1.18 Provisions and Contingent Liabilities
A Provision is recognized if, as a result of past event, the Company has a present legal obligation that
is reasonably estimable, and it is probable that an outflow of economic benefits will be required to set¬
tle the present obligation. Provisions are determined by the best estimate of the outflow of economic
benefits required to settle the obligation at the reporting date. Where no reliable estimate can be made,
a disclosure is made as contingent liability. A disclosure for a contingent liability is also made when
there is a possible obligation or a present obligation that may, but probably will not, require an outflow
of resources. Where there is a possible obligation or a present obligation in respect of which the likeli¬
hood of outflow of resources is remote, no provision or disclosure is made.
1.19 Financial Instruments
A financial instrument is any contract that give rise to a financial asset of one entity and a financial
liability or equity of another entity.
Initial Recognition
Financial assets and liabilities are recognized when the Company becomes a party to the contractual
provisions of the instrument. Financial assets and liabilities are initially measured at fair value. Trans¬
action costs that are directly attributable to the acquisition or issue of financial assets and financial
liabilities (other than financial assets and financial liabilities at fair value through profit and loss) are
added to or deducted from the fair value measured on initial recognition of financial asset or financial
liability.
Subsequent Measurement
Financial assets at fair value through other comprehensive income (FVOCI)
Financial assets are measured at fair value through other comprehensive income if these financial
assets are held within a business whose objective is achieved both by collection contractual cash
flows on specified dates to cash flows that are solely payments of principal and interest on the amount
outstanding and selling financial assets.
Financial assets at fair value through Profit and Loss (FVTPL)
Financial assets are measured at fair value through profit and loss unless it is measured at amortized
cost or at fair value through other comprehensive income on initial recognition. The transaction costs
that are directly attributable to the acquisition of financial assets and liabilities at fair value through
profit and loss are immediately recognized in statement of profit and loss.
Financial liabilities
Financial liabilities are classified as measured at amortized cost or Fair Value Through Profit and Loss
Account (FVTPL). A financial liability is classified as at FVTPL if it is classified as held for-trading, or it
is a derivative or it is designated as such on initial recognition. Financial liabilities at FVTPL are mea¬
sured at fair value and net gains and losses, including any interest expense, are recognized in state¬
ment of profit and loss. Other financial liabilities are subsequently measured at amortized cost using
the effective interest method. Interest expense and foreign exchange gains and losses are recognized
in statement of profit and loss. Any gain or loss on derecognition is also recognized in statement of
profit and loss.
1.20 Cash and cash equivalents
For the purpose of presentation in the statement of cash flows, cash and cash equivalents includes
cash on hand, deposits held at call with financial institutions, other short-term, highly liquid investments
with original maturities of three months or less that are readily convertible to known amounts of cash
and which are subject to an insignificant risk of changes in value.
Bank overdrafts and Cash Credit that are repayable on demand and form an integral part of our cash
management are included as a component of cash and cash equivalents for the purpose of the state¬
ment of cash flows.
Cash flow statement
Cash flows are reported using the indirect method, whereby net profit/ (loss) before tax is adjusted for
the effects of transactions of a non-cash nature and any deferrals or accruals of past or future cash re¬
ceipts or payments and item of income or expenses associated with investing or financing cash flows.
The cash flows from regular revenue generating (operating activities), investing and financing activities
of the Company are segregated.
1.21 Research and Development Costs (Product Development):
Research expenditure is recognized as an expense when it is incurred. Development expenditure on
an individual project is recognized as an intangible asset when the Company can demonstrate:
a) The technical feasibility of completing the intangible asset so that the asset will be available for
use or sale.
b) Its intention to complete and its ability and intention to use or sell the product.
c) How the asset will generate future economic benefits.
d) The availability of resources to complete the asset.
e) The ability to measure reliably the expenditure during development.
Expenditure on development which does not meet the criteria for recognition as an intangible asset is
recognized as an expense when it is incurred. Items of property, plant and equipment and acquired In¬
tangible Assets utilized for Research and Development are capitalized and depreciated in accordance
with the policies stated for Property, Plant and Equipment and Intangible Assets.
1.22 Events after reporting date
Where events occurring after the balance sheet date provide evidence of conditions that existed at
the end of the reporting period, the impact of such events is adjusted within the financial statements.
Otherwise, events after the balance sheet date of material size or nature are only disclosed.
1.23 Recent pronouncements:
Ministry of Corporate Affairs (“MCA”) notifies new standards or amendments to the existing standards
under Companies (Indian Accounting Standards) Rules as issued from time to time. For the year end¬
ed March 31,2025, MCA has not notified any new standards or amendments to the existing standards
applicable to the Company.
The accompanying notes are an integral part of these Standalone financial statements.
For Ramasamy Koteswara Rao and Co LLP
Chartered Accountants For and on behalf of Board of Directors of
Firm Registration Number :010396S/S200084 Tierra Agrotech Limited
Sd/- Sd/- Sd/-
Murali Krishna Reddy Telluri Vijay Kumar Deekonda Suryanarayana Simhadri
Partner Wholetime Director & CFO Director
M No. 223022 DIN: 06991267 DIN: 01951750
Sd/- Sd/-
Kishan Dumpeta Kalidindi Anagha Devi
Place: Hyderabad Chief Executive Officer Company Secretary & Compliance Officer
Date: 27-05-2025
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