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8167.0 - Selected Characteristics of Australian Business, 2011-12 Quality Declaration 
Latest ISSUE Released at 11:30 AM (CANBERRA TIME) 19/09/2013   
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BUSINESS FINANCE


BUSINESS FINANCE SOUGHT

All businesses were asked whether they had sought any debt and/or equity finance during the year ended 30 June 2012. If finance had been sought, the business was also asked to identify the types of finance and the status of finance sought (i.e. whether it had been obtained, not obtained or was still in progress). For the purposes of the Business Characteristics Survey (BCS), debt finance includes any finance the business must repay, and equity finance includes finance provided in exchange for a share in the ownership of the business. Businesses could report more than one type of finance and more than one status.

Business finance sought, by employment size, by type and status(a), 2011-12

0-4 persons
5-19 persons
20-199 persons
200 or more persons
Total
%
%
%
%
%

Businesses that sought debt or equity finance(b)
14.4
22.2
28.6
39.9
18.0
Type of finance sought by businesses(c)(d)
Debt
93.3
89.3
90.6
95.7
91.5
Equity
20.8
26.2
36.2
23.1
24.8
Debt finance that was:(e)
obtained
86.9
88.2
90.7
92.1
87.9
not obtained
6.8
4.9
2.8
1.4
5.5
in progress(f)
8.5
8.6
8.3
7.0
8.5
Equity finance that was:(g)
obtained
^52.3
^58.2
^54.5
62.0
55.1
not obtained
^40.0
^30.8
^39.6
33.2
36.3
in progress(f)
7.8
^11.2
np
5.4
8.8

^ estimate has a relative standard error of 10% to less than 25% and should be used with caution
np not available for publication but included in totals where applicable, unless otherwise indicated
(a) Businesses were asked to identify if they had sought any debt or equity finance and, if so, the type of finance sought and whether it was obtained.
(b) Proportions are of all businesses in each output category.
(c) Proportions are of all businesses that sought finance (either debt or equity) in each output category.
(d) Businesses could identify more than one type of finance and more than one status.
(e) Proportions are of all businesses that sought debt finance in each output category.
(f) As at the end of the reference period, 30 June 2012.
(g) Proportions are of all businesses that sought equity finance in each output category.


Overall, nearly one in five businesses sought debt or equity finance during the reference period (18%). Of these, businesses were most likely to report seeking debt finance (92%). Of those businesses that reported seeking debt finance, 88% reported debt finance that was obtained. In contrast, of those businesses that sought equity finance, over half reported equity finance that was obtained (55%).

Businesses with 0-4 persons employed were the most likely to report that they had debt finance that was not obtained (7%) and equity finance that was not obtained (40%), compared to businesses with 200 or more persons employed (1% and 33% respectively).

Further data relating to business finance sought can be accessed via the Downloads tab.


REASONS FOR SEEKING DEBT OR EQUITY FINANCE

Businesses that sought debt or equity finance during 2011-12 were asked the reasons for seeking finance, regardless of whether the finance was obtained. Businesses were able to provide multiple responses.

Reasons for seeking debt or equity finance, by employment size(a), 2011-12

0-4 persons
5-19 persons
20-199 persons
200 or more persons
Total
%
%
%
%
%

Businesses that sought debt or equity finance(b)
14.4
22.2
28.6
39.9
18.0
Reasons for seeking debt or equity finance(c)(d)
Ensure survival of business
31.9
33.1
26.8
6.5
31.4
Maintain short-term cash flow or liquidity
37.8
43.7
^47.5
^50.4
41.3
Replacement of:
IT hardware
9.7
9.3
15.3
17.5
10.3
other equipment or machinery
31.4
35.3
35.8
^30.8
33.4
Upgrade of:
IT hardware or software
7.9
14.9
14.4
20.7
11.4
other equipment or machinery
14.8
19.8
23.2
^26.9
17.8
Purchase of additional:
IT hardware or software
6.6
9.2
13.2
^23.0
8.6
other equipment or machinery
20.1
24.3
24.9
^30.9
22.4
assets not related to expansion
3.6
9.8
10.2
16.1
6.8
Expand business
13.3
17.3
^31.6
^37.0
17.4
To introduce new or improved goods, services, processes or methods
8.9
15.3
19.2
8.6
12.6
Other reasons businesses sought debt or equity finance
10.9
4.0
3.5
4.1
7.3

^ estimate has a relative standard error of 10% to less than 25% and should be used with caution
(a) Businesses that sought debt or equity finance were asked the reason(s) for seeking finance.
(b) Proportions are of all businesses in each output category.
(c) Proportions are of all businesses that sought finance (either debt or equity) in each output category.
(d) Businesses could identify more than one reason.


Consistent with previous results, for businesses that sought debt or equity finance, the most common reason was to maintain short term cash flow or liquidity (41%). The least common reason for seeking finance was the purchase of additional assets not related to expansion (7%).

Businesses with 200 or more persons employed were the most likely to report seeking finance to maintain short term cash flow or liquidity (50%) and to expand their business (37%). A third of businesses with 5-19 persons employed reported they sought finance to ensure the survival of their business (33%), compared to just over one in 20 large businesses that reported this as a reason they sought finance (6%).

Over half of businesses in the Professional, scientific and technical services industry that sought finance reported that this was in order to maintain short term cash flow or liquidity (57%). Businesses in Transport, postal and warehousing were the least likely to report that this was the reason they sought finance (21%). Businesses in the Information media and telecommunications industry were the most likely to seek finance to expand their business (46%). They were also the most likely to have sought debt or equity finance to ensure the survival of their business (52%) followed by Arts and recreation services (45%).

Innovation-active businesses (16%) were more likely to seek debt or equity finance for the upgrade of IT hardware or software than non innovation-active businesses (3%). Innovation-active businesses (23%) were also more likely to seek debt or equity finance to expand their business than non innovation-active businesses (8%).

Further data relating to reasons for seeking debt or equity finance can be accessed via the Downloads tab.


GOVERNMENT FINANCIAL ASSISTANCE

All businesses were asked whether they received any government financial assistance (excluding tax deductions for normal business expenses) during the year ended 30 June 2012. Government organisations include federal, state/territory and local governments.

Government financial assistance received, by employment size(a)(b), 2011-12

0-4 persons
5-19 persons
20-199 persons
200 or more persons
Total

Estimated number of businesses(c)(d) '000
478
232
63
4
776
Type of government financial assistance(e)
Grants %
3.1
5.9
15.2
25.6
5.0
Ongoing funding %
0.4
1.5
4.8
13.4
1.1
Subsidies %
1.0
3.5
8.8
16.3
2.5
Tax concessions %
1.1
2.1
5.4
21.9
1.8
Rebates %
3.6
10.8
17.5
22.5
7.0
Other government financial assistance received %
-
-
-
0.1
-
Any government financial assistance received %
8.1
20.4
36.3
56.4
14.3
No government financial assistance received %
91.9
79.6
63.7
43.6
85.7

- nil or rounded to zero (including null cells)
(a) Proportions are of all businesses in each output category.
(b) Government includes federal, state/territory and local government.
(c) Estimated number of businesses is at 30 June 2012 and are provided for contextual information only. Refer to Explanatory Notes 20 and 21.
(d) Refer to Explanatory Notes 8 to 11 for the scope, coverage and definition of businesses included in the BCS.
(e) Businesses could identify more than one type of financial assistance.


Overall, 14% of businesses reported that they received some form of Australian government assistance. Rebates were the most commonly reported type of government financial assistance (7%).

The proportion of businesses that received at least one type of government financial assistance increased with each successive employment size range. Although businesses with 0-4 persons employed reported the lowest proportion that received financial assistance (8%), this equates to approximately 38,000 businesses, whereas 56% of businesses with 200 or more persons employed represents approximately 2,000 businesses.

Businesses in Agriculture, forestry and fishing were the most likely to report they received at least one type of government financial assistance (32%). This includes being the most likely to have received rebates (20%) and subsidies (6%). Businesses in Arts and recreation services were the most likely to report they received grants (14%), but the least likely to report they received rebates (1%). Businesses in Health care and social assistance were the most likely to report they received ongoing funding (9%). Businesses in the Financial and insurance services industry were the least likely to report receiving grants (1%), as well as the least likely to report receiving any government financial assistance (4%).

Further data relating to government financial assistance can be accessed via the Downloads tab.


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