Jack and Jill are working on$,$ respectively, the statement of cash flow for their company. They have heard, however, that changes to IFRS are imminent that will change the how interest and dividends received and paid will be recorded. Jack says dividends paid will be recorded as an operating activity and Jill says dividends paid will be recorded as a financing activity. Who is correct?

Select answer from the options below

both Jack and Jill are correct; the IASB is proposing dividends paid to be recorded as either an operating or financing activity

Jack is correct

Jill is correct

neither Jack nor Jill are correct; the IASB is proposing that dividends paid be recorded as an investing activity