Question

How are the various activities classified as per AS-3 (revised) while preparing a cash flow statement?

Answer 1

As per revised Accounting Standard 3 (AS-3), the preparation of a cash flow statement for each period is mandatory. AS-3 also specifies that all inflows and outflows should be classified primarily under the following categories:

1. Cash flow from operating activities
2. Cash flow from investing activities
3. Cash flow from financing activities