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- Equally, money advances and loans made by financial institutions are usually classified as operating actions since they relate to the main revenueproducing exercise of that entity.
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Alternatively, the net cash move from working actions may be offered underneath the indirect technique by exhibiting the revenues and bills disclosed within the statement of revenue and loss and the modifications during the interval in inventories and working receivables and payables. Entities are encouraged to report money flows from working actions using the direct technique. Reporting money flows from working actions 18. Therefore, cash flows arising from the purchase and sale of dealing or buying and selling securities are categorised as operating activities. The cash receipts from rents and subsequent gross sales of such property are also money flows from operating actions.
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