Which of the following is not an operating activity-

In a Cash Flow Statement, activities are classified into three categories: Operating, Investing, and Financing Activities.

Operating Activities include cash flows from the principal revenue-generating activities of the enterprise. These are the day-to-day business transactions.

Let's examine each option:

Option 1: Proceeds from long-term borrowings → This is a Financing Activity, not an operating activity. Financing activities relate to changes in the size and composition of equity capital and borrowings of the enterprise.

Option 2: Cash revenue from operations → This is an operating activity as it represents the main cash inflow from business operations.

Option 3: Cash receipt from trade receivables → This is an operating activity. When customers pay their dues, it's part of the normal operating cycle.

Option 4: Employee benefits expenses paid → This is an operating activity. Payments to employees for services rendered are regular operational expenses.

The key distinction is that borrowings (whether short-term or long-term) relate to how the business is financed, while operating activities relate to what the business does on a day-to-day basis to generate revenue.

Therefore, proceeds from long-term borrowings is not an operating activity.