Update or delete without prior input operation

I am having a bit of a problem this morning with the following code:

C     DVNDNO        CHAIN     PAYABLES       
C                   DOW       NOT %EOF       
C                   READE     PAYABLES       
C                   IF        DREFNO = PREFNO
C                   DELETE    PAYABLES       
C                   UPDATE    PAYABLES       
C                   ELSE                     
C                   READE     PAYABLES       
C                   ENDIF                    
C                   ENDDO                    

I am chaining to the file with no problem and I need to stay within the key
(which is why I am using the reade), I am checking for a specific refno and
if I find it I need to delete it, but the system is complaining that I have
not performed an input operation....I would have thought the reade performed
that, what is the proper way to handle this?