More than half of the external administrators' reports filed with the Australian Securities and Investment Commission during the 2013/14 financial year, detailing business insolvencies, included allegations of insolvent trading.Allegations of various form of misconduct were rife among the 10,073 reports lodged by liquidators, receivers and voluntary administrators during the year to June. According to ASIC's annual insolvency statistics, in 57 per cent of reports external administrators alleged that there was insolvent trading. In 37 per cent of reports external administrators alleged that the companies did not meet their obligations to keep financial records and in 27 per cent of reports they alleged that directors and officers had failed to exercise care and diligence in carrying out their duties.Insolvency is mainly a problem affecting small business, with 81 per cent of reports concerning companies with fewer than 20 employees. That number is consistent with previous years.Eighty-six percent of failed companies had estimated assets of A$10,000 or less, and 65 per cent had an estimated deficiency of $500,00 or less.Companies in the personal and business services industry accounted for 26 per cent of insolvencies, companies in the construction industry accounted for 23 per cent and companies in the accommodation and food services industries accounted for ten per cent.The causes of failure that administrators nominated most often were inadequate cash flow or high cash use (43 per cent of cases), poor strategic management of the business (37 per cent of cases) and lack of care and diligence (27 per cent of cases).Unsecured creditors don't stand to get much return from a failed business. In 97 per cent of cases administrators estimated that the dividend to creditors would be less than 11 cents in the dollar. This estimate is consistent with previous years.