The analysis by CPA Australia of almost 16,000 annual reports from listed companies between 2005 and 2013 makes the chilling observation that in 2013 a whopping 11 per cent more listed companies attracted financial distress warnings than during the global financial crisis.

The report, released to Fairfax Media, is based on the findings of independent auditors, who are required to flag in a company's annual report if they believe there is "significant uncertainty" in a company's ability to continue as a going concern.

It comes as iron ore prices fell below $US80 ($90) a tonne, putting a number of smaller high-cost iron ore companies in the financial danger zone. To put it into perspective, two weeks ago iron ore group Desert Resources went into voluntary administration, and if prices stay at these levels or fall further, more companies will fall by the wayside, while others will be forced to intensify cost-cutting strategies and slash jobs.

What is interesting is the big four auditors report a lower percentage of going concern warnings than small audit firms. Whether this reflects the fact that the big four firms audit bigger companies, which are more bulletproof when it comes to a slowdown in the economy, is worth investigating.

The report shows that almost a third of ASX-listed companies attracted "going concern" warnings from independent auditors and that most of the warnings were concentrated in the bottom 500 listed companies.

Put simply, 58 per cent of Australia's smallest 500 listed companies in 2013 attracted going concern warnings by auditors. This is something CPA boss Alex Malley describes as a "sobering reminder of the fragility of the Australian economy and the challenges many businesses face".

When the numbers are further broken down, energy and mining companies stand out like beacons, with more than 40 per cent of these sectors facing serious financial uncertainty. But according to the report, going concern warnings also  increased in sectors including consumer staples, industrials, healthcare and utilities.

The CPA survey of audit reports of listed companies comes against a backdrop of company insolvency blowing out in the three months to June 30, 2014. The quarterly results show a 24 per cent rise in creditor voluntary liquidations, a 28 per cent rise in voluntary administrations and a 16 per cent rise in receiverships. Construction was one of the worst hit industries, with 18 per cent being placed into administration in the latest quarter.

But these official figures are the tip of the iceberg. The brutal reality is there is often a time lag between companies in financial distress and being wound up, given the cost of wind-ups and the few cents in the dollar creditors generally get back.

It suggests an insolvency time bomb could be ticking away in the small- to medium-sized sector, which is a huge concern for the broader economy as SMEs employ 70 per cent of private sector employees.

With this in mind the question raised by Malley becomes all the more concerning when he asks how the Australian economy would cope with another global financial crisis.

"It underscores the simple reality that we have not done enough to fill the void the end of the mining boom is already leaving in our economy or to address the competitiveness challenges that lay ahead for our nation," Malley says.

The impact of the high Australian dollar, the slowdown in China and the outlook for household consumption are all playing roles in the rise in number of going concern warnings since 2011 among the middle to bottom end of the listed company market.

It means there could be an increase in business failures this year, a rise in unemployment and a fall in tax revenue, which will adversely affect the budget deficit.

If there is an upside, it means as long as consumer sentiment remains wobbly and wages growth remains sluggish, the Reserve Bank won't do anything radical.

This is not beyond the realms of possibility, given wages are growing at the slowest rate in more than 15 years. When the inflation rate is thrown in the mix, real wages are going backwards. Until consumers start to feel confident, little will change and surveys like the one released by CPA, which show storm clouds brewing, will prevail.