Under Ind AS 16, if an item of PPE is revalued, how should the revaluation surplus be treated in the statement of cash flows?
A. Deducted from financing activities
B. Shown as cash inflow from operating activities
C. Shown as cash inflow from investing activities
D. It is a non-cash item and does not affect the cash flow statement
Answer: Option D
Solution (By JKSSB Mock Tests)
Revaluation surplus is a non-cash adjustment that affects the carrying amount of the asset and equity, but it does not involve any actual cash flow. Therefore, it is not reflected in the cash flow statement.
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