Interest cost in cash flow statement.

ABHINAV SHUKLA (CA-Final) (203 Points)

31 May 2016  
Hai. Everyone Pl. Guide me regarding treatment of Interest cost in Cash Flow Statement. my Question is Why interest cost (Expense) is Added back in PAT (in cash flow from Operating Activity) and considered in Financing Activity. because Interest cost is in Expense which is directly related with operation of Business, so why it is considered in financing activity instead of considering in Operating Activity. Pl. Guide, and explain reason behind this. Thanks