Question: The only long term liability of Range Corporation is a note
The only long-term liability of Range Corporation is a note payable for $1 million secured by a mortgage on the company’s plant and equipment. You have audited the company annually for the three preceding years, during which time the principal amount of the note has remained unchanged. The maturity date is 10 years from the current balance sheet date. You are informed by the president of the company that all interest payments have been made promptly in accordance with the terms of the note. Under these circumstances, what audit work, if any, is necessary with respect to this long-term liability during your present year-end audit?
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