Accounting body CPA Australia says home builders that become insolvent due to external factors should be allowed to continue to trade to avoid setting off a domino effect throughout the industry.
Given the unusual external pressures on the industry thanks in part to global supply chain issues, she said governments should be more pragmatic in their approach to regulation to reduce the knock-on effects for home buyers and other industry players such as subcontracted trades.“You should be able to work with them to limit their licence such that they can complete current builds for the homeowners,” she said.
“Everyone – builders, customers, banks, and governments – at this point in the cycle needs to be doing everything they can to keep builders trading, and trading solvently,” she said. CreditorWatch did not have comparable data on building insolvencies for this year and before the pandemic. Chief economist Anneke Thompson said there was a decline in insolvencies during the pandemic, in part thanks to greater “breathing space” during those two years.
rachelclun Too big to fail 🙄
rachelclun Bit of a reg saying can’t trade while insolvent…… might be a problem….get one of ya mates to sign the audit opinion!
rachelclun will they extend the same consideration to companies in other sectors?
rachelclun So I take it CPA will support a corresponding windfall tax to the industry when time are good then? Also the industry received a preferential treatment in a form of a handout during COVID. Abit rich eh?
rachelclun Isn't that what the US said about housing?
rachelclun Too big to fail eh?
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