This is a Discussion Issue

A nonprofit organization has a 30-year, 5% mortgage on a existing building. The mortgage requires a $3,000 monthly payment. Their current bookkeeper is preparing financial statements for the board and, in doing so lists the mortgage balance at $287,000 under the current liabilities because the board hopes to be able to pay off the mortgage in full next year. Of the mortgage principle, $20,000 will be paid next year if the organization pays according to the mortgage agreement. The board members call you, their trusted CPA, to advise them on how should they report the mortgage on the balance sheet.

Question:

1. What might be an ethical issue here?

2. What would you recommend, leave as is or change the financial statement.

In addition, there is a 200 word minimum for your initial post.