NOTES TO THE UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
On October 29, 2015, the Company announced a share repurchase program under which the
Company proposed to acquire up to an aggregate of US$2.00 billion of its ordinary shares over the next 24 months in the open market or through privately negotiated transactions, depending on market conditions and in accordance with applicable
rules and regulations. In March 2017, the Company started the share repurchase program by repurchasing 117,419 Class A ordinary shares from the open market and 65,157 repurchased shares were settled during March 2017 for an aggregate purchase
price of US$110.34 million. The repurchased shares were cancelled under Cayman Islands law upon repurchase and the difference between the par value and the repurchase price was debited to retained earnings.
||FAIR VALUE MEASUREMENT |
ASC topic 820 (ASC 820), Fair Value Measurements
and Disclosures, establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows:
Level 1Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets
Level 2Include other inputs that are directly or indirectly observable in the marketplace
Level 3Unobservable inputs which are supported by little or no market activity
ASC 820 describes three main approaches to measuring the fair value of assets and liabilities: (1) market approach; (2) income
approach and (3) cost approach. The market approach uses prices and other relevant information generated from market transactions involving identical or comparable assets or liabilities. The income approach uses valuation techniques to convert
future amounts to a single present value amount. The measurement is based on the value indicated by current market expectations about those future amounts. The cost approach is based on the amount that would currently be required to replace an
Assets and Liabilities Measured or Disclosed at Fair Value
In accordance with ASC 820, the Company measures
available-for-sale investments and trading investments at fair value on a recurring basis. The fair value of time deposits are determined based on the prevailing
interest rates in the market. The fair values of the Companys held-to-maturity investments as disclosed are determined based on the discounted cash flow model
using the discount curve of market interest rates. The fair value of the Companys available-for-sale debt investments and trading investments are measured using
the income approach, based on quoted market interest rates of similar instruments and other significant inputs derived from or corroborated by observable market data. The fair values of the Companys available-for-sale equity investments in the equity securities of publicly listed companies are measured using quoted market prices.
The Company measures certain financial assets, including equity method investments and cost method investments, at fair value on a nonrecurring
basis only if an impairment charge were to be recognized. The Companys non-financial assets, such as intangible assets, goodwill and fixed assets, would be measured at fair value only if they were
determined to be impaired on an other-than-temporary basis.
The fair value of long-term notes payable of RMB33.18 billion (US$4.82
billion) as of March 31, 2017 is disclosed using quoted market price.