Description: Prime Minister Justin Trudeau has said that the time is up and there will be no more extensions for those business who had borrowed money under the Canada Emergency Business Account (CEBA). During the Covid-19 lockdown days, the federal government offered eligible businesses and not-for-profit agencies up to $60,000 in loans to help ride out the decline in business traffic. These organizations took out $48 billion in loans, and after January 18 the loans will start to accumulate interest at a 5% annual rate. Businesses that pay back or refinance their loans by that date are eligible for up to $20,000 of loan forgiveness.

Date:  January 17, 2024

Source:  cbc.ca

 Link: https://www.cbc.ca/news/business/ceba-loan-not-extended-1.7085696

Discussion points:

1) Do you know any small business owners who took advantage of the CEBA program?

2) If you were an accountant advising a small business owner, would you advise them to refinance the CEBA at a financial institution?

3) Section 8.3 of Wiley’s Financial Accounting: Tools for Business Decision Making discusses the concepts associated with notes receivable, including the various terms that are part of the promissory note. Do a little research with your classmates to see what type of standard documentation the Government of Canada required the borrowers of the CEBA to complete.