Even accountants not immune from insolvency
Think accountants, think financial prudence and a safe pair of hands – yes, but accountants are in business just like all the rest of us, and they are not immune to insolvency, nor are lawyers or doctors and dentists.
Publicity to the large number of solicitor practices which have gone to the wall has been limited, but one case of insolvency in accountant practice has been widely reported in the last week because the practice concerned was a top 50 ranked practice in England & Wales.
The practice in question Target Consulting Group had employed around 200 people with a number of offices around the country, with different functions under an umbrella group.
As with many other administrations, whilst jobs will still be lost, there are some attractive assets within the Group and it seems that some have been sold off already, and the accountancy part of the business, as opposed to corporate finance and other divisions has not had to go into administration at all.
The above shows the value of setting up a group structure of companies such that even if parts of a business are insolvent, others that are not can survive. It also shows that running a business is tough, even for those with significant skill on the face of it, professional training and years of experience. Of course it also demonstrates that with any economic downturn on such a broad scale as we are seeing, it will permeate to all levels of society.
In fact, with solicitors, it is quite noticeable that a number of practices are perhaps good at advising others but when it comes to their own business management skills and decision making, this isn’t so great. Maybe that’s why they became solicitors in the first place !
