CS Executive · Corporate Accounting and Financial Management · Cash Flows
According to Ind AS 7, how does the statement of cash flows classify the cash flows reported for a period?
Cash flows are classified into operating, investing and financing activities. This is the presentation the cash flow standards require, so classifications such as current and non-current, or revenue and capital, are not the prescribed headings.
- ACurrent, non-current and contingent activities
- BOperating, investing and financing activitiesCorrect
- CRevenue, capital and extraordinary activities
- DDirect, indirect and incidental activities
Explanation
The standard text on presentation requires cash flows during the period to be classified by operating, investing and financing activities. The other options use labels that are not the classification prescribed. AS 3 uses the same three-way classification.
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