of factors including a keen focus on cost and cash control by many management teams and I suspect this will continue for the foreseeable future."

He added: "Many market indicators point to 2011 being a year of growth, with increased activity in the deals market."

Nimmo handled a number of business failures last year, including the administrations of Inverness-based Highland Quality Construction and Prestonpans-based Fords Bakery, as well as the liquidation of Marine Subsea (UK), an Aberdeen-based marine engineering company.