Company: COOT
Filing Date: 2025-05-30
Form Type: 10-Q
Source: 0001641172-25-013065
Chunk: 10

Company: Australian Oilseeds Holdings Ltd
Filing Date: 2025-05-30
Form: 10-Q
Item: Item 8
Chunk 10
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 derivative instruments to hedge exposures to cash flow, market, or foreign currency risks. The Company evaluates
all of its financial instruments, including issued share purchase warrants, to determine if such instruments are derivatives or contain
features that qualify as embedded derivatives, pursuant to IAS 32 and IFRS 9. The classification of derivative instruments, including
whether such instruments should be recorded as liabilities or as equity, is re-assessed at the end of each reporting period.

The
Company accounts for its 479,000 Private Warrants and 450,000 Representative’s Warrants issued in connection with its Initial Public
Offering as derivative warrant liabilities in accordance with IAS 32 and IFRS 9. Accordingly, the Company recognizes the warrant instruments
as liabilities at fair value and adjusts the instruments to fair value at each reporting period. The liabilities are subject to re-measurement
at each balance sheet date until exercised, and any change in fair value is recognized in the Company’s statements of profit or
loss. The fair value of warrants issued by the Company in connection with the Public Offering and Private Placement has been estimated
using Monte-Carlo simulations at each measurement date.

The
Company accounts for its 458,720 Warrants issued in connection with the issuance of the convertible debenture as derivative warrant liabilities
in accordance with IAS 32 IFRS 9. Accordingly, the Company recognizes the warrant instruments as liabilities at fair value and adjusts
the instruments to fair value at each reporting period. The liabilities are subject to re-measurement at each balance sheet date until
exercised, and any change in fair value is recognized in the Company’s statements of profit or loss.

(l)
Embedded Derivatives

A
derivative embedded in a hybrid contract is separated from the host and accounted for as a separate derivative if, the economic characteristics
and risks are not closely related to the host, a separate instrument with the same terms as the embedded derivative would meet the definition
of a derivative, and the hybrid contract is not measured at fair value through profit or loss. Embedded derivatives are measured at fair
value with changes in fair value recognised in profit or loss. Reassessment only occurs if there is either a change in the terms of the
contract that significantly modifies the cash flows that would otherwise be required or a reclassification of a financial asset out of
the fair value through profit or loss category.

(m)
Segment Reporting

Operating
segments are defined as components of an entity for which separate financial information is available and