While these figures are encouraging it doesn’t necessarily paint the whole picture as a lot of  small to medium sized businesses are still finding trading conditions very tough. With a lot of companies just treading water stagnation in the economy seems to be one of the biggest issues facing UK plc.

Stock broker Wills & Co attracted wide media attention after the Financial Services Authority (FSA) clamped-down on the firm and banned it from giving investment advice following accusations of mis-selling.

In October 2007, the FSA fined Wills & Co £49,000 for giving poor risk warnings and misleading information to customers – often inexperienced members of the public – who bought high risk "penny shares".

Since the firm was banned from giving advice, the group ceased trading resulting within the FSA petitioning for a winding up order against the firm.

Last month, the company’s creditors approved its proposal for a CVA resulting within the FSA withdrawing its demand for the closure of Wills & Co.

Tony Murphy, partner at Bridge Company Recovery, said he was confident that the CVA would provide creditors with the maximum repyament.

It is estimated that unsecured creditors are likely to receive 19.1p within the pound returns.

1,771 UK businesses failed during June 2010, 13.4% fewer than in June 2009 when 2,044 firms became insolvent. As a result, the year-on-year insolvency rate fell from 0.10% to 0.09% in June.

At 0.14%, the North East had the highest insolvency rate of the regions in June, with Yorkshire (0.12%) close behind. Businesses in the South West saw a UK low of 0.07%, while Greater London had an insolvency rate of 0.08%

Although these figures are encouraging its vital that businesses remain on their guard as we are not out of the woods yet.

The rate of insolvencies fell to 0.07% in January 2010, with seven in every 10,000 businesses going under. This compares to an insolvency rate of 0.09% in January 2009 and 0.11% in December 2009.

Yorkshire, with 0.13%, witnessed the highest rate of failures in January, while Scotland, the only region to see a year-on-year increase in insolvencies, was beaten by Wales to having the lowest rate of business failures in January (0.06%).

Businesses in Greater London saw the highest year-on-year improvement in their financial health (from 77.85 to 80.02). However, they also had the lowest overall financial strength score of any region.

The highest insolvency rates during January 2010 were among businesses with 11 to 100 employees (0.19%). One to two employee firms had the lowest rate of insolvencies (0.04%)

Well the markets responded with F.T.S.E. 100 down 4.8% by mid-morning, while the France’s Cac 40 lost 5.7%. Germany’s Dax fell 6.1% and earlier in Asia, Japan’s Nikkei closed down 952.58 points, or 9.4%, at 9,203, its lowest finish since June 2003. These drops in the stock market further underline the lack of confidence in the wider economy and while its uncertain how deep the recession will be its clear that a recession is coming very quickly, as identified by the British Chambers of Commerce yesterday.

The lack of commercial finance and liquid cash flow underlines the need for UK Businesses to speaking sooner rather than later with their advisers before business insolvency or creditor pressure is forced upon them.

Enable Finance provide business specialist Business Recovery advice for further information please contact us today