What is the difference between a Term Loan and Revolving Credit?
A term loan advances a fixed amount repaid on a set schedule; revolving credit provides a limit that can be drawn, repaid, […]
What is Subordinated Debt?
Subordinated debt sits behind senior debt in the repayment hierarchy, meaning in a default or insolvency, senior lenders are repaid first, and […]
What is Solvency?
Solvency is the ability of a business to meet its financial obligations as they fall due, the threshold between a business that […]
What is Security and Collateral?
Security is the legal claim a lender takes over specific assets to protect its position if the borrower defaults; collateral is the […]
What is Refinancing?
Refinancing is replacing an existing loan with a new one, typically to access better terms, extend the repayment period, consolidate debt, or […]
What is the Personal Property Security Act (PPSA)?
The PPSA is provincial legislation that governs how security interests in personal property, equipment, receivables, and inventory are created, registered, and enforced […]
What is a Personal Guarantee?
A personal guarantee is a commitment by a business owner to repay a corporate debt personally if the business cannot, making the […]
What is an Operating Line of Credit?
An operating line of credit is a revolving facility that allows a business to borrow up to a set limit, repay, and […]
What is the difference between a Compilation, a Review, and an Audit?
These are three levels of accountant engagement for financial statements, each offering progressively more assurance to external users and required in different […]
What is Mezzanine Financing?
Mezzanine financing sits between senior debt and equity in a company’s capital structure, offering more capital than a bank will provide in […]
What is Loan-to-Value (LTV)?
Loan-to-value is the ratio of a loan amount to the appraised value of the asset securing it, a primary measure lenders use […]
What is the Interest Coverage Ratio?
The interest coverage ratio measures how many times operating earnings cover interest expense, a key indicator of whether the business can comfortably […]