Company: NKLR
Filing Date: 2025-11-10
Form Type: S-1
Source: 0001213900-25-108246
Chunk: 262

Company: Terra Innovatum Global N.V.
Filing Date: 2025-11-10
Form: S-1
Chunk 262
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 unobservable.                                                                                                                                      |

<div align='center'>F-43

Terra Innovatum, Srl.
Notes to the Financial Statements</div>

Note 3. Summary of Significant Accounting Policies(cont.)

The Company’s assessment of the significance
of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability.
Financial assets and liabilities are classified in their entirety based on the most stringent level of input that is significant to the
fair value measurement.

The Company’s financial instruments include
cash and cash equivalents, accounts receivable, accounts payable, prepaids, accrued expenses, due from related parties, and note payable — related
party. The recorded carrying amounts of these accounts approximate their fair value due to their short-term nature.

Other Income — Related Party

Other income — related party consists
of engineering consulting services provided to related parties that are unrelated to the Company’s core business. This income is
recognized as the related performance obligations are satisfied. Refer to Note 4. Related Party Transactions for further details.

Segments

ASC Topic 280, Segment Reporting,
establishes standards for companies to report in their financial statement information about operating segments, products, services, geographic
areas, and major customers. Operating segments are defined as components of an enterprise for which separate financial information
is available that is regularly evaluated by the Company’s chief operating decision maker, or group, in deciding how to allocate
resources and assess performance.

For the years ended December 31, 2024
and 2023, the Company was managed as a single operating segment in accordance with the provisions in the Financial Accounting Standards
Board (“FASB”) guidance on segment reporting, which establishes standards for, and requires disclosure of, certain financial
information related to reportable operating segments and geographic regions. Furthermore, the Company determined that a committee comprised
of our Chief Executive Office (“CEO”) and founding officers is the Chief Operating Decision Maker as this committee is responsible
for making decisions regarding the allocation of resources and assessing performance as well as for strategic operational decisions and
managing the organization as a whole.

Development Costs

The Company expenses development costs
as incurred. Development costs consist primarily of personnel costs, including salaries and benefits. The Company incurred $74,736
and $41,344 development costs for the years ended December 31, 2024 and 2023, respectively.

Commitments and Contingencies

The Company may at times be involved in litigation
in the ordinary course of business.