(i) Cash equivalents are short - term , highly liquid investments that are readily convertible into known amount of cash and which are subject to insignificant change in value.(ii) Operating Activities are the principal revenue producing activities or an enterprise and those activities which are not investing or financing activites.(iii)shares issued to promoters in considers in consideration of their services are shown as Financing Activity.(iv)Gratuity paid to a retiring employee is an Operating Activity.(v) Income tax paid is always shown asOperatingActivity.(vi) Dividendpaid is alwaysshown as Financing Activity.(vii) Issue of bonus shares is shown as Financing Activity.(viii)Debentures issued for consideration other than Cash is shown as inflow under Financing Activity.(ix)Depreciation and Amortisation are added to net profit before tax and Extraordinary items ,they being non- cash expense.(x)Preliminary expenses paid during the year are added to net profit before tax and Extra - ordinary items and shown as outflow under Financing Activity.