A code that implements Einstein equations in the characteristic formulation
in 3D has been developed and thoroughly tested for the vacuum case. Here, we
describe how to incorporate matter, in the form of a perfect fluid, into the
code. The extended code has been written and validated in a number of cases. It
is stable and capable of contributing towards an understanding of a number of
problems in black hole astrophysics.Comment: 15 pages + 4 (eps) figure