A:  A call back function is a function which you write, but is called by  some other program or module, such as windows.  To create a callback function, you must first declare a function type, the funciton itself, and implement
the function.  In the interface section:

{ In main program interface }

type
  TCallBackFunction = function(s: string): integer;
  CallMe(s: string): integer;

And in the Implementation section:

{ In main program implementation }

procedure TestCallBack(CallBackFunction: TCallBackFunction); far; external 'Other';
{ Note that 'other' is a Dll containing the procedure TestCallBack }

function CallMe(s: PChar): integer;
begin
  { what ever you need to do }
  CallMe := 1; { What ever you need to return }
end;

procedure TForm1.Button1Click(Sender: TObject);
begin
  TestCallBack(CallMe);
end;

Note that in 'Other' you would also declare a function type, and use it
like this:

{ in library Other interface }
type
  TMainFunction = function(s: string): integer;
  TestCallBack(MainFunc: TMainFunction);
{ in library Other implementation }
TestCallBack(MainFunc: TMainFunction);
var
  result: integer;
begin
  result:=MainFunc('test');
end;