---
title: "Notes payable and debt schedules review"
sidebarTitle: "Debt and notes"
description: "Reviewing the Simmons term loan, development notes, the Saxonwald facility, accrued interest consolidation, and the unused credit line."
icon: "landmark"
---

> **For AI agents:** the complete documentation index is at [llms.txt](/llms.txt). Append `.md` to any page URL for its markdown version.

The reviewer's view of the debt schedules. For the underlying loan detail — customer numbers, loan IDs, rates, and balances — see [Debt schedules](/internal/customers/rackson/debt-schedules).

<Info>
  **Source:** `Rackson_RRS_RCY_Review_Process.docx` sections 21, 27.8, and 43.2.
</Info>

## Simmons Bank term loan

- The client (**Mike**) provides the debt schedule. **PBI does not independently maintain or recalculate the amortization.**
- **PBI's main task each period is to accrue interest**, since loan payments often lag by a month — interest is accrued over the month even though the cash payment follows later.

<Warning>
  For roughly the past two periods, the **principal/interest split actually reflected on the lender's statements has diverged from the split shown on the client's original amortization schedule.** Mike has been updating his schedule to match what the statements actually show, and **PBI reports off the updated, statement-driven schedule — not the original projection.**
</Warning>

<Note>
  As part of the bank reconciliation process, the preparer **records loan payments throughout the month** as she works the bank rec, so the principal/interest split is captured in real time rather than reconstructed at period end.
</Note>

## Development notes

A set of development notes tied to individual new-store openings were **originally structured as a single combined note**, but have since been **split out and tracked as individual notes by store** for visibility — even though they all trace back to one original note number on the trial balance.

<Note>
  On the trial balance this shows up as the **original combined note account alongside a series of individual note accounts** identified by store in the account description — which is what allows the individual notes to be tied back to a specific location.
</Note>

Like the term loan, **several of these individual notes have required manual reclasses between principal and interest** when the lender's actual statement split diverged from the original schedule.

## Saxonwald facility

A separate, **non-bank** financing facility, tracked via a dedicated tracker file the client sends **monthly** — and more frequently mid-period if there is a change, such as an additional draw.

<Note>
  **No payments are currently being made** on this facility. PBI is **only accruing interest, not recording payments**, and reporting is limited to what is on the balance/tracker rather than a detailed amortization build.

  The source recording refers to this as "Saxon Wall" — an auto-transcription artifact of **Saxonwald**.
</Note>

## Accrued interest consolidation

Accrued interest across the **Simmons Bank term loan, the development notes, and the Saxonwald facility** is consolidated by **Betsy** into a **single accrued-interest schedule** each period, pulling from the last three or four periods of activity as needed to true up the running balance.

<Frame caption="Debt schedule tracker, showing the Simmons Bank term loan and development note detail">
  <img src="/images/customers/rackson/review-process/image8.jpg" alt="Rackson debt schedule tracker with Simmons term loan and development notes" />
</Frame>

## Unused credit line

A small number of items — **approximately four**, as of the review — still need to be reviewed relating to an unused credit line.

<Note>
  These sit on the list for the **next quarterly review**, not the current monthly close.
</Note>

## Current portion of long-term debt (GL 27910)

A **reclass off the note payable/debt schedules.** Confirm the current-portion split is **refreshed each period as balances amortize**, rather than left at a prior period's static split.

## Step-by-step checklist

<Steps>
  <Step title="Confirm Mike has sent the current schedules">
    Simmons Bank term loan, development notes, and the Saxonwald tracker. **Roll forward the prior schedule if not.**
  </Step>
  <Step title="Accrue interest for the period">
    On the term loan and development notes, **based on the actual lender statement split** rather than the original amortization schedule if the two have diverged.
  </Step>
  <Step title="Confirm the bank rec entries">
    That loan payments recorded during the month carry the correct principal/interest split.
  </Step>
  <Step title="Update the Saxonwald tracker">
    Update the balance and accrue interest. **Confirm no payments were recorded** unless the client has indicated otherwise.
  </Step>
  <Step title="Consolidate all interest accruals">
    Into the single accrued-interest schedule and tie to the GL.
  </Step>
  <Step title="Carry forward the unused-credit-line items">
    To the next quarterly cycle.
  </Step>
</Steps>

## RCY (Dave's) — loan schedule notes

The loan / "term code" schedule for Dave's is described as **straightforward relative to the RRS debt schedules**. The main things to watch:

<Warning>
  **Day-count timing differences.** Being off by a day or two changes the interest calculation by roughly **eight dollars or more per day**, depending on the balance.
</Warning>

Plus the handful of items still needing review related to the unused credit line, above.

<Note>
  On the close checklist, **Loan Statement Reconciliation & SWAP** is a **WD3** task.
</Note>

## Related

- [Debt schedules](/internal/customers/rackson/debt-schedules) — the consolidated loan detail across both entities
- [RRS utilities and interest workpapers](/internal/customers/rackson/workpapers/rrs-utilities-and-interest) — the 24700 accrued interest and 28015/28020 CONA tracking steps
- [RCY debt and notes workpapers](/internal/customers/rackson/workpapers/rcy-debt-and-notes) — the Simmons and Saxonwald preparer steps