FOR AGES GAR ANT & FR ` ERES INC. ST A TEMENTS OF C ASH FLOWS 3-month period ended September 30, Y ears ended June 30, 2006 2006 2005 (restated) (restated) $$ $ OPER A TING A CTIVITIES Net earnings ......................................... 815,196 1,082,807 277,769 Items not affecting cash: Amortization of capital assets ........................... 176,927 738,523 734,846 Gain on sale of capital assets ........................... (11,513) (4,022) (56,887) Gain on sale of long-term investments .................... — (5,837) — F uture income taxes ................................. (11,046) 81,550 17,175 969,564 1,893,021 972,903 Changes in non-cash operating working capital items (Note 10) .... (371,850) (566,840) (276,857) 597,714 1,326,181 696,046 INVESTING A CTIVITIES P roceeds from sale of long-term investments ................. — 44,063 — A dvances to the parent company and to a company under common control .................................... (204,500) (159,027) (116,622) A cquisition of capital assets .............................. (13,560) (447,387) (527,682) P roceeds from sale of capital assets ........................ 75,000 4,800 73,500 (143,060) (557,551) (570,804) FINANCING A CTIVITIES Increase (decrease) in bank loan .......................... (2,750,000) — 1,375,000 R epayment of long-term debt ............................ (501,193) (247,875) (254,417) A dvances from directors ................................ (556,273) 10,198 9,989 A dvances from a private trust fund ........................ 3,476,611 — — R epayment of advances from a company under common control . . . — — (700,000) Issuance of shares ..................................... 1,000,000 — — R efundable taxes ..................................... 38,126 (4,004) (2,850) Dividends ........................................... (1,000,000) (98,608) — (292,729) (340,289) 427,722 NET V ARIA TION IN BANK O VERDR AFT .................. 161,925 428,341 552,964 BANK O VERDR AFT , BEGINNING OF PERIOD .............. (320,136) (748,477) (1,301,441) BANK O VERDR AFT , END OF PERIOD .................... (158,211) (320,136) (748,477) A dditional information (Note 10) F-48