Secured liabilities are at times called mortgage debentures.

The verification procedures are:

i. Obtain a schedule detailing the sums due at the beginning of the year, additions and    redemption/repayments and the sum due at the year end.
ii. Note, or photocopy, for the permanent file the terms and conditions of the loans as evidenced in the debenture.
iii. Agree opening balance with last year’s papers.
iv. Vouch receipt of new loans with prospectus, board minutes, memorandum and articles, register of debenture holders, etc.
v. Vouch repayments with debenture deeds.  (terms are correctly interpreted) cashbook, register of debenture holders etc.
vi. Vouch interest payments with debenture deed, cash book and see amount paid is correctly    shown as a percentage of amount outstanding.
vii. Agree total amount outstanding with register of debenture holder.
viii. If loans are secured, verify charge is registered at companies house.
ix. Verify disclosure is in accordance with Companies Act requirements.  Note that long term loans which are repayable within 12 months of the accounting date must be shown as such.