Document and Entity Information	12 Months Ended
Document and Entity Information	Dec. 31, 2013
Entity Registrant Name	YY Inc.
Entity Central Index Key	0001530238
Document Type	20-F
Document Period End Date	Dec. 31, 2013
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	Yes
Entity Current Reporting Status	Yes
Entity Filer Category	Accelerated Filer
Document Fiscal Year Focus	2013
Document Fiscal Period Focus	FY
Class A common shares
Entity Common Stock, Shares Outstanding	622,658,738
Class B common shares
Entity Common Stock, Shares Outstanding	485,831,386

CONSOLIDATED BALANCE SHEETS In Thousands, unless otherwise specified	Dec. 31, 2013 USD ($)	Dec. 31, 2013 CNY	Dec. 31, 2012 CNY	Dec. 31, 2013 Class A common shares USD ($)	Dec. 31, 2013 Class A common shares CNY	Dec. 31, 2012 Class A common shares CNY	Dec. 31, 2013 Class B common shares USD ($)	Dec. 31, 2013 Class B common shares CNY	Dec. 31, 2012 Class B common shares CNY
Current assets
Cash and cash equivalents	$ 120,521	729,598	504,702
Short-term deposits	236,692	1,432,863	897,698
Accounts receivable, net	16,536	100,101	117,616
Amount due from a related party	12	73	1,073
Prepayments and other current assets	11,156	67,533	25,149
Deferred tax assets	11,055	66,921	31,549
Total current assets	395,972	2,397,089	1,577,787
Non-current assets
Deferred tax assets	103	625	583
Investments	10,246	62,029	2,950
Property and equipment, net	16,954	102,636	90,299
Intangible assets, net	4,811	29,127	19,481
Goodwill	261	1,577	1,604
Other non-current assets	803	4,864	3,485
Total non-current assets	33,178	200,858	118,402
Total assets	429,150	2,597,947	1,696,189
Current liabilities
Accounts payable (including accounts payable of the consolidated variable interest entity without recourse to the Company of RMB27,124 and RMB55,818 as of December 31, 2012 and 2013, respectively)	9,315	56,391	28,149
Deferred revenue (including deferred revenue of the consolidated variable interest entity without recourse to the Company of RMB158,323 and RMB292,380 as of December 31, 2012 and 2013, respectively)	48,543	293,866	159,859
Advances from customers (including advances from customers of the consolidated variable interest entity without recourse to the Company of RMB7,271 and RMB10,656 as of December 31, 2012 and 2013, respectively)	3,229	19,549	7,515
Income taxes payable (including income taxes payable of the consolidated variable interest entity without recourse to the Company of RMB32,885 and RMB47,974 as of December 31, 2012 and 2013, respectively)	12,902	78,107	48,001
Accrued liabilities and other current liabilities(including accrued liabilities and other current liabilities of the consolidated variable interest entity without recourse to the Company of RMB81,223 and RMB197,851 as of December 31, 2012 and 2013, respectively)	41,423	250,760	120,289
Amounts due to related parties (including amounts due to related parties of the consolidated variable interest entity without recourse to the Company of RMB2,604 and RMB2,640 as of December 31, 2012 and 2013, respectively)	436	2,640	2,604
Total current liabilities	115,848	701,313	366,417
Non-current liabilities
Deferred revenue(including deferred revenue of the consolidated variable interest entity without recourse to the Company of RMB4,525 and RMB8,457 as of December 31, 2012 and 2013, respectively)	1,557	9,425	6,487
Total liabilities	117,405	710,738	372,904
Commitments and contingencies
Shareholders' equity
Common shares				6	38	11	6	34	60
Additional paid-in capital	456,847	2,765,614	2,648,404
Statutory reserves	6,716	40,657
Accumulated deficits	(144,490)	(874,697)	(1,311,767)
Accumulated other comprehensive loss	(7,340)	(44,437)	(13,423)
Total shareholders' equity	311,745	1,887,209	1,323,285		38	11		34	60
Total liabilities and shareholders' equity	$ 429,150	2,597,947	1,696,189

CONSOLIDATED BALANCE SHEETS (Parenthetical)(Variable interest entity CNY) In Thousands, except Share data, unless otherwise specified	Dec. 31, 2013	Dec. 31, 2012
Accounts payable	55,818	27,124
Deferred revenue	292,380	158,323
Advances from customers	10,656	7,271
Income taxes payable	47,974	32,885
Accrued liabilities and other current liabilities	197,851	81,223
Amounts due to related parties	2,640	2,604
Deferred revenue	8,457	4,525

Carrying amount as of the balance sheet date of obligations due all related parties. For classified balance sheets, represents the current portion of such liabilities (due within one year or within the normal operating cycle if longer).

+ References+ Details

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE (LOSS) INCOME In Thousands, except Share data, unless otherwise specified	12 Months Ended
	Dec. 31, 2013 USD ($)	Dec. 31, 2013 CNY	Dec. 31, 2012 CNY	Dec. 31, 2011 CNY	Dec. 31, 2013 Online music and entertainment USD ($)	Dec. 31, 2013 Online music and entertainment CNY	Dec. 31, 2012 Online music and entertainment CNY	Dec. 31, 2011 Online music and entertainment CNY	Dec. 31, 2013 Online games USD ($)	Dec. 31, 2013 Online games CNY	Dec. 31, 2012 Online games CNY	Dec. 31, 2011 Online games CNY	Dec. 31, 2013 Others USD ($)	Dec. 31, 2013 Others CNY	Dec. 31, 2012 Others CNY	Dec. 31, 2011 Others CNY	Dec. 31, 2013 Online advertising USD ($)	Dec. 31, 2013 Online advertising CNY	Dec. 31, 2012 Online advertising CNY	Dec. 31, 2011 Online advertising CNY
Net revenues
Total net revenues	$ 301,217	1,823,468	820,031	319,655	$ 140,887	852,885	286,446	52,854	$ 99,462	602,111	332,287	165,933	$ 33,899	205,212	83,655	13,589	$ 26,969	163,260	117,643	87,279
Cost of revenues	(145,696)	(881,999)	(416,133)	(182,699)
Gross profit	155,521	941,469	403,898	136,956
Operating expenses
Research and development expenses	(44,106)	(267,005)	(176,725)	(106,804)
Sales and marketing expenses	(4,122)	(24,955)	(16,954)	(13,381)
General and administrative expenses	(33,129)	(200,554)	(109,788)	(118,241)
Total operating expenses	(81,357)	(492,514)	(303,467)	(238,426)
Other income	4,473	27,078	2,465	1,982
Operating (loss) income	78,637	476,033	102,896	(99,488)
Gain on disposal of an equity investment			651
Gain on disposal of a cost investment			2,351
Foreign currency exchange gains (losses), net	4,882	29,555	(4,153)	14,143
Interest income	9,948	60,221	16,316	4,890
(Loss) income before income tax expenses	93,467	565,809	118,061	(80,455)
Income tax expenses	(14,859)	(89,951)	(29,041)	(1,343)
(Loss) income before share of (loss) income in equity method investments, net of income taxes	78,608	475,858	89,020	(81,798)
Share of (loss) income in equity method investments, net of income taxes	309	1,869	157	(1,358)
Net (loss) income attributable to YY Inc.	78,917	477,727	89,177	(83,156)
(Accretion) decretion to convertible redeemable preferred shares redemption value			1,293,875	(223,663)
Allocation of net income to participating preferred shareholders			(478,754)
Net (loss) income attributable to common shareholders	78,917	477,727	904,298	(306,819)
Net (loss) income	78,917	477,727	89,177	(83,156)
Other comprehensive loss:
Foreign currency translation adjustments, net of nil tax	(5,123)	(31,014)	(1,204)	(11,130)
Comprehensive (loss) income attributable to YY Inc.	$ 73,794	446,713	87,973	(94,286)
Net (loss) income per common share
-Basic (in CNY/dollars per share)	$ 0.07	0.43	1.50	(0.63)
-Diluted (in CNY/dollars per share)	$ 0.07	0.40	0.09	(0.63)
Weighted average number of common shares used in calculating net (loss) income per common share
-Basic (in shares)	1,122,475,688	1,122,475,688	604,703,810	485,883,845
-Diluted (in shares)	1,181,121,297	1,181,121,297	992,468,836	485,883,845

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE (LOSS) INCOME (Parenthetical) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013 Cost of revenues USD ($)	Dec. 31, 2013 Cost of revenues CNY	Dec. 31, 2012 Cost of revenues CNY	Dec. 31, 2011 Cost of revenues CNY	Dec. 31, 2013 Research and development expenses USD ($)	Dec. 31, 2013 Research and development expenses CNY	Dec. 31, 2012 Research and development expenses CNY	Dec. 31, 2011 Research and development expenses CNY	Dec. 31, 2013 Sales and marketing expenses USD ($)	Dec. 31, 2013 Sales and marketing expenses CNY	Dec. 31, 2012 Sales and marketing expenses CNY	Dec. 31, 2011 Sales and marketing expenses CNY	Dec. 31, 2013 General and administrative expenses USD ($)	Dec. 31, 2013 General and administrative expenses CNY	Dec. 31, 2012 General and administrative expenses CNY	Dec. 31, 2011 General and administrative expenses CNY
Cost of revenues
Share-based compensation	$ 1,629	9,860	8,407	15,449	$ 6,539	39,587	35,441	31,672	$ 218	1,318	884	1,336	$ 10,957	66,331	55,619	86,544

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' (DEFICITS) EQUITY In Thousands, except Share data, unless otherwise specified	Total USD ($)	Total CNY	Series A convertible redeemable preferred shares CNY	Series B convertible redeemable preferred shares CNY	Series C convertible redeemable preferred shares CNY	CEO and Chairman CNY	Common shares CNY	Additional paid-in capital CNY	Additional paid-in capital Series A convertible redeemable preferred shares CNY	Additional paid-in capital Series B convertible redeemable preferred shares CNY	Additional paid-in capital Series C convertible redeemable preferred shares CNY	Additional paid-in capital CEO and Chairman CNY	Statutory reserves CNY	Accumulated deficits CNY	Accumulated deficits Series A convertible redeemable preferred shares CNY	Accumulated deficits Series B convertible redeemable preferred shares CNY	Accumulated deficits Series C convertible redeemable preferred shares CNY	Accumulated other comprehensive loss CNY	Class A common shares CNY	Class B common shares CNY	Class B common shares Series A convertible redeemable preferred shares CNY	Class B common shares Series B convertible redeemable preferred shares CNY	Class B common shares Series C convertible redeemable preferred shares CNY
Balance at Dec. 31, 2010		(2,351,505)					32							(2,350,448)				(1,089)
Balance (in shares) at Dec. 31, 2010							466,630,266
Increase (decrease) in shareholders' (deficits) equity
Issuance of common shares		328,132					3	328,129
Issuance of common shares (in shares)							51,140,432
Issuance of common shares for exercised share options		11,701
Exercise of warrant by an independent institutional investor		160,837					2	160,835
Exercise of warrant by an independent institutional investor (in shares)							25,570,216
Share-based compensation-share options		2,219						2,219
Share based compensation-restricted shares		57,805				14,143		57,805				14,143
Share based compensation-restricted share units		9,644						9,644
Share-based compensation-warrants to NeoTasks founders		3,359						3,359
Transferred from matured liability award for NeoTasks founders		57,692						57,692
Reclassification of liability-classified share-based awards into equity-classified awards for warrants to NeoTasks founders		57,602						57,602
Reclassification of liability-classified share-based awards into equity-classified awards for share options		116,328						116,328
(Accretion) decretion of convertible redeemable preferred shares to their redemption value			(88,261)	(64,102)	(71,300)				(88,261)	(64,102)	(71,300)
Appropriations to statutory reserves		0
Components of comprehensive income (loss)
Net (loss) income		(83,156)												(83,156)
Foreign currency translation adjustment, net of nil tax		(11,130)																(11,130)
Balance at Dec. 31, 2011		(1,861,693)					37	584,093						(2,433,604)				(12,219)		37
Balance (in shares) at Dec. 31, 2011							543,340,914													543,340,914
Increase (decrease) in shareholders' (deficits) equity
Issuance of common shares		515,720						515,709											11
Issuance of common shares (in shares)																			179,400,000
Issuance of common shares for vested restricted shares and restricted share units (in shares)																				5,068,000
Share-based compensation-share options		(89)						(89)
Share based compensation-restricted shares		36,371				9,624		36,371				9,624
Share based compensation-restricted share units		54,445						54,445
Transferred from convertible redeemable preferred shares upon the completion of the initial public offering			449,496	337,116	400,447				449,487	337,110	400,439										9	6	8
Transferred from convertible redeemable preferred shares upon the completion of the initial public offering (in shares)																					136,100,930	102,073,860	121,249,520
(Accretion) decretion of convertible redeemable preferred shares to their redemption value			485,517	366,785	441,573				125,813	64,102	71,300				359,704	302,683	370,273
Appropriations to statutory reserves		0
Components of comprehensive income (loss)
Net (loss) income		89,177												89,177
Foreign currency translation adjustment, net of nil tax		(1,204)																(1,204)
Balance at Dec. 31, 2012		1,323,285						2,648,404						(1,311,767)				(13,423)	11	60
Balance (in shares) at Dec. 31, 2012																			179,400,000	907,833,224
Increase (decrease) in shareholders' (deficits) equity
Issuance of common shares for exercised share options		115						115
Issuance of common shares for exercised share options (in shares)																			4,648,420
Issuance of common shares for vested restricted shares and restricted share units								(1)											1
Issuance of common shares for vested restricted shares and restricted share units (in shares)																			16,608,480
Class B common shares converted to Class A common shares																			26	(26)
Class B common shares converted to Class A common shares (in shares)																			422,001,838	(422,001,838)
Share-based compensation-share options		14,004						14,004
Share based compensation-restricted shares		7,300						7,300
Share based compensation-restricted share units		95,792						95,792
Appropriations to statutory reserves		40,657											40,657	(40,657)
Components of comprehensive income (loss)
Net (loss) income	78,917	477,727												477,727
Foreign currency translation adjustment, net of nil tax		(31,014)																(31,014)
Balance at Dec. 31, 2013	$ 311,745	1,887,209						2,765,614					40,657	(874,697)				(44,437)	38	34
Balance (in shares) at Dec. 31, 2013																			622,658,738	485,831,386

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' (DEFICITS) EQUITY (Parenthetical) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013 USD ($)	Dec. 31, 2013 CNY	Dec. 31, 2012 CNY	Dec. 31, 2011 CNY
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' (DEFICITS) EQUITY
Foreign currency translation adjustments, tax portion	$ 0	0	0	0

CONSOLIDATED STATEMENTS OF CASH FLOWS In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013 USD ($)	Dec. 31, 2013 CNY	Dec. 31, 2012 CNY	Dec. 31, 2011 CNY
Cash flows from operating activities
Net (loss) income	$ 78,917	477,727	89,177	(83,156)
Adjustments to reconcile net (loss) income to net cash provided by operating activities
Depreciation of property and equipment	7,427	44,963	29,074	12,888
Amortization of acquired intangible assets	777	4,707	3,369	1,211
Allowance for doubtful accounts	5,284	31,987	6,884
(Gain) loss on disposal of property and equipment		1	7	(25)
Impairment of equity investments	148	899
Impairment of cost investments			453	1,898
Impairment of intangible assets			550
Share-based compensation	19,343	117,096	100,351	135,001
Share of (loss) income in equity method investments	(309)	(1,869)	(157)	1,358
Gain on disposal of an equity investment			(651)
Gain on disposal of a cost investment			(2,351)
Deferred income taxes, net	(5,850)	(35,414)	(19,316)	(11,173)
Foreign exchange losses (gains), net	(4,882)	(29,555)	4,153	(14,143)
Changes in operating assets and liabilities, net
Accounts receivable	(2,391)	(14,472)	(77,478)	(21,275)
Prepayments and other current and non-current assets	(7,702)	(46,624)	(11,968)	(4,710)
Amounts due from related parties			(73)
Amounts due to related parties	6	36	1,734	(344)
Accounts payable	4,351	26,342	7,214	11,196
Deferred revenue	22,622	136,945	125,541	23,369
Advances from customers	1,988	12,034	5,062	1,712
Income tax payable	4,973	30,106	31,129	12,516
Accrued liabilities and other current liabilities	22,509	136,264	64,148	33,494
Net cash provided by operating activities	147,211	891,173	356,852	99,817
Cash flows from investing activities
Placements of short-term deposits	(252,588)	(1,529,090)	(1,040,302)	(872,372)
Maturities of short-term deposits	164,527	995,996	615,259	399,717
Purchase of property and equipment	(9,185)	(55,606)	(60,881)	(46,956)
Purchase of intangible assets	(2,417)	(14,631)	(1,920)	(274)
Cash paid for equity investments	(1,817)	(11,000)	(1,000)	(4,500)
Cash paid for cost investments	(7,782)	(47,110)		(1,000)
Cash received from disposal of a cost investment	495	3,000	1,000
Cash received from disposal of an equity investment			2,000
Consideration paid in connection with business acquisition			(11,722)
Loan to a related party			(1,200)	(500)
Loan to a third party				(300)
Repayment of loan from related parties	165	1,000	2,500
Loans to employees	(623)	(3,770)	(2,930)	(2,770)
Repayment of loans from employees	258	1,560	660	197
Proceeds from disposal of property and equipment	8	48	32	401
Net cash used in investing activities	(108,959)	(659,603)	(498,504)	(528,357)
Cash flows from financing activities
Proceeds from issuance of common shares, net of issuance costs				488,969
Proceeds from exercise of vested share options	19	115
Proceeds from initial public offering (net of underwriters' commissions of US$ 6,593)			550,555
Payments of listing expenses	(958)	(5,802)	(27,815)
Repurchase of share options				(11,087)
Net cash provided by (used in) financing activities	(939)	(5,687)	522,740	477,882
Net increase in cash and cash equivalents	37,313	225,883	381,088	49,342
Cash and cash equivalents at the beginning of the year	83,371	504,702	128,891	83,683
Effect of exchange rate changes on cash and cash equivalents	(163)	(987)	(5,277)	(4,134)
Cash and cash equivalents at the end of the year	120,521	729,598	504,702	128,891
Supplemental disclosure of cash flows information:
-Acquisition of property and equipment in form of accounts payable	1,264	7,653	5,911	1,090
-Income taxes paid	$ (15,736)	(95,259)	(17,228)

Organization and principal activities

12 Months Ended

Dec. 31, 2013

Organization and principal activities

Organization and principal activities

1. Organization and principal activities

(a) Principal activities

YY Inc. (the "Company"), through its subsidiaries, its variable interest entities ("VIEs") and VIE's subsidiary (collectively, the "Group") is principally engaged in operating an online social platform in the People's Republic of China (the "PRC" or "China") through its platform, YY Client and through its website YY.com and Duowan.com.

(b) Reorganization

The Company was incorporated in the Cayman Islands on July 22, 2011.

The Group began its operations in the PRC in April 2005 through its PRC domestic company, Guangzhou Huaduo Network Technology Company Limited ("Guangzhou Huaduo"), which was directly owned by Mr. David Xueling Li (the "Founder" or the "CEO") and Mr. Jun Lei (the "Co-founder" or the "Chairman"). Guangzhou Huaduo holds the necessary licenses and approvals to operate internet-related businesses in the PRC.

For the period between July 2006 and April 2007, the Group undertook a reorganization (the "First Reorganization") and established Duowan Limited ("Duowan Limited"), an investment holding company under the laws of the BVI, Duowan (Hong Kong) Limited ("Duowan (Hong Kong)"), a Hong Kong incorporated company wholly owned by Duowan Limited, and Guangzhou Duowan Information Technology Co., Ltd. ("Guangzhou Duowan"), a wholly-owned foreign enterprise ("WOFE") in the PRC owned by Duowan (Hong Kong) (collectively "Duowan Limited Group Structure"). The First Reorganization was necessary to comply with PRC laws and regulations which prohibit or restrict foreign ownership of companies that provide internet content services in the PRC where licenses are required.

By entering into a series of agreements among the Founder, the Co-founder, Guangzhou Huaduo, and Guangzhou Duowan (collectively, "First VIE agreements"), Guangzhou Huaduo became a VIE of Guangzhou Duowan. Guangzhou Duowan became the primary beneficiary of Guangzhou Huaduo.

In November 2007, Duowan Entertainment Corporation ("Duowan BVI") was incorporated in the British Virgin Islands. In March 2008, Duowan BVI established Duowan Entertainment Information Technology (Beijing) Company Limited ("Duowan Entertainment"), as a WOFE in the PRC and a wholly-owned subsidiary of Duowan BVI. The Group undertook a second reorganization (the "Second Reorganization") whereby the First VIE agreements among the Founder, the Co-founder, Guangzhou Huaduo and Guangzhou Duowan were terminated and a new series of VIE agreements (collectively, "Second VIE agreements") were signed among the Founder, the Co-founder, Guangzhou Huaduo and Duowan Entertainment, through which Duowan Entertainment became the primary beneficiary and exercised effective control over the operations of Guangzhou Huaduo. Duowan BVI became the then holding company of the Group.

In August 2008, Duowan Entertainment purchased all the equity interests in Guangzhou Duowan from Duowan (Hong Kong).

In December 2008, the Group undertook another reorganization (the "Third Reorganization") and acquired all of the equity interests of NeoTasks Inc. ("NeoTasks"), a Cayman Islands company, together with its wholly-owned subsidiary, NeoTasks Limited, its WOFE, NeoTasks International Media Technology (Beijing) Co., Ltd. ("NeoTasks Beijing"), and its VIE, Beijing Tuda Science and Technology Co., Limited ("Beijing Tuda").

In July 2009, Guangzhou Duowan was renamed as Zhuhai Duowan Information Technology Co., Ltd. ("Zhuhai Duowan").

In December 2009, another series of VIE agreements (collectively, "Third VIE agreements") were entered into amongst the legal shareholders of Beijing Tuda and Duowan Entertainment and thus completing the Third Reorganization. Through the aforementioned activities, Beijing Tuda became a VIE, whose primary beneficiary is Duowan Entertainment.

In December 2010, Duowan BVI established Zhuhai Duowan Technology Company Limited ("Zhuhai Duowan Technology"), which is directly 100% owned by Duowan BVI.

On September 6, 2011, pursuant to a share swap agreement, all the then existing shareholders of Duowan BVI exchanged their respective shares, including the Series A, Series B, Series C-1 and Series C-2 Preferred Shares, of Duowan BVI for equivalent classes of shares of the Company on a 1 for 1 basis. As a result, Duowan BVI became a wholly-owned subsidiary of the Company and it also became the holding company of the Group (the "Share Swap").

In May 2012, Duowan Entertainment was renamed as Huanju Shidai Technology (Beijing) Company Limited ("Beijing Huanju Shidai").

In September 2012, Zhuhai Duowan Technology was renamed as Guangzhou Huanju Shidai Information Technology Company Limited ("Guangzhou Huanju Shidai").

The First Reorganization, the Second Reorganization, the Third Reorganization and the Share Swap were all reorganization of entities under common control and have been accounted for in a manner akin to a pooling of interest as if the Company, through its wholly owned subsidiaries, had been in existence and been the primary beneficiary of the VIEs throughout the periods presented in the consolidated financial statements. As a result of these arrangements, the Company, through its wholly owned subsidiaries, is considered the primary beneficiary of two VIEs, Guangzhou Huaduo and Beijing Tuda, and accordingly, their results of operation and financial conditions are consolidated in the financial statements of the Group.

(c) Initial Public Offering

The Company completed its initial public offering ("IPO") on November 21, 2012 on the NASDAQ Global Market and the underwriters subsequently exercised their over-allotment option on December 5, 2012. The Company issued and sold a total of 8,970,000 American Depositary Shares ("ADSs") in these transactions, representing 179,400,000 Class A common shares. Each ADS represents twenty Class A common shares. The net proceeds received by the Company, after deducting commissions and offering expenses, amounted to approximately US$82,055. Upon the completion of the IPO, all of the Company's 359,424,310 outstanding preferred shares and 548,408,914 outstanding common shares were converted into Class B common shares immediately as of the same date.

(d) Subsidiaries, VIEs and VIE's subsidiary

The details of the subsidiaries, VIEs and VIE's subsidiary as of December 31, 2013 are set out below:

Name	Place of incorporation	Date of incorporation		Principal activities

Subsidiaries
Duowan Entertainment Corporation ("Duowan BVI")	British Virgin Islands	November 6, 2007	100%	Investment holding
NeoTasks Inc. ("NeoTasks")	Cayman Islands	April 26, 2006	100%	Investment holding
NeoTasks Limited	Hong Kong	June 16, 2005	100%	Investment holding
Huanju Shidai Technology (Beijing) Company Limited ("Beijing Huanju Shidai" or "Duowan Entertainment")	PRC	March 19, 2008	100%	Investment holding
Zhuhai Duowan Information Technology Company Limited ("Zhuhai Duowan" or "Guangzhou Duowan")	PRC	April 9, 2007	100%	Online advertising and software development
Guangzhou Huanju Shidai Information Technology Company Limited ("Guangzhou Huanju Shidai")	PRC	December 2, 2010	100%	Software development
Zhuhai Huanju Shidai Information Technology Company Limited ("Zhuhai Huanju Shidai")	PRC	November 14, 2013	100%	Software development
Variable Interest Entities ("VIEs")
Guangzhou Huaduo Network Technology Company Limited ("Guangzhou Huaduo")	PRC	April 11, 2005	100%	Holder of internet content provider licenses and internet value added services
Beijing Tuda Science and Technology Company Limited ("Beijing Tuda")	PRC	June 2, 2005	100%	Holder of internet content provider licenses
VIE's Subsidiary
Guangzhou Juhui Information Technology Company Limited	PRC	October 24, 2013	100%	Software development

(e) Variable Interest Entities

To comply with PRC laws and regulations that prohibit or restrict foreign ownership of companies that provide internet-content, the Group conducts substantially all its operations through Guangzhou Huaduo and Beijing Tuda, which holds the internet value-added service license and approvals to provide such internet services in the PRC. Beijing Huanju Shidai entered into a series of contractual agreements among Beijing Huanju Shidai, Guangzhou Huaduo and their legal shareholders. Beijing Huanju Shidai also entered into a series of contractual agreements among Beijing Huanju Shidai, Beijing Tuda, and Beijing Tuda's legal shareholders.

Guangzhou Huaduo

The Company's relationships with Guangzhou Huaduo and its shareholders are governed by the following contractual arrangements:

•

Exclusive Technology Support and Technology Services Agreement

Under the exclusive technology support and technology services agreement between Beijing Huanju Shidai and Guangzhou Huaduo, Beijing Huanju Shidai has the exclusive right to provide to Guangzhou Huaduo technology support and technology services related to all technologies needed for its business. Beijing Huanju Shidai owns the exclusive intellectual property rights created as a result of the performance of this agreement. The service fee payable by Guangzhou Huaduo to Beijing Huanju Shidai is determined by various factors, including the expenses Beijing Huanju Shidai incurs for providing such services and Guangzhou Huaduo's revenues. The term of this agreement will expire in 2028 and may be extended with Beijing Huanju Shidai's written confirmation prior to the expiration date. Beijing Huanju Shidai is entitled to terminate the agreement at any time by providing 30 days' prior written notice to Guangzhou Huaduo.

•

Exclusive Business Cooperation Agreement

Under the exclusive business cooperation agreement between Beijing Huanju Shidai and Guangzhou Huaduo, Beijing Huanju Shidai has the exclusive right to provide to Guangzhou Huaduo technology support, business support and consulting services related to the services provided by Guangzhou Huaduo, the scope of which is to be determined by Beijing Huanju Shidai from time to time. Beijing Huanju Shidai owns the exclusive intellectual property rights created as a result of the performance of this agreement. The service fee payable by Guangzhou Huaduo to Beijing Huanju Shidai is a certain percentage of its earnings. The term of this agreement will expire in 2039 and may be extended with Beijing Huanju Shidai's written confirmation prior to the expiration date. Beijing Huanju Shidai is entitled to terminate the agreement at any time by providing 30 days' prior written notice to Guangzhou Huaduo.

•

Exclusive Option Agreement

The parties to the exclusive option agreement are Beijing Huanju Shidai, Guangzhou Huaduo and each of the shareholders of Guangzhou Huaduo. Under the exclusive option agreement, each of the shareholders of Guangzhou Huaduo irrevocably granted Beijing Huanju Shidai or its designated representative(s) an exclusive option to purchase, to the extent permitted under PRC law, all or part of his or its equity interests in Guangzhou Huaduo. Beijing Huanju Shidai or its designated representative(s) have sole discretion as to when to exercise such options, either in part or in full. Without Beijing Huanju Shidai's prior written consent, Guangzhou Huaduo's shareholders shall not sell, transfer, mortgage or otherwise dispose their equity interests in Guangzhou Huaduo. The term of this agreement is ten years and may be extended at Beijing Huanju Shidai's sole discretion.

•

Powers of Attorney

Pursuant to the irrevocable power of attorney executed by each shareholder of Guangzhou Huaduo, each such shareholder appointed Beijing Huanju Shidai as its attorney-in-fact to exercise such shareholders' rights in Guangzhou Huaduo, including, without limitation, the power to vote on its behalf on all matters of Guangzhou Huaduo requiring shareholder approval under PRC laws and regulations and the articles of association of Guangzhou Huaduo. Each power of attorney will remain in force until the shareholder ceases to hold any equity interest in Guangzhou Huaduo.

•

Share Pledge Agreement

Pursuant to the share pledge agreement between Beijing Huanju Shidai and the shareholders of Guangzhou Huaduo, the shareholders of Guangzhou Huaduo have pledged all of their equity interests in Guangzhou Huaduo to Beijing Huanju Shidai to guarantee the performance by Guangzhou Huaduo and its shareholders' performance of their respective obligations under the exclusive business cooperation agreement, exclusive option agreement, exclusive technology support and technology services agreement and powers of attorney. If Guangzhou Huaduo and/or its shareholders breach their contractual obligations under those agreements, Beijing Huanju Shidai, as pledgee, will be entitled to certain rights, including the right to sell the pledged equity interests.

Beijing Tuda

The Company's relationships with Beijing Tuda and its shareholders are governed by the following contractual arrangements:

•

Exclusive Technology Support and Technology Services Agreement

Pursuant to the exclusive technology support and technology services agreement between Beijing Huanju Shidai and Beijing Tuda, Beijing Huanju Shidai has the exclusive right to provide to Beijing Tuda technology support and technology services related to all technologies needed for its business. Beijing Huanju Shidai owns the exclusive intellectual property rights created as a result of the performance of this agreement. The service fee payable by Beijing Tuda to Beijing Huanju Shidai is determined by various factors, including the expenses Beijing Huanju Shidai incurs for providing such services and Beijing Tuda's revenues. The term of this agreement will expire in 2029 and may be extended with Beijing Huanju Shidai's written confirmation prior to the expiration date. Beijing Huanju Shidai is entitled to terminate the agreement at any time by providing 30 days' prior written notice to Beijing Tuda.

•

Exclusive Business Cooperation Agreement

Pursuant to the exclusive business cooperation agreement between Beijing Huanju Shidai and Beijing Tuda, Beijing Huanju Shidai has the exclusive right to provide to Beijing Tuda technology support, business support and consulting services related to the services provided by Beijing Tuda, the scope of which is to be determined by Beijing Huanju Shidai from time to time. Beijing Huanju Shidai owns the exclusive intellectual property rights created as a result of the performance of this agreement. The service fee payable by Beijing Tuda to Beijing Huanju Shidai is a certain percentage of its earnings. The term of this agreement will expire in 2039 and may be extended with Beijing Huanju Shidai's written confirmation prior to the expiration date. Beijing Huanju Shidai is entitled to terminate the agreement at any time by providing 30 days' prior written notice to Beijing Tuda.

•

Exclusive Option Agreement

The parties to the exclusive option agreement are Beijing Huanju Shidai, Beijing Tuda and each of the shareholders of Beijing Tuda. Under the exclusive option agreement, each of the shareholders of Beijing Tuda irrevocably granted Beijing Huanju Shidai or its designated representative(s) an exclusive option to purchase, to the extent permitted under PRC law, all or part of his or its equity interests in Beijing Tuda. Beijing Huanju Shidai or its designated representative(s) have sole discretion as to when to exercise such options, either in part or in full. Without Beijing Huanju Shidai's prior written consent, Beijing Tuda's shareholders shall not sell, transfer, mortgage or otherwise dispose their equity interests in Beijing Tuda. The term of this agreement is ten years and may be extended at Beijing Huanju Shidai's sole discretion.

•

Powers of Attorney

Pursuant to the irrevocable power of attorney executed by each shareholder of Beijing Tuda, each such shareholder appointed Beijing Huanju Shidai as its attorney-in-fact to exercise such shareholders' rights in Beijing Tuda, including, without limitation, the power to vote on its behalf on all matters of Beijing Tuda requiring shareholder approval under PRC laws and regulations and the articles of association of Beijing Tuda. Each power of attorney will remain in force until the shareholder ceases to hold any equity interest in Beijing Tuda.

•

Share Pledge Agreement

Under the share pledge agreement between Beijing Huanju Shidai and the shareholders of Beijing Tuda, the shareholders of Beijing Tuda have pledged all of their equity interests in Beijing Tuda to Beijing Huanju Shidai to guarantee the performance by Beijing Tuda and its shareholders' performance of their respective obligations under the exclusive business cooperation agreement, exclusive option agreement, exclusive technology support and technology services agreement and powers of attorney. If Beijing Tuda or its shareholders breach their contractual obligations under those agreements, Beijing Huanju Shidai, as pledgee, will be entitled to certain rights, including the right to sell the pledged equity interests.

Through the aforementioned contractual agreements, Guangzhou Huaduo and Beijing Tuda are considered VIEs in accordance with Generally Accepted Accounting Principles in the United States ("US GAAP") because the Company, through Beijing Huanju Shidai has the ability to:

•

exercise effective control over Guangzhou Huaduo or Beijing Tuda;

•

receive substantially all of the economic benefits and residual returns, and absorb substantially all the risks and expected losses from VIEs as if it were their sole shareholder; and

•

have an exclusive option to purchase all of the equity interests in the VIEs.

Management evaluated the relationships among the Company, Beijing Huanju Shidai, the VIEs and concluded that Beijing Huanju Shidai is the primary beneficiary of the VIEs. As a result, the VIEs' results of operations, assets and liabilities have been included in the Company's consolidated financial statements. The adoption of the new consolidation guidance effective January 1, 2010 did not change the Group's conclusions on consolidation.

As of December 31, 2013, the total assets of the consolidated VIEs and VIE's subsidiary were RMB1,443,127, mainly comprising cash and cash equivalents, short-term deposits, accounts receivable, prepayments and other current assets, investment, property and equipment, intangible assets and deferred tax assets. As of December 31, 2013, the total liabilities of the consolidated VIEs and VIE's subsidiary were RMB615,776, mainly comprising accounts payable, deferred revenue, accrued liabilities and other current liabilities, income taxes payable and advances from customers.

In accordance with the aforementioned agreements, the Company has power to direct activities of the VIEs, and can have assets transferred out of the VIEs. Therefore the Company considers that there is no asset in the consolidated VIEs and VIE's subsidiary that can be used only to settle obligations of the consolidated VIEs and VIE's subsidiary, except for registered capital and PRC statutory reserves of the VIEs and VIE's subsidiary amounting to RMB241,657 as of December 31, 2013. As the consolidated VIEs and VIE's subsidiary were incorporated as limited liability companies under the PRC Company Law, the creditors do not have recourse to the general credit of the Company for all the liabilities of the consolidated VIEs and VIE's subsidiary.

Currently there is no contractual arrangement that could require the Company to provide additional financial support to the VIEs. As the Company is conducting its PRC internet value-added services business through the VIEs, the Company will, if needed provide such support on a discretional basis in the future, which could expose the Company to a loss.

There is no VIE where the Company has variable interest but is not the primary beneficiary.

(f) Share Split

On December 23, 2009, the board of directors of Duowan BVI approved a 1 to 490 share split of all of its outstanding common shares and a proportional adjustment to the existing conversion ratios for each series of preferred shares. Accordingly, all share, share option and per share amounts for all periods presented in these consolidated financial statements and notes thereto, have been adjusted retrospectively, where applicable, to reflect this share split and adjustment of the preferred shares conversion ratio.

- Definition

The entire disclosure for organization, consolidation and basis of presentation of financial statements disclosure.

+ References

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+ Details

Principal accounting policies

12 Months Ended

Dec. 31, 2013

Principal accounting policies

Principal accounting policies

2. Principal accounting policies

(a) Basis of presentation

The consolidated financial statements have been prepared on a historical cost basis to reflect the financial position and results of operations of the Group in accordance with the US GAAP.

(b) Consolidation

The Group's consolidated financial statements include the financial statements of the Company, its subsidiaries, and its VIEs and VIE's subsidiary for which the Company or its subsidiary is the primary beneficiary. All transactions and balances among the Company, its subsidiaries, its VIEs and VIE's subsidiary have been eliminated upon consolidation.

The First Reorganization, the Second Reorganization and the Third Reorganization, as described in Note 1 have been accounted for at historical costs. The assets and liabilities of Guangzhou Huaduo and its subsidiary, and Beijing Tuda are consolidated in the Company's financial statements at carryover basis. The accompanying consolidated statements of operations and comprehensive (loss) income and consolidated statements of cash flows include the results of operations and cash flows of the Group as if the current group structure had been in existence throughout the years ended December 31, 2011, 2012 and 2013, or since their respective dates of incorporation. The accompanying consolidated balance sheets have been prepared to present the financial position of the Group as of December 31, 2012 and 2013 as if the current group structure had been in existence as of these dates.

A subsidiary is an entity in which the Company, directly or indirectly, controls more than one half of the voting powers; or has the power to appoint or remove the majority of the members of the board of directors; or to cast a majority of votes at the meeting of directors; or has the power to govern the financial and operating policies of the investee under a statute or agreement among the shareholders or equity holders.

A VIE is an entity in which the Company, or its subsidiary, through contractual agreements, bears the risks of, and enjoys the rewards normally associated with ownership of the entity, and therefore the Company or its subsidiary is the primary beneficiary of the entity. In determining whether the Company or its subsidiaries are the primary beneficiary, the Company considered whether it has the power to direct activities that are significant to the VIEs economic performance, and also the Company's obligation to absorb losses of the VIE that could potentially be significant to the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE. Beijing Huanju Shidai and ultimately the Company holds all the variable interests of the VIEs and has been determined to be the primary beneficiary of the VIEs.

(c) Use of estimates

The preparation of the Company's consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ materially from such estimates. The Company believes that lives of the game and lives of the user relationship related to online games revenue, the determination of estimated selling prices of multiple element revenue contracts, sales rebate to advertising agencies, income taxes, allowances for doubtful accounts, determination of share-based compensation expenses, impairment assessment of goodwill, long-lived assets and intangible assets, represent critical accounting policies that reflect more significant judgments and estimates used in the preparation of its consolidated financial statements.

Management bases the estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Actual results could differ from these estimates.

(d) Foreign currency translation

The Group uses Renminbi ("RMB") as its reporting currency. The functional currency of the Company and its subsidiaries incorporated in the Cayman Islands, British Virgin Islands, and Hong Kong is United States dollar ("US$"), while the functional currency of the other entities, VIEs and VIE's subsidiary in the Group is RMB, which is their respective local currency. In the consolidated financial statements, the financial information of the Company and its subsidiaries, which use US$ as their functional currency, have been translated into RMB. Assets and liabilities are translated at the exchange rates on the balance sheet date, equity amounts are translated at historical exchange rates, and revenues, expenses, gains, and losses are translated using the average exchange rate for the period. Translation adjustments arising from these are reported as foreign currency translation adjustments and are shown as a component of other comprehensive income or loss in the statement of operations and comprehensive (loss) income.

Foreign currency transactions denominated in currencies other than functional currency are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies at the balance sheet date are remeasured at the applicable rates of exchange in effect at that date. Foreign exchange gains and losses resulting from the settlement of such transactions and from remeasurement at year-end are recognized in foreign currency exchange gains (losses), net in the consolidated statement of operations.

(e) Convenience translation

Translations of amounts from RMB into US$ for the convenience of the reader were calculated at the noon buying rate of US$1.00 = RMB6.0537 on December 31, 2013 as set forth in the H.10 statistical release of the U.S. Federal Reserve Board. No representation is made that the RMB amounts could have been, or could be, converted into US$ at such rate.

(f) Fair value of financial instruments

The Group's financial instruments consist principally of cash and cash equivalents, short-term deposits, accounts receivable, other receivables, amounts due from (to) related parties, accounts payable and other payables. The carrying values of these balances approximate their fair values due to the current and short-term nature of these balances.

(g) Cash and cash equivalents

Cash includes currency on hand and deposits held by financial institutions that can be added to or withdrawn without limitation. Cash equivalents represent short-term and highly liquid investments placed with banks, which have both of the following characteristics:

- i)
  
  Readily convertible to known amounts of cash throughout the maturity period;
  
  ii)
  
  So near their maturity that they present insignificant risk of changes in value because of changes in interest rates.

(h) Short-term deposits

Short-term deposits represent time deposits placed with banks with original maturities of less than one year. Interest earned is recorded as interest income in the consolidated statements of operations during the periods presented.

(i) Accounts receivable, net

Accounts receivable are presented net of allowance for doubtful accounts. The Group uses specific identification in providing for bad debts when facts and circumstances indicate that collection is doubtful and a loss is probable and estimable. If the financial conditions of its customers were to deteriorate, resulting in an impairment of their ability to make payments, additional allowance may be required.

The Company reviews on a periodic basis for doubtful accounts based on historical experience and information available. Additionally, the Company makes specific bad debt provisions based on (i) its specific assessment of the collectability of all significant accounts; and (ii) any specific knowledge the Company has acquired that might indicate that an account is uncollectible. The facts and circumstances of each account may require the Company to use substantial judgment in assessing its collectability.

(j) Equity investment

The equity investment is comprised of investments in privately-held companies. The Group accounts for its equity investment over which it has significant influence but does not own a majority equity interest or otherwise control using the equity method. The Group assesses its equity investment for other-than-temporary impairment by considering factors including, but not limited to, current economic and market conditions, operating performance of the companies, including current earnings trends and undiscounted cash flows, and other company-specific information. The fair value determination, particularly for investment in privately-held companies, requires judgment to determine appropriate estimates and assumptions. Changes in these estimates and assumptions could affect the calculation of the fair value of the investment and determination of whether any identified impairment is other-than-temporary.

(k) Cost investment

The cost investment is comprised of investments in privately-held companies. The Group accounts for cost investment which has no readily determinable fair value using the cost method. Under the cost method, the investment is measured initially at cost. The investment carried at cost should recognize income when dividends are received from the distribution of the investee's earnings. The Group periodically evaluates the carrying value of investments accounted for under the cost method of accounting and any impairment is included in the consolidated statements of operations.

(l) Property and equipment

Property and equipment are stated at historical cost less accumulated depreciation and impairment loss, if any. Depreciation is calculated using the straight-line method over their estimated useful lives. Residual rate is determined based on the economic value of the equipment at the end of the estimated useful lives as a percentage of the original cost.

	Estimated useful lives	Residual rate

Servers, computers and equipment	3 years	0%-5%
Furniture, fixture and office equipment	5 years	0%-5%
Motor vehicles	4 years	5%
Leasehold improvement	Shorter of lease term or 5 years	—

Expenditures for maintenance and repairs are expensed as incurred. The gain or loss on the disposal of property and equipment is the difference between the net sales proceeds and the carrying amount of the relevant assets and is recognized in the consolidated statements of operations.

All direct and indirect costs that are related to the construction of property and equipment and incurred before the assets are ready for their intended use are capitalized as construction in progress. Construction in progress is transferred to specific property and equipment items and depreciation of these assets commences when they are ready for their intended use.

(m) Business combinations

The Group accounts for acquisitions of entities that include inputs and processes and have the ability to create outputs as business combinations. The Group allocates the purchase price of the acquisition to the tangible assets, liabilities, and identifiable intangible assets acquired based on their estimated fair values. The excess of the purchase price over those fair values is recorded as goodwill. Acquisition-related costs generally are expensed as incurred.

(n) Intangible assets, net

Intangible assets mainly consist of software and domain names purchased from third parties. Identifiable intangible assets are carried at acquisition cost less accumulated amortization and impairment loss, if any. Finite-lived intangible assets are tested for impairment if impairment indicators arise. Amortization of finite-lived intangible assets is computed using the straight-line method over the following estimated useful lives, which are as follows:

		Estimated useful lives

Software			3-5 years
Technology			5 years
Domain name			15 years

(o) Impairment of long-lived assets

For other long-lived assets including amortizable intangible assets and property and equipment, the Group evaluates for impairment whenever events or changes (triggering events) indicate that the carrying amount of an asset may no longer be recoverable. The Group assesses the recoverability of the long-lived assets by comparing the carrying value of the long-lived assets to the estimated undiscounted future cash flows expected to receive from use of the assets and their eventual disposition. Such assets are considered to be impaired if the sum of the expected undiscounted cash flows is less than the carrying amount of the assets. The impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets.

(p) Goodwill

Goodwill represents the excess of the purchase price over the amounts assigned to the fair value of the assets acquired and the liabilities assumed of an acquired business.

(q) Annual test for impairment of goodwill

Goodwill assessment for impairment is performed on at least an annual basis on October 1 or whenever events or changes in circumstances indicate that the carrying value of the asset may not be recoverable. The Group performs a two-step goodwill impairment test. The first step compares the fair values of each reporting unit to its carrying amount, including goodwill. If the fair value of a reporting unit exceeds its carrying amount, goodwill is not considered impaired and the second step will not be required. If the carrying amount of a reporting unit exceeds its fair value, the second step compares the implied fair value of the affected reporting unit's goodwill to the carrying value of that goodwill. The implied fair value of goodwill is determined in a manner similar to accounting for a business combination with the allocation of the assessed fair value determined in the first step to the assets and liabilities of the reporting unit. The excess of the fair value of the reporting unit over the amounts assigned to the assets and liabilities is the implied fair value of goodwill. This allocation process is only performed for purposes of evaluating goodwill impairment and does not result in an entry to adjust the value of any assets or liabilities. An impairment loss is recognized for any excess in the carrying value of goodwill over the implied fair value of goodwill. The judgment in estimating the fair value of reporting units includes estimating future cash flows, determining appropriate discount rates and making other assumptions. Changes in these estimates and assumptions could materially affect the determination of the fair value of each reporting unit.

No goodwill impairment losses were recognized for the years ended December 31, 2011, 2012 and 2013.

(r) Operating leases

Leases in which a significant portion of the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating lease are charged to the consolidated statements of operations on a straight-line basis over the period of the lease.

(s) Revenue recognition

The Group generates revenues from internet value-added services ("IVAS") and online advertising. Revenues from IVAS are generated from online music and entertainment, online games, membership

subscription fees and other IVAS. Online advertising revenues are primarily generated from sales of different forms of advertising on the Group's platform. Revenue is recognized when persuasive evidence of an arrangement exists, service has been rendered, the price is fixed or determinable and collection is reasonably assured. Revenue is deferred until these criteria are met as described below.

(i)

Internet value-added services

The Group operates a virtual currency system, under which, the users can directly purchase virtual currency, virtual items on YY Client's online community channels or pay membership subscription fees via online payment systems provided by third parties including payments using mobile phone, internet debit/credit card payment and other third party payment systems. The virtual currency can be converted into game tokens that can be used to purchase virtual items in online games (both developed by third parties and self-developed), or used directly to purchase virtual items on YY Client's online community channels or used to pay membership subscription fees. Virtual currency sold but not yet consumed by the purchasers is recorded as "Advances from customers" and upon conversion or being used, is recognized as revenue according to the respective prescribed revenue recognition policies addressed below:
- (1)
  
  Online music and entertainment revenue
The Group creates and offers virtual items to be used by users on online music and entertainment channels, which the Group operates and maintains. The virtual items are offered free of charge or sold to users at different specified prices as pre-determined by the Company. Online music and entertainment revenue consists of sales of virtual items. Users purchase consumable virtual items from the Group and present them to performers to show support for their favorite performers or time-based virtual items, which provide users with recognized status, such as priority speaking rights or special symbols on the music channels for a specific period of time. In order to attract user traffic, the Group shares with certain popular performers and channel owners, who have entered into revenue sharing arrangements with the Group, a portion of the revenues the Group derives from such in-channel virtual item sales on online music and entertainment channels, which the Group accounts for as cost of revenues. Performers and channel owners, who do not have revenue sharing arrangements with the Group, are not entitled to share any revenue derived from the virtual items sold. The Group does not recognize any revenue from offering free virtual items nor share any revenue with performers or channel owners when free virtual items are presented to performers by the users. Accordingly, online music and entertainment revenue is recognized for the sale of virtual items sold in online music and entertainment channels immediately if the virtual item is a consumable or, in the case of time-based virtual items, recognized ratably over the period each virtual item is made available to the user, which does not exceed one year. The Group does not have further obligations to the user after the virtual items are consumed. Virtual items may be sold individually or bundled into one arrangement. When the Group's users purchase multiple virtual items bundled within the same arrangement, the Group evaluates such arrangements under ASC 605-25 Multiple-Element Arrangements. The Group identifies individual elements under the arrangement and determines if such elements meet the criteria to be accounted for as separate units of accounting. The Group

allocates the arrangement consideration to the separate units of accounting based on their relative selling price. The following hierarchy has been followed when determining the relative selling price for each element: (1) vendor specific objective evidence ("VSOE"), (2) third party evidence ("TPE"), and (3) best estimate of selling price ("BESP"). Given that the VSOE of the selling price cannot be determined, the Group has adopted a policy to allocate the consideration of the whole arrangement to different virtual item elements based on the TPE of selling price or the BESP for each virtual item element. The Group determines the fair values of virtual items sold in a bundle based on similar products sold separately on the YY platform based on the TPE of the selling price and determines the fair values of virtual items without similar products sold separately on the YY platform based on the BESP. The BESP is generally based on the selling prices of the various elements of a similar nature when they are sold to users on a stand-alone basis. The BESP may also be based on an estimated stand-alone pricing when the element has not previously been sold on a stand-alone basis.

These estimates are generally determined based on pricing strategies, market factors and strategic objectives. The Group recognizes revenue for each virtual item element in accordance with the applicable revenue recognition method.
- (2)
  
  Online games revenue

        The Group generates revenues from offering virtual items in online games developed by third parties or the Group itself to gaming players. Historically, the majority of online games revenues for the three years ended December 31, 2011, 2012 and 2013 were derived from third parties developed games.

        Users play games through the Group's platform free of charge and are charged for purchases of virtual items including consumable and perpetual items, which can be utilized in the online games to enhance their game-playing experience. Consumable items represent virtual items that can be consumed by a specific user within a specified period of time. Perpetual items represent virtual items that are accessible to the users' account over the life of the online games.

        The Group recognizes revenue when recognition criteria defined under US GAAP are satisfied. For purposes of determining when the service has been provided to the paying player, the Group has determined that an implied obligation exists to the paying player to continue providing access to the games such that the users can utilize the virtual items purchased by game tokens. Game players need to log on and access the games through the Group's platform because their game tokens, virtual items, and game history are specific to the Group's game accounts and non-transferable to other platforms. To purchase in-game virtual items, players can either charge their game accounts by purchasing game tokens or virtual currency from the Group's platform, which are convertible into game tokens based on a predetermined exchange rate agreed among the Group and the relevant game developers.

The proceeds from the purchase of the Group's virtual currency is recorded as "advances from customers", representing prepayments received from users in the form of the Group's virtual currency not yet converted into game specific tokens. Upon the conversion into a game token from the Group's virtual currency or upon the direct purchase of a game token, whichever is applicable, the proceeds will be shared between the Group and the relevant game developer based on a predetermined contractual ratio. Game tokens are non-refundable and non-exchangeable among different games. The Group's portion, net of the game developer's entitled consideration, is recorded as deferred revenue and amortized according to the prescribed revenue recognition policies described below. Users typically do not convert the virtual currency into game tokens or purchase the game tokens unless they plan to purchase in-game virtual items soon.
- –
  
  Third party developed online games
Pursuant to contracts signed between the Group and the respective game developers, revenues from the sale or conversion of game tokens to be used for the purchase of in-game virtual items from online games developed by third parties are shared between the Group and the game developers based on a pre-agreed ratio for each game. These revenue-sharing contracts typically last one to two years.

The third party developed games are primarily under non-exclusive licensing contracts, maintained and updated by the game developers. The Group views the game developers to be the Group's customers and considers the Group's responsibilities under the Group's agreements with the game developers to offer certain standard promotions that include providing access to the platform, announcing the new games to users on the platform, and occasional advertising on the YY platform. The determination of whether to record these revenues using gross or net method is based on an assessment of various factors. The primary factors are whether the Group is acting as the principal in offering services to the game players or as agent in the transaction, and the specific requirement of each contract. The Group determined that for third party developed games, the third party game developers are the principal given the game developers design and develop the web-game services offered, have reasonable latitude to establish prices of game tokens, and are responsible for maintaining and upgrading the game contents and virtual items. Accordingly, the Group records online games revenue, net of the pre-agreed portion of sharing of the revenues with the game developers.

        Given that third party developed games are managed and administered by the third party game developers, the Group does not have access to the data on the consumption details such as when the game token is spent on the virtual items or the types of virtual items (consumable or perpetual items) purchased by each individual game player. However, the Group maintains historical data on timing of the conversion of its virtual currency into game specific tokens and the amount of purchases of game tokens. The Group believes that its performance for, and obligation to, the game developers correspond to the game developers' services to the users. The Group has adopted a policy to recognize revenues relating to game tokens for third party developed games over the estimated user relationship with the Group on a game-by-game basis, which are approximately one to six months for the periods presented. Future usage patterns may differ from historical usage patterns and therefore the estimated user relationship with the Group may change in the future.

        When the Group launches a new game, it estimates the user relationship based on other similar types of games in the market until the new game establishes its own history. The Group considers the game's profile, attributes, target audience, and its appeal to players of different demographics groups in estimating the user relationship period.

        The estimated user relationship period is based on data collected from those users who have acquired game tokens. To estimate the user relationship period, the Group maintains a software system that captures the following information for each user: (a) the frequency that users log into each game via the Group's platform, and (b) the amount and the timing of when the users convert or charge his or her game tokens. The Group estimates the user relationship period for a particular game to be the date a player purchases or converts from virtual currency to a game token through the date the Group estimates the user plays the game for the last time. This computation is completed on a user by user basis. Then, the results for all analyzed users are averaged to determine an estimated end user relationship period for each game. Revenues from in-game payments of each month are recognized over the user relationship period estimated for that game.

        The consideration of user relationship with each online game is based on the Group's best estimate that takes into account all known and relevant information at the time of assessment. The Group assesses the estimated user relationships on a quarterly basis. Any adjustments arising from changes in the user relationship as a result of new information will be accounted as a change in accounting estimate in accordance with ASC 250 Accounting Changes and Error Corrections.
- –
  
  Self-developed games

Revenues derived from self-developed games are recorded on a gross basis as the Group acts as a principal to fulfill all obligations. The Group does not maintain information on consumption details of in-game virtual items, and only has limited information related to the frequency of log-ons for its self-developed games. Given that certain historical data is not available, the Group uses the user relationship of third party games with similar popularity, gaming experience and sales to determine the estimated period of user relationship for its self-developed games.
(3) Other IVAS revenue

Other IVAS revenue mainly represents membership subscription revenue, revenue from sales of virtual items in various channels in YY platform, such as live game broadcasting channels etc. and other miscellaneous product sales in YY platform.

The Group operates a membership subscription program where subscription members can have enhanced user privileges when using YY Client. The membership fee is collected up-front from subscribers. The receipt of the revenue is initially recorded as deferred revenue and revenue is recognized ratably over the period of the subscription as services are rendered. Unrecognized portion beyond 12 months from balance sheet date is classified as long-term deferred revenue. Revenue from sales of virtual items in various channels is recognized on item basis, which is consistent with the revenue recognition policies in online music and entertainment revenue stream.

(ii)

Advertising revenues

        Advertising revenues are derived principally from advertising arrangements where the advertisers pay to place their advertisements on the Group's platform in different formats over a particular period of time. Such formats generally include but are not limited to banners, text-links, videos, logos, and buttons. Advertisements on the Group's platform are generally charged on the basis of duration, and advertising contracts are signed to establish the fixed price and the advertising services to be provided. Where collectability is reasonably assured, advertising revenues from advertising contracts are recognized ratably over the contract period of display.

        The Group enters into advertising contracts directly with advertisers or third party advertising agencies that represent advertisers. Contract terms generally range from 1 to 3 months. Both third party advertising agencies and direct advertisers are generally billed at the end of the display period and payments are due usually within 6 months.

        Where customers purchase multiple advertising spaces with different display periods in the same contract, the Group allocates the total consideration to the various advertising elements based on the relative selling price method and recognizes revenue for the different elements over their respective display periods. The following hierarchy should be followed when determining the appropriate selling price for each element: (1) vendor specific objective evidence ("VSOE"), (2) third party evidence ("TPE"), and (3) best estimate of selling price ("BESP"). Given that the VSOE or TPE of the selling price cannot be determined, the Group has adopted a policy to allocate the fair values of different advertising elements based on the best estimate selling prices of each advertisement within the contract taking into consideration the standard price list and historical discounts granted. The Group recognizes revenue on the elements delivered and defers the recognition of revenue for the fair value of the undelivered elements until the remaining obligations have been satisfied. Where all of the elements within an arrangement are delivered uniformly over the agreement period, the revenues are recognized on a straight line basis over the contract period.

Transactions with third party advertising agencies

For contracts entered into with third party advertising agencies, the third party advertising agencies will in turn sell the advertising services to advertisers. Revenue is recognized ratably over the contract period of display based on the following criteria:

•

There is persuasive evidence that an arrangement exists—the Group will enter into framework and execution agreements with the advertising agencies, specifying price, advertising content, format and timing

•

Price is fixed or determinable—price charged to the advertising agencies are specified in the agreements, including relevant discount and rebate rates

•

Services are rendered—the Group recognizes revenue ratably as the element are delivered over the contract period of display

•

Collectability is reasonably assured—the Group assesses credit history of each advertising agency before entering into any framework and execution agreements. If the collectability from the agencies is assessed as not reasonably assured, the Group recognizes revenue only when the cash is received and all the other revenue criteria are met.

        The Group provides sales incentives in the forms of discounts and rebates to third party advertising agencies based on purchase volume. As the advertising agencies are viewed as the customers in these transactions, revenue is recognized based on the price charged to the agencies, net of sales incentives provided to the agencies. Sales incentives are estimated and recorded at the time of revenue recognition based on the contracted rebate rates and estimated sales volume based on historical experience.

        Transactions with advertisers

        The Group also enters into advertisement contracts directly with advertisers. Similar to transactions with third party advertising agencies, the Group recognizes revenue ratably as the elements are delivered over the contract period of display. The terms and conditions, including price, are fixed according to the contract between the Group and the advertisers. The Group also performs a credit assessment of all advertisers prior to entering into contracts. Revenue is recognized based on the amount charged to the advertisers, net of discounts.

(t) Advances from customers and deferred revenue

Advances from customers primarily consist of (i) prepayments from users in the form of the Group's virtual currency that are not yet consumed or converted into game tokens, and upon the consumption or conversion, are recognized as revenue according to the prescribed revenue recognition policies described above, (ii) prepayments from sub-licensees for obtaining operation rights of certain online games over a period of time, and (iii) prepayments from advertising agencies and advertisers.

Deferred revenue primarily consists of the unamortized game tokens, prepaid subscriptions under the membership program and unamortized revenue from virtual items in online music and entertainment channels, where there is still an implied obligation to be provided by the Group, which will be recognized as revenue when all of the revenue recognition criteria are met.

(u) Cost of revenues

Amounts recorded as cost of revenue relate to direct expenses incurred in order to generate IVAS and advertising revenue. Such costs are recorded as incurred. Cost of revenues consists primarily of (i) revenue sharing fees and content costs, including payments to various channel owners and performers, and content providers, (ii) bandwidth costs, (iii) salary and welfare, (iv) share-based compensation, (v) business taxes and related surcharges, cultural development fee, (vi) depreciation and amortization expense for servers, other equipment and intangibles directly related to operating the platform,(vii) payment handling cost, and (viii) other costs.

In the PRC, business taxes are imposed by the government on revenues reported by any selling entity for the provision of taxable services in the PRC, transfer of intangible assets and sales of immovable properties in the PRC. The business tax rate varies depending on the nature of the revenues. The Group is also subject to cultural development fee at a tax rate of 3% on service income from provision of advertising services in the PRC.

On January 1, 2012, a pilot program (the "Pilot Program") was launched in Shanghai for a transition of imposing value-added tax ("VAT") on revenues derived from certain pilot industries (the "Pilot Industries") other than business taxes. Starting from September 1, 2012, the Pilot Program was expanded from Shanghai to eight other cities and provinces in the PRC, including Beijing and Guangdong province, where the Group's subsidiaries and VIEs are incorporated and have operations therein. The Group's advertising revenue and online games revenue are within the scope of Pilot Industries and they became subject to VAT effective from November 1, 2012 and December 1, 2012, at a rate of 6% respectively. The Group hence recognizes advertising revenue and online games revenue net of VAT thereafter. Prior to the Pilot Program's being applied to Group's revenue, the Group's advertising revenues earned from external customers were subject to business taxes at 5% for the year ended December 31, 2011, and ten months ended October 31, 2012, and the Group' IVAS revenue earned from external customers were subject to business taxes of 3% for the years ended December 31, 2011, 2012 and 2013, except that the Group's online games revenue began to be subject to VAT of 6% commencing December 2012.

The Group is subject to surcharges of business taxes and VAT, which are calculated based on 12% of the business taxes and VAT payable for the years ended December 31, 2011, 2012 and 2013.

The Group reported business taxes and surcharges, and cultural development fees incurred in cost of revenues.

Based on the Group's corporate structure and the contractual arrangements among the Group's PRC subsidiaries, the Group's VIEs and their shareholders, the Group is effectively subject to the 5% PRC business tax and generally subject to 6% VAT and related surcharges on revenues generated by the Group's subsidiaries based on the Group's contractual arrangements entered into with the Group's VIEs.

(v) Research and development expenses

Research and development expenses consist primarily of (i) salary and welfare for research and development personnel, (ii) share-based compensation for research and development personnel, (iii) rental expenses and (iv) depreciation of office premise and servers utilized by research and development personnel. Costs incurred during the research stage are expensed as incurred. Costs incurred in the development stage, prior to the establishment of technological feasibility, which is when a working model is available, are expensed when incurred.

The Company recognizes internal use software development costs in accordance with guidance on intangible assets and internal use software. This requires capitalization of qualifying costs incurred during the software's application development stage and to expense costs as they are incurred during the preliminary project and post implementation/operation stages. The Company has not capitalized any costs related to internal use software during the years ended December 31, 2011, 2012 and 2013, respectively.

(w) Sales and marketing expenses

Sales and marketing expenses consist primarily of (i) salary and welfare for sales and marketing personnel, (ii) advertising and market promotion expenses, and (iii) share-based compensation for sales and marketing personnel. The advertising and market promotion expenses amounted to approximately RMB4,234, RMB5,534 and RMB8,054 during the years ended December 31, 2011, 2012 and 2013, respectively.

(x) General and administrative expenses

General and administrative expenses consist primarily of (i) salary and welfare for general and administrative personnel, (ii) share-based compensation for management and administrative personnel, (iii) allowance for doubtful receivables, and (iv) professional service fees.

(y) Employee social security and welfare benefits

Employees of the Group in the PRC are entitled to staff welfare benefits including pension, work-related injury benefits, maternity insurance, medical insurance, unemployment benefit and housing fund plans through a PRC government-mandated multi-employer defined contribution plan. The Group is required to accrue for these benefits based on certain percentages of the employees' salaries, up to a maximum amount specified by the local government. The Group is required to make contributions to the plans out of the amounts accrued. The PRC government is responsible for the medical benefits and the pension liability to be paid to these employees and the Group's obligations are limited to the amounts contributed and no legal obligation beyond the contributions made. Employee social security and welfare benefits included as expenses in the accompanying statements of operations amounted to RMB23,657, RMB39,660 and RMB68,334 for the years ended December 31, 2011, 2012 and 2013, respectively.

(z) Share-based compensation

The Company grants stock-based award, such as, but not limited to, share options, restricted shares, restricted share units and warrants to eligible employees, officers, directors, and non-employee consultants.

Awards granted to employees, officers, and directors are initially accounted for as equity-classified awards. The related shared-based compensation expenses are measured at the grant date fair value of the award and are recognized using the graded vesting method, net of estimated forfeiture rates, over the requisite service period, which is generally the vesting period. Forfeitures are estimated at the time of grant based on historical forfeiture rates and will be revised in the subsequent periods if actual forfeitures differ from those estimates. Duowan BVI also granted share options, restricted shares and restricted share units to non-employees, which are also initially accounted for as equity-classified awards. Awards granted to non-employees are initially measured at fair value on the grant date and periodically re-measured thereafter until the earlier of the performance commitment date or the date the service is completed and recognized over the period the service is provided. Awards are re-measured at each reporting date using the fair value as at each period end until the measurement date, generally when the services are completed and share-based awards are vested. Changes in fair value between the interim reporting dates are attributed consistent with the method used in recognizing the original compensation costs.

As a result of Duowan BVI's repurchases of certain awards offered in 2009 and in 2011 (Note 19), certain initially equity classified employee and non-employee awards had been reclassified as a liability classified award, as these awards were deemed to have a substantive cash settlement feature. These awards are re-measured at the end of each reporting period until either the substantive cash settlement is terminated or the holder of the awards is exposed to the market value fluctuation of the underlying shares for a reasonable period of time (at least six months), or the awards are settled, cancelled or expire unexercised.

On September 15, 2011, the board of directors of the Company resolved not to undertake any repurchases of vested or unvested share-based compensation awards, except under those conditions specified in the relevant award scheme and grant documents. In addition, any proposed repurchase of vested or unvested share-based compensation awards should be approved by the majority votes of the board of directors. Such intention of the Company was specifically communicated to all employees with or without the awards. All the employees with vested or unvested awards also confirmed such understanding by a written confirmation. Accordingly, the classification of the liability-classified awards changed back to be equity-classified.

Prior to the initial public offering date (Note 17), the Binomial option-pricing model was used to measure the fair value of all the share options. The determination of the fair value was affected by the share price as well as assumptions regarding a number of complex and subjective variables, including the expected share price volatility, actual and projected employee and non-employee share option exercise behaviour, risk-free interest rates and expected dividends. The use of the Binomial option-pricing model requires extensive actual employee, directors, officers and non-employee exercise behaviour data for the relative probability estimation purpose, and a number of complex assumptions.

Following the listing of the Company, the grant date fair value of share-based awards is based on stock price of the Company in the NASDAQ Global Market.

(aa) Other income

Other income primarily consists of government grants which represent cash subsidies received from the PRC government by the operating subsidiaries or VIEs of the Company. Government grants are

originally recorded as deferred revenue when received upfront. After all of the conditions specified in the grants have been met, the grants are recognized as operating or non-operating income based on the nature of the government grants.

(bb) Income taxes

Current income taxes are provided on the basis of net income for financial reporting purposes, adjusted for income and expense items which are not assessable or deductible for income tax purposes, in accordance with the regulations of the relevant tax jurisdictions. Deferred income taxes are accounted for using an asset and liability method. Under this method, deferred income taxes are recognized for the tax consequences of temporary differences by applying enacted statutory rates applicable to future years to differences between the financial statement carrying amounts and the tax bases of existing assets and liabilities. The tax base of an asset or liability is the amount attributed to that asset or liability for tax purpose. The effect on deferred taxes of a change in tax rates is recognized in statement of operations and comprehensive (loss) income in the period of change. A valuation allowance is provided to reduce the amount of deferred tax assets if it is considered more likely than not that some portion of, or all of the deferred tax assets will not be realized.

Uncertain tax positions

The guidance on accounting for uncertainties in income taxes prescribes a more likely than not threshold for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. Guidance was also provided on derecognition of income tax assets and liabilities, classification of current and deferred income tax assets and liabilities, accounting for interest and penalties associated with tax positions, accounting for income taxes in interim periods, and income tax disclosures. Significant judgment is required in evaluating the Group's uncertain tax positions and determining its provision for income taxes. The Group recognizes interests and penalties, if any, under accrued expenses and other current liabilities on its balance sheet and under other expenses in its statements of operations. The Group did not recognize any significant interest and penalties associated with uncertain tax positions for the years ended December 31, 2011, 2012 and 2013. As of December 31, 2012 and 2013, the Group did not have any significant unrecognized uncertain tax positions.

(cc) Statutory reserves

The Group's subsidiaries, VIEs and VIE's subsidiary established in the PRC are required to make appropriations to certain non-distributable reserve funds.

In accordance with the laws applicable to China's Foreign Investment Enterprises, the Group's subsidiaries registered as wholly-owned foreign enterprises have to make appropriations from its after-tax profit (as determined under the Accounting Standards for Business Enterprises as promulgated by the Ministry of Finance of the People's Republic of China ("PRC GAAP")) to reserve funds including general reserve fund, and staff bonus and welfare fund. The appropriation to the general reserve fund must be at least 10% of the after-tax profits calculated in accordance with PRC GAAP. Appropriation is not required if the reserve fund has reached 50% of the registered capital of the company. Appropriation to the staff bonus and welfare fund is at the company's discretion.

In addition, in accordance with the Company Laws of the PRC, the VIEs and VIE's subsidiary of the Company registered as PRC domestic companies must make appropriations from its after-tax profit as determined under the PRC GAAP to non-distributable reserve funds including a statutory surplus fund and a discretionary surplus fund. The appropriation to the statutory surplus fund must be at least 10% of the after-tax profits as determined under the PRC GAAP. Appropriation is not required if the surplus fund has reached 50% of the registered capital of the company. Appropriation to the discretionary surplus fund is made at the discretion of the company.

The use of the general reserve fund, statutory surplus fund and discretionary surplus fund are restricted to the off-setting of losses or increasing capital of the respective company. The staff bonus and welfare fund is a liability in nature and is restricted to fund payments of special bonus to staff and for the collective welfare of employees. All these reserves are not allowed to be transferred to the company in terms of cash dividends, loans or advances, nor can they be distributed except under liquidation.

During the year ended December 31, 2013, appropriations to statutory reserves amounted to RMB40,657. No appropriations have been made in 2011 and 2012 since the companies were in accumulated loss positions.

(dd) Related parties

Parties are considered to be related if one party has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operating decisions. Parties are also considered to be related if they are subject to common control or significant influence, such as a family member or relative, shareholder, or a related corporation.

(ee) Dividends

Dividends are recognized when declared. No dividends were declared for the years ended December 31, 2011, 2012 and 2013, respectively. The Group does not have any present plan to pay any dividends on common shares in the foreseeable future. The Group currently intends to retain the available funds and any future earnings to operate and expand its business.

(ff) (Loss) income per share

Basic (loss) income per share is computed by dividing net (loss) income attributable to common shareholders, considering the accretion or decretion of redemption feature, deemed dividend to preferred shareholders and amortization of beneficial conversion feature related to its convertible redeemable preferred shares (Note 20), by the weighted average number of common shares outstanding during the period using the two-class method. Under the two-class method, net income is allocated between common shares and other participating securities based on their participating rights. Net losses are not allocated to other participating securities if based on their contractual terms they are not obligated to share the losses.

Diluted (loss) income per share is calculated by dividing net (loss) income attributable to common shareholders, as adjusted for the effect of dilutive common equivalent shares, if any, by the weighted average number of common and dilutive common equivalent shares outstanding during the period.

Common equivalent shares consist of common shares issuable upon the conversion of the preferred shares, using the if-converted method, and shares issuable upon the exercise of share options using the treasury stock method. Common equivalent shares are not included in the denominator of the diluted loss per share calculation when inclusion of such share would be anti-dilutive.

(gg) Comprehensive (loss) income

Comprehensive (loss) income is defined as the change in equity of the Company during a period arising from transactions and other events and circumstances excluding transactions resulting from investments by shareholders and distributions to shareholders. Comprehensive (loss) income is reported in the consolidated statements of operations and comprehensive (loss) income. Accumulated other comprehensive loss of the Group includes the foreign currency translation adjustments.

(hh) Segment reporting

Operating segments are defined as components of an enterprise engaging in businesses activities for which separate financial information is available that is regularly evaluated by the Group's chief operating decision makers in deciding how to allocate resources and assess performance. The Group's chief operating decision maker has been identified as the Chief Executive Officer, who reviews consolidated results when making decisions about allocating resources and assessing performance of the Group. The Group has internal reporting of cost and expenses that does not distinguish between segments, and reports costs and expenses by nature as a whole. The Group does not distinguish between markets or segments for the purpose of internal reporting. Hence, the Group has only one operating segment. As the Group's long-lived assets and revenue are substantially located in and derived from the PRC, no geographical segments are presented.

(ii) Recently issued accounting pronouncements

In February of 2013, the FASB issued ASU 2013-02, "Comprehensive Income (Topic 220), Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income". The amendments in this ASU require an entity to provide information about amounts reclassified out of accumulated other comprehensive income by component. In addition, an entity is required to present, either on the face of the statement where net income is presented or in the notes, significant amounts reclassified out of accumulated other comprehensive income by the respective line items of net income, but only if the amount reclassified is required under U.S. GAAP to be reclassified to net income in its entirety in the same reporting period. For other amounts that are not required under U.S. GAAP to be reclassified in their entirety to net income (for example, where amounts are reclassified to inventory), an entity is required to cross-reference to other disclosures required under U.S. GAAP that provide additional detail about those amounts. For public entities, the amendments are effective with prospective application for reporting periods beginning after December 15, 2012. The Group adopted this ASU beginning January 1, 2013 and the adoption of this ASU did not have a material impact on the Group's consolidated financial statements.

In March of 2013, the FASB issued ASU 2013-05, "Foreign Currency Matters (Topic 830), Parent's Accounting for the Cumulative Translation Adjustment upon Derecognition of Certain Subsidiaries or Groups of Assets within a Foreign Entity or of an Investment in a Foreign Entity." The amendments in this

ASU clarify the applicable guidance for the de-recognition of all or a portion of a cumulative translation adjustment when an entity ceases to have a controlling financial interest in a subsidiary or group of assets that is a nonprofit activity or a business (other than a sale of in substance real estate or conveyance of oil and gas mineral rights) within a foreign entity or when other changes stipulated in the ASU occur and involve a foreign entity. The amendments are effective prospectively for fiscal years (and interim reporting periods within those years) beginning after December 15, 2013. The amendments should be applied prospectively to derecognition events occurring after the effective date. Prior periods should not be adjusted. Early adoption is permitted. If an entity elects to early adopt the amendments, it should apply them as of the beginning of the entity's fiscal year of adoption. The adoption of this ASU is not reasonably expected in the future to have a material impact on the Group's consolidated financial statements.

In March of 2013, the FASB issued ASU 2013-11, "Income Taxes (Topic 740)—Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists". The amendments in the ASU clarify that an unrecognized tax benefit, or a portion of an unrecognized tax benefit, should be presented in the financial statements as a reduction to a deferred tax asset for a net operating loss, similar tax loss, or tax credit carryforward, except as noted in the following sentence. To the extent a net operating loss, similar tax loss, or tax credit carryforward is not available at the reporting date under the tax law of the applicable jurisdiction to settle any additional income taxes that would result from the disallowance of a tax position or the tax law of the applicable jurisdiction does not require the entity to use, and the entity does not intend to use, the deferred tax asset for such a purpose, then under this exception the unrecognized tax benefit is to be presented in the financial statements as a liability and should not be combined with (netted with) the deferred tax asset(s). The assessment of whether a deferred tax asset is "available" is based on the unrecognized tax benefit and deferred tax asset amounts that exist at the reporting date and should be made presuming disallowance of the tax position at the reporting date. The amendments are effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. Early adoption is permitted. The amendments should be applied prospectively to all unrecognized tax benefits that exist at the effective date. Retrospective application is permitted. The adoption of this ASU is not reasonably expected in the future to have a material impact on the Group's consolidated financial statements.

- Definition

The entire disclosure for all significant accounting policies of the reporting entity.

+ References+ Details

Certain risks and concentration

12 Months Ended

Dec. 31, 2013

Certain risks and concentration

Certain risks and concentration

3. Certain risks and concentration

(a) PRC regulations

Foreign ownership of internet-based businesses is subject to significant restrictions under the current PRC laws and regulations. The PRC government regulates internet access, the distribution of online information and the conduct of online commerce through strict business licensing requirements and other government regulations. These laws and regulations also limit foreign ownership in PRC companies that provide internet information distribution services. Specifically, foreign ownership in an internet information provider or other value-added telecommunication service providers may not exceed 50%. Foreigners or foreign invested enterprises are currently not able to apply for the required licenses for operating online games in the PRC. The Company is incorporated in the Cayman Islands and accordingly, the Company is considered as a foreign invested enterprise under PRC law.

In order to comply with the PRC laws restricting foreign ownership in the online business in China, the Group operates the online business in China through contractual arrangements with Guangzhou Huaduo and Beijing Tuda, the Group's two VIEs. As of December 31, 2013, Mr. David Xueling Li, CEO, Mr. Jun Lei, Chairman of the Company, Mr. Tony Bin Zhao, Director and Chairman of Technology Committee, Mr. Jin Cao, General Manager of the Website Department, and Beijing Tuda own approximately 0.5%, 0.44%, 0.04%, 0.02% and 99% of Guangzhou Huaduo's equity interests, respectively. As of December 31, 2013, Mr. David Xueling Li, Mr. Tony Bin Zhao, and Mr. Jin Cao, own 97.7%, 1.5% and 0.8% of Beijing Tuda's equity interests, respectively.

The VIEs hold the licenses and permits necessary to conduct its internet value-added services and online advertising business in the PRC. If the Company had direct ownership of the VIEs, it would be able to exercise its rights as a shareholder to effect changes in the board of directors, which in turn could affect changes at the management level, subject to any applicable fiduciary obligations. However, under the current contractual arrangements, it relies on the VIEs and its' shareholders' performance of their contractual obligations to exercise effective control. In addition, the Group's contractual agreements have terms range from 10 to 30 years, which are subject to Beijing Huanju Shidai's unilateral termination right. Under the respective service agreements, Beijing Huanju Shidai will provide services including technology support, technology services, business support and consulting services to Beijing Tuda and Guangzhou Huaduo in exchange for service fees. The amount of service fees payable is determined by various factors, including (a) a percentage of Beijing Tuda and Guangzhou Huaduo's revenues or earnings, and (b) the expenses that Beijing Huanju Shidai incurs for providing such services. Beijing Huanju Shidai may charge up to 100% of the income in Beijing Tuda and Guangzhou Huaduo and a multiple of the expenses incurred for providing such services, as determined by Beijing Huanju Shidai from time to time. The service fees payable by Beijing Tuda and Guangzhou Huaduo to Beijing Huanju Shidai are determined to be up to 100% of the profits of the Beijing Tuda and Guangzhou Huaduo, with the timing of such payment to be determined at the sole discretion of Beijing Huanju Shidai. If fees were incurred, it would be significant to the Company and the operating companies' economic performance because it will be incurred and paid at up to 100% of the earnings of the VIEs. Fees incurred would be remitted, subject to further PRC restrictions. None of the VIEs or their shareholders are entitled to terminate the contracts prior to the expiration date, unless under remote circumstances such as a material breach of agreement or bankruptcy as it pertains to the service and business operation agreements and their amendment. For the years ended December 31, 2011 and 2012, no service fees were charged by WOFEs to VIEs as both VIEs had accumulated losses since inception. For the year ended December 31, 2013, Beijing Huanju Shidai determined that service fees of RMB31,153 were charged to Guangzhou Huaduo considering it achieved accumulated profitability during the year ended December 31, 2013. The service fees are typically determined based on the costs and expenses that WOFEs incurs for providing relevant technology support to Guangzhou Huaduo, as well as the consideration of Guangzhou Huaduo's future business development plan and its increasingly growing and diverse operational needs.

Further, the Group believes that the contractual arrangements among Beijing Huanju Shidai, the VIEs, and their shareholders are in compliance with PRC law and are legally enforceable. However, the PRC government may issue from time to time new laws or new interpretations on existing laws to regulate this industry. Regulatory risk also encompasses the interpretation by the tax authorities of current tax laws, and the Group's legal structure and scope of operations in the PRC, which could be subject to further restrictions resulting in limitations on the Company's ability to conduct business in the PRC. The PRC government may also require the Company to restructure the Group's operations entirely if it finds that its contractual arrangements do not comply with applicable laws and regulations. Furthermore, it could revoke the Group's business and operating licenses, require it to discontinue or restrict its operations, restrict its right to collect revenues, block its website, require it to restructure its operations, impose additional conditions or requirements with which the Group may not be able to comply, or take other regulatory or enforcement actions against the Group that could be harmful to its business. The imposition of any of these penalties may result in a material and adverse effect on the Group's ability to conduct the Group's business. In addition, if the imposition of any of these penalties causes the Group to lose the rights to direct the activities of the VIEs or the right to receive their economic benefits, the Group would no longer be able to consolidate the VIEs. The Group does not believe that any penalties imposed or actions taken by the PRC government would result in the liquidation of the Company, Beijing Huanju Shidai, and the VIEs.

The following consolidated financial information of the Group's VIEs and VIE's subsidiary excluding the intercompany items with the Group's subsidiaries was included in the accompanying consolidated financial statements as of and for the years ended:

	December 31,

	2012		2013
	RMB		RMB
Assets
Current assets
Cash and cash equivalents		204,606		575,262
Short-term deposits		90,000		594,000
Accounts receivable, net		41,824		48,329
Amount due from a related party		1,073		73
Prepayments and other current assets		14,897		29,753
Deferred tax assets		25,666		51,631


Total current assets		378,066		1,299,048


Non-current assets
Deferred tax assets		92		383
Investments		2,950		33,920
Property and equipment, net		88,709		100,059
Intangible assets, net		3,218		9,717


Total non-current assets		94,969		144,079


Total assets		473,035		1,443,127




Liabilities
Current liabilities
Accounts payable		27,124		55,818
Deferred revenue		158,323		292,380
Advances from customers		7,271		10,656
Income taxes payable		32,885		47,974
Accrued liabilities and other current liabilities		81,223		197,851
Amounts due to related parties		2,604		2,640


Total current liabilities		309,430		607,319


Non-current liabilities
Deferred revenue		4,525		8,457


Total liabilities		313,955		615,776

	For the year ended December 31,

	2011			2012		2013
	RMB			RMB		RMB
Net revenues		232,376			702,929		1,669,852
Net (loss) income		(79,334	)		80,071		486,095

	For the year ended December 31,

	2011			2012			2013
	RMB			RMB			RMB
Net cash provided by operating activities		57,313			322,378			845,198
Net cash used in investing activities		(46,475	)		(152,197	)		(592,390	)


		10,838			170,181			252,808

(b) Foreign exchange risk

The revenues and expenses of the Group's subsidiaries, VIEs and VIE's subsidiary in the PRC are generally denominated in RMB and their assets and liabilities are denominated in RMB. The Group's financing activities are denominated in U.S. dollars. The RMB is not freely convertible into foreign currencies. Remittances of foreign currencies into the PRC and exchange of foreign currencies into RMB require approval by foreign exchange administrative authorities and certain supporting documentation. The State Administration for Foreign Exchange, under the authority of the People's Bank of China, controls the conversion of RMB into other currencies.

(c) Concentration of risks

- (i)
  
  Concentration of revenue
  - No individual customer accounted for more than 10% of net revenues for the years ended December 31, 2011, 2012 and 2013.
  (ii)
  
  Concentration of accounts receivable
- - The Group collects accounts receivable for IVAS revenue from collection agencies and accounts receivable for online advertising revenue from customers. The Group depends on payments from a limited number of the collection agencies and customers. The top 10 accounts receivable accounted for 96%, 92% and 87% of the total accounts receivable as of December 31, 2011, 2012 and 2013, respectively.
    
    The following table summarizes the percentage of accounts receivable from collection agencies and customers with over 10% of total accounts receivable:

	For the year ended December 31,

	2011	2012	2013
	RMB	RMB	RMB
Collection agencies and customers
B1	31%	34%	25%
B2	*	*	12%
B3	*	16%	11%
B4	12%	*	*
B5	12%	*	*

- - *
    
    Less than 10%

(d) Credit risk

As of December 31, 2012 and 2013, substantially all of the Group's cash and cash equivalents and short-term deposits were held by the PRC and international financial institutions. Management chooses these institutions because of their reputations and track records for stability, and their known large cash reserves, and management periodically reviews these institutions' reputations, track records, and reported reserves. Management expects that any additional institutions that the Group uses for its cash and bank deposits will be chosen with similar criteria for soundness. The balances in the PRC are not insured since it is not a market practice in the PRC. Nevertheless under the PRC law, it is required that a commercial bank in the PRC that holds third party cash deposits should maintain a certain percentage of total customer deposits taken in a statutory reserve fund for protecting the depositors' rights over their interests in deposited money. PRC banks are subject to a series of risk control regulatory standards; PRC bank regulatory authorities are empowered to take over the operation and management of any PRC bank that faces a material credit crisis. The Group believes that it is not exposed to unusual risks as these financial institutions are either PRC banks or international banks that carry at least 'A' credit ratings from one or more credit rating agencies. The Group had not experienced any losses on its deposits of cash and cash equivalents and term deposits during the years ended December 31, 2011, 2012 and 2013 and believes that its credit risk to be minimal.

- Definition

The entire disclosure for any concentrations existing at the date of the financial statements that make an entity vulnerable to a reasonably possible, near-term, severe impact. This disclosure informs financial statement users about the general nature of the risk associated with the concentration, and may indicate the percentage of concentration risk as of the balance sheet date.

+ References+ Details

Business combination

12 Months Ended

Dec. 31, 2013

Business combination

Business combination

4. Business combination

On March 12, 2012, the Group acquired a majority of the assets of an internet service company, which is in the business of operating an internet platform, for cash consideration of RMB11,722. As a result of the acquisition, the Group obtained the key intellectual property to develop and expand the platform of YY Client. The acquisition was recorded using the acquisition method of accounting and the allocation of the purchase price at the date of acquisition is as follows:

		RMB

Property and equipment			128
Intangible assets
Technology			10,035
Software			660
Goodwill			899


Total			11,722

The business combination was completed on March 12, 2012 and there was no further adjustment to the purchase price allocation. The excess of purchase price over tangible assets and identifiable intangible assets acquired and liabilities assumed was recorded as goodwill. The acquired goodwill is not deductible for tax purposes. Acquisition related costs were immaterial and were included in general and administrative expenses for the year ended December 31, 2012.

Pro forma results of operations related to the acquisition have not been presented because they are not material to the Group's consolidated statements of operations and comprehensive (loss) income for the years ended December 31, 2011, 2012 and 2013.

Since the acquired business has been fully integrated into the Company's current business after the acquisition, it is impracticable to disclose separately its standalone revenue and earnings after the acquisition.

- Definition

The entire disclosure for a business combination (or series of individually immaterial business combinations) completed during the period, including background, timing, and recognized assets and liabilities. The disclosure may include leverage buyout transactions (as applicable).

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 805

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+ Details

Cash and cash equivalents

12 Months Ended

Dec. 31, 2013

Cash and cash equivalents

Cash and cash equivalents

5. Cash and cash equivalents

Cash and cash equivalents represent cash on hand and demand deposits placed with banks or other financial institutions. Cash and cash equivalents balance as of December 31, 2012 and 2013 primarily consist of the following currencies:

	December 31, 2012				December 31, 2013

	Amount		RMB equivalent		Amount		RMB equivalent
RMB		460,176		460,176		715,316		715,316
US$		7,084		44,526		2,342		14,282


Total				504,702				729,598

- Definition

The entire disclosure for cash and cash equivalent footnotes, which may include the types of deposits and money market instruments, applicable carrying amounts, restricted amounts and compensating balance arrangements. Cash and equivalents include: (1) currency on hand (2) demand deposits with banks or financial institutions (3) other kinds of accounts that have the general characteristics of demand deposits (4) short-term, highly liquid investments that are both readily convertible to known amounts of cash and so near their maturity that they present insignificant risk of changes in value because of changes in interest rates. Generally, only investments maturing within three months from the date of acquisition qualify.

+ References+ Details

Accounts receivable, net

12 Months Ended

Dec. 31, 2013

Accounts receivable, net

Accounts receivable, net

7. Accounts receivable, net

	December 31,

	2012			2013
	RMB			RMB
Accounts receivable, gross		123,332			131,315
Less: allowance for doubtful receivables		(5,716	)		(31,214	)


Accounts receivable, net		117,616			100,101

The following table summarized the details of the Company's allowance for doubtful accounts:

	For the year ended December 31,

	2011			2012			2013
	RMB			RMB			RMB
Balance at the beginning of the year		(387	)		—			(5,716	)
Additions charged to general and administrative expenses		—			(6,884	)		(31,987	)
Write-off during the year		387			1,168			6,489


Balance at the end of the year		—			(5,716	)		(31,214	)

- Definition

The entire disclosure for claims held for amounts due a entity, excluding financing receivables. Examples include, but are not limited to, trade accounts receivables, notes receivables, loans receivables. Includes disclosure for allowance for credit losses.

+ References+ Details

Investments

12 Months Ended

Dec. 31, 2013

Investments

Investments

8. Investments

	December 31

	2012		2013
	RMB		RMB
Cost investments (i)(ii)		—		47,110
Equity investments		2,950		14,919


Total		2,950		62,029

(i): In June 2013, the Company made an investment with an equity interest of 20% in a company with consideration of RMB15 million. The investment was not an investment in common stock or in-substance common stock and therefore was precluded from applying the equity method of accounting. It has been accounted for as an investment under cost method.
(ii): In December 2013, the Company entered into agreements to acquire a minority stake of preferred shares of two companies with total consideration of approximately RMB28 million. Given the fact that the Company cannot unilaterally demand redemption of both the two preferred stocks as the Company only owns less than or equal to 10% of the two preferred stocks respectively, these investments have been accounted for as an investment in an equity security under cost method since the two equity securities do not have a readily determinable fair value.

Property and equipment, net

12 Months Ended

Dec. 31, 2013

Property and equipment, net

Property and equipment, net

9. Property and equipment, net

Property and equipment consists of the following:

	December 31,

	2012			2013
	RMB			RMB
Gross carrying amount
Servers, computers and equipment		103,005			152,404
Leasehold improvement		22,831			23,257
Furniture, fixture and office equipment		9,083			9,672
Motor vehicles		2,999			5,186
Construction in progress		—			4,652


Total		137,918			195,171
Less: accumulated depreciation		(47,619	)		(92,535	)


Property and equipment, net		90,299			102,636

Depreciation expense for the years ended December 31, 2011, 2012 and 2013 were RMB12,888, RMB29,074 and RMB44,963, respectively.

- Definition

The entire disclosure for long-lived, physical assets used in the normal conduct of business and not intended for resale. Includes, but is not limited to, accounting policies and methodology, roll forwards, depreciation, depletion and amortization expense, including composite depreciation, accumulated depreciation, depletion and amortization expense, useful lives and method used, income statement disclosures, assets held for sale and public utility disclosures.

+ References+ Details

Intangible assets, net

12 Months Ended

Dec. 31, 2013

Intangible assets, net

Intangible assets, net

10. Intangible assets, net

The following table summarizes the Group's intangible assets:

	December 31

	2012			2013
	RMB			RMB
Gross carrying amount
Software		4,235			5,477
Technology		9,962			17,121
Domain name		11,477			17,286


Total of gross carrying amount		25,674			39,884


Less: accumulated amortization
Software		(1,808	)		(3,209	)
Technology		(1,659	)		(4,054	)
Domain name		(2,176	)		(2,944	)


Total accumulated amortization		(5,643	)		(10,207	)


Less: impairment
Software		(550	)		(550	)


Intangible assets, net		19,481			29,127

Amortization expense for the years ended December 31, 2011, 2012 and 2013 were RMB1,211, RMB3,369 and RMB4,707, respectively.

The estimated amortization expenses for each of the following five years are as follows:

	Domain name		Technology		Software

	RMB		RMB		RMB
2014		1,171		3,424		1,263
2015		1,149		3,424		335
2016		1,141		3,424		68
2017		1,141		1,806		33
2018		1,141		989		19

The weighted average amortization periods of intangible assets as of December 31, 2012 and 2013 are as below:

	December 31,

	2012	2013
Domain name	15 years	15 years
Technology	5 years	5 years
Software	3 years	3 years

Deferred revenue

12 Months Ended

Dec. 31, 2013

Deferred revenue

Deferred revenue

12. Deferred revenue

	December 31,

	2012		2013
	RMB		RMB
Deferred revenue, current:
IVAS revenues		157,940		292,184
Government grants		1,919		1,682


Total current deferred revenue		159,859		293,866




Deferred revenue, non-current:
IVAS revenues		4,329		8,457
Government grants		2,158		968


Total non-current deferred revenue		6,487		9,425

Accrued liabilities and other current liabilities

12 Months Ended

Dec. 31, 2013

Accrued liabilities and other current liabilities

Accrued liabilities and other current liabilities

13. Accrued liabilities and other current liabilities

	December 31,

	2012		2013
Accrued salaries and welfare		54,688		113,302
Accrued revenue sharing fees		19,504		66,512
Accrued bandwidth costs		15,679		21,869
Business and other taxes payable		7,422		14,248
Value added taxes payable		8,718		5,291
Accrued technology service fee		2,162		5,040
Others		12,116		24,498


Total		120,289		250,760

Cost of revenue

12 Months Ended

Dec. 31, 2013

Cost of revenue

Cost of revenue

14. Cost of revenue

	For the year ended December 31,

	2011		2012		2013
	RMB		RMB		RMB
Revenue sharing fees and content costs		6,750		109,273		444,065
Bandwidth costs		75,064		145,037		203,238
Salary and welfare		33,388		50,009		88,456
Business tax and surcharges		16,462		30,026		47,755
Depreciation and amortization		11,951		25,762		37,084
Payment handling costs		9,306		22,828		24,955
Shared-based compensation		15,449		8,407		9,860
Other costs		14,329		24,791		26,586


Total		182,699		416,133		881,999

Income tax

12 Months Ended

Dec. 31, 2013

Income tax

Income tax

16. Income tax

(i) Cayman Islands ("Cayman")

Under the current tax laws of Cayman Islands, the Company and its subsidiaries are not subject to tax on income or capital gains. Besides, upon payment of dividends by the Company to its shareholders, no Cayman Islands withholding tax will be imposed.

(ii) British Virgin Islands ("BVI")

Duowan BVI is exempt from income tax on its foreign-derived income in the BVI. There are no withholding taxes in the BVI.

(iii) Hong Kong profits tax

Entities incorporated in Hong Kong are subject to Hong Kong profits tax at a rate of 16.5% on the estimated assessable profit for the years ended December 31, 2011, 2012 and 2013.

(iv) PRC Enterprise Income Tax ("EIT")

The Company's subsidiaries, VIEs and VIE's subsidiary in China are governed by the Enterprise Income Tax Law ("EIT Law"), which became effective on January 1, 2008. Pursuant to the EIT Law and its implementation rules, enterprises in China are generally subjected to tax at a statutory rate of 25%. Certified High and New Technology Enterprises ("HNTE") are entitled to a favorable statutory tax rate of 15%, and qualified software enterprises can enjoy an income tax exemption for two years beginning with their first profitable year and a 50% tax reduction to the applicable tax rate for the subsequent three years.

The Group's PRC entities accrued for enterprise income tax as follows:

•

From 2011 to 2013, Guangzhou Huaduo accrued the EIT at a tax rate of 15% as a result of HNTE status.

•

Guangzhou Huanju Shidai reported tax loss from 2010 to 2013. On December 31, 2013, Guangzhou Huanju Shidai was granted the qualification as software enterprise and will enjoy the preferential tax beginning from its first profitable year.

•

Other PRC subsidiaries, VIE and VIE's subsidiary were subject to 25% EIT for the periods reported.

According to a policy promulgated by the State Tax Bureau of the PRC and effective from 2008 onwards, enterprises engage in research and development activities are entitled to claim 150% of the research and development expenses so incurred in a year as tax deductible expenses in determining its tax assessable profits for that year ("Super Deduction"). Certain subsidiaries and VIEs of the Group successfully claimed the Super Deduction in ascertaining the tax assessable profits for the periods reported.

In addition, according to the New EIT Law and its implementation rules, foreign enterprises, which have no establishment or place in the PRC but derive dividends, interest, rents, royalties and other income (including capital gains) from sources in the PRC shall be subject to PRC withholding tax ("WHT") at 10% (a further reduced WHT rate may be available according to the applicable double tax treaty or arrangement). The 10% WHT is applicable to any dividends to be distributed from the Group's PRC subsidiaries, VIEs and VIE's subsidiaries to the Group's oversea companies.

Aggregate undistributed earnings of the Company's subsidiaries located in the PRC that are available for distribution to the Company as of December 31, 2012 and 2013 are approximately RMB204,960 and RMB753,975, respectively. The undistributed earnings of the Company's subsidiaries, VIEs and VIE's subsidiary located in the PRC are considered to be indefinitely reinvested, because the Group does not have any present plan to pay any cash dividends on its common shares in the foreseeable future and intends to retain most of its available funds and any future earnings for use in the operation and expansion of its business. Accordingly, no deferred tax liability has been accrued for the Chinese dividend withholding taxes that would be payable upon the distribution of those amounts to the Company as of December 31, 2012 and 2013.

Composition of income tax expense

The current and deferred portions of income tax expense included in the consolidated statements of operations are as follows:

	For the year ended December 31,

	2011			2012			2013
	RMB			RMB			RMB
Current income tax expenses		(12,516	)		(48,357	)		(125,365	)
Deferred income tax benefits		11,173			19,316			35,414


Income tax expense for the year		(1,343	)		(29,041	)		(89,951	)

Reconciliation of the differences between statutory tax rate and the effective tax rate

The reconciliation of total tax expense computed by applying the respective statutory income tax rate to pre-tax (loss) income is as follows:

	For the year ended December 31,

	2011			2012			2013
	RMB			RMB			RMB
PRC Statutory income tax rate		(25.0%	)		(25.0%	)		(25.0%	)
Effect of preferential tax rate		8.4%			10.4%			10.5%
Effect of tax-exempt entities		(5.1%	)		0.2%			2.2%
Permanent differences⁽ⁱ⁾		32.5%			(13.9%	)		(4.0%	)
Change in valuation allowance		(7.8%	)		(2.0%	)		(3.0%	)
Effect of Super Deduction available to the Group		(4.9%	)		5.7%			3.4%
Adjustments of deferred tax for changes in tax rates		3.6%			—			—


Effective income tax rate		1.7%			(24.6%	)		(15.9%	)

(i): Permanent differences mainly arise from expenses not deductible for tax purposes including primarily share-based compensation costs and expenses incurred by subsidiaries and VIEs.

Deferred tax assets and liabilities

Deferred taxes were measured using the enacted tax rates for the periods in which they are expected to be reversed. The tax effects of temporary differences that give rise to the deferred tax asset balances as of December 31, 2012 and 2013 are as follows:

	December 31,

	2012			2013
	RMB			RMB
Deferred tax assets, current:
Deferred revenue		16,270			32,905
Allowance for doubtful accounts receivable, accrued expense and others not currently deductible for tax purposes		17,062			39,791
Valuation allowance⁽ⁱ⁾		(1,783	)		(5,775	)


Total current deferred tax assets, net		31,549			66,921


Deferred tax assets, non-current:
Tax loss carried forward		2,433			16,400
Deferred revenue		538			445
Impairment of an equity investment		45			180
Valuation allowance⁽ⁱ⁾		(2,433	)		(16,400	)


Total non-current deferred tax assets, net		583			625

(i): Valuation allowance is provided against deferred tax assets when the Group determines that it is more likely than not that the deferred tax assets will not be utilized in the future. In making such determination, the Group considered factors including future taxable income exclusive of reversing temporary differences and carry forwards. Valuation allowance was provided for net operating loss carry forward because it was more likely than not that such deferred tax assets will not be realized based on the Group's estimate of its future taxable income. If events occur in the future that allow the Group to realize more of its deferred income tax than the presently recorded amounts, an adjustment to the valuation allowances will result in a decrease in tax expense when those events occur.

Tax loss carry forwards

As of December 31, 2013, the Group had tax loss carry forwards of approximately RMB62,994, which can be carried forward to offset future taxable income. The net operating tax loss carry forwards will begin to expire as follows:

	Amount

	RMB
2014		3,184
2015		—
2016		3,405
2017		3,034
2018		53,371


Total		62,994

In accordance with PRC Tax Administration Law on the Levying and Collection of Taxes, the PRC tax authorities generally have up to five years to claw back underpaid tax plus penalties and interest for PRC entities' tax filings. In the case of tax evasion, which is not clearly defined in the law, there is no limitation on the tax years open for investigation. Accordingly, the PRC entities' tax years from 2009 to 2013 remain subject to examination by the tax authorities. There were no ongoing examinations by tax authorities as of December 31, 2013.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

+ References+ Details

Common shares	12 Months Ended
Common shares	Dec. 31, 2013
Common shares
Common shares	17. Common shares *Common Shares* In January 2011, Duowan BVI entered into a common share and warrant purchase agreement with an independent institutional investor with respect to the issuance and sale of 51,140,432 common shares at an aggregate consideration of US$50,000 and a warrant to purchase up to an additional 25,570,216 common shares for an aggregate purchase price of US$25,000 ("Series D Common Share Financing"). The issuance price of each common share is US$0.9777, of which US$0.0830 per share relates to the fair value of the warrant. The related issuance costs were RMB1,208. In July 2011, the institutional investor exercised the warrant to acquire 25,570,216 common shares of Duowan BVI. On October 31, 2012, several executives of the Company converted in aggregate 5,068,000 vested restricted shares into common shares. Upon the completion of the Company's IPO on November 21, 2012 (Note 1(c)), the Company's shares were divided into Class A common shares and Class B common shares, par value of US$0.00001. Holders of Class A common shares and Class B common shares have the same rights, except for voting rights and conversion rights. Holders of Class A common shares are entitled to one vote per share in all shareholders' meetings, while holders of Class B common shares are entitled to ten votes per share. Each Class B common share is convertible into one Class A common share at any time at the discretion of the Class B shareholders thereof, while Class A common shares are not convertible into Class B common shares under any circumstances. The impact of dividing Class A and Class B commons shares has been retroactively reflected in the Company's capital structure in the consolidated financial statements. As of December 31, 2011, nil Class A common shares and 4,640,575,690 Class B common shares had been authorized, nil Class A common shares and 543,340,914 Class B common shares had been issued and outstanding. As of December 31, 2012, 10,000,000,000 Class A common shares and 1,000,000,000 Class B common shares had been authorized, 179,400,000 Class A common shares and 907,833,224 Class B common shares had been issued and outstanding, respectively. During the year ended December 31, 2013, 21,256,900 Class A common shares were issued for the exercised share options, vested restricted shares and restricted share units, 422,001,838 Class B common shares were converted to Class A common shares. As of December 31, 2013, 10,000,000,000 Class A common shares and 1,000,000,000 Class B common shares had been authorized, 622,658,738 Class A common shares and 485,831,386 Class B common shares had been issued and outstanding, respectively.

- Definition

The entire disclosure for shareholders' equity comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income. Includes, but is not limited to, balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings, accumulated balance for each classification of other comprehensive income and amount of comprehensive income.

+ References

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+ Details

Convertible redeemable preferred shares

12 Months Ended

Dec. 31, 2013

Convertible redeemable preferred shares

Convertible redeemable preferred shares

18. Convertible redeemable preferred shares

During the First Reorganization, Duowan Limited issued 54,488,000 Series A convertible preferred shares ("Series A Preferred Shares") and warrant to a third party investor ("Series A Investor") in exchange for an aggregate purchase price of RMB7,720, or US$0.0184 per share. During the Second Reorganization in June 2008, Duowan BVI issued an additional 81,612,930 Series A convertible preferred shares to the Series A Investor for an aggregate purchase price of RMB13,722. The related issuance costs were RMB172.

In August 2008, Duowan BVI issued 102,073,860 Series B convertible redeemable preferred shares ("Series B Preferred Shares") for aggregate cash consideration of RMB34,232 and issuance costs of RMB278.

In November 2009, Duowan BVI issued 16,249,870 Series C-1 convertible redeemable preferred shares ("Series C-1 Preferred Shares") and 104,999,650 C-2 convertible redeemable preferred shares ("Series C-2 Preferred Shares", collectively with Series C-1 Preferred Shares, "Series C Preferred Shares"), for aggregate cash considerations of RMB8,875 and RMB71,684 respectively. Series C Preferred Shares issuance costs were RMB274.

Series A Preferred Shares, Series B Preferred Shares and Series C Preferred Shares are collectively referred to as the "Preferred Shares".

As of December 31, 2011, the Company has determined that the Preferred Shares should be classified as mezzanine equity since the Preferred Shares are contingently redeemable by the holders in the event that a qualified IPO has not occurred and the Preferred Shares have not been converted as of the redemption date.

The Company determined that there were no embedded derivatives requiring bifurcation as the economic characteristics and risks of the conversion feature embedded in derivative instrument are clearly and closely related to that of the convertible preferred shares, and the convertible and redeemable preferred shares are not readily convertible into cash as there is no market mechanism in place for trading its share.

As of December 31, 2011, the Preferred Shares comprised of the following:

Series	Issuance Date

A	December 1, 2006	54,488,000	0.0184	1,000	374,332
A	June 2, 2008	81,612,930	0.0245	1,975	560,681
B	August 8, 2008	102,073,860	0.0490	4,959	703,901
C-1	November 22, 2009	16,249,870	0.0800	1,300	112,556
C-2	November 22, 2009	104,999,650	0.1000	10,460	729,464

All Preferred Shares' par value is US$0.00001. The rights, preferences and privileges of the Preferred Shares are as follows:

Conversion

Each Preferred Share was convertible, at the option of the holders, at any time after the date of issuance of such preferred shares into such number of common shares according to a conversion price. Each share of Series A, Series B, Series C Preferred Shares was convertible into one common share and was subject to adjustments for certain events, including but not limited to additional equity securities issuance, share dividends, subdivisions, redemptions, combinations, or consolidation of common shares. The conversion price is also subject to adjustment in the event the Company issues additional common shares at a price per share that is less than such conversion price. In such case, the conversion price shall be reduced to adjust for dilution.

Each Preferred Share was automatically converted into common shares at the then effective conversion price with respect to such Preferred Share (i) at the closing of a Qualified IPO, or (ii) at the election of the majority Series A, Series B, and Series C Preferred Shares holders (each voting or consenting as a separate class). As of December 31, 2010, the Qualified IPO is defined as a firm-commitment public offering of common shares of the Company in the United States that has been registered under the Securities Act and on a recognized securities exchange such as NASDAQ or the New York Stock Exchange, or in a similar public offering of common shares in a jurisdiction and on a recognized securities exchange outside of the United States, including without limitation, the Hong Kong Stock Exchange, provided that (a) the market capitalization of the Company upon completion of such initial public offering shall be no less than US$400,000 and such public offering and the aggregate proceeds (before deduction of underwriting discounts and registration expenses) is approved by majority of the board of directors (including the affirmative consent of the majority of the Series A, Series B, and Series C Preferred Shares director), or (b) such public offering and the aggregate proceeds (before deduction of underwriting discounts and registration expenses) is approved by majority of the board of directors (including the affirmative consent of each of the Preferred Shares' directors), and provided further that such public offering is made at an equivalent price and yields equivalent offering proceeds and there is regulatory approval for such offering. Subsequent to the Series D Common Share Financing in January 2011, the Qualified IPO is defined as a firm-commitment public offering of common shares of the Company in the United States that has been registered under the Securities Act and on a recognized securities exchange such as NASDAQ or the New York Stock Exchange, or in a similar public offering of common shares in a jurisdiction and on a recognized securities exchange outside of the United States, including without limitation, the Hong Kong Stock Exchange, provided that (a) the market capitalization of the Company upon completion of such initial public offering shall be no less than US$1,500,000 and such public offering and the aggregate proceeds (before deduction of underwriting discounts and registration expenses) is approved by majority of the Board of Directors (including the affirmative consent of the majority of the Series A Director, the Series B Director, the Series C Director and the Series D director), or (b) such public offering and the aggregate proceeds (before deduction of underwriting discounts and registration expenses) is approved by majority of the Board of Directors (including the affirmative consent of each of the Series A Director, the Series B Director, the Series C Director and the Series D Director, if applicable), and provided further that such public offering is made at an equivalent price and yields equivalent offering proceeds and there is regulatory approval for such offering.

On September 19, 2012, the board of directors of the Company resolved to approve to raise additional capital through an underwritten initial public offering of its shares in the United States of America as a Qualified IPO.

Upon the completion of the IPO on November 21, 2012, each Preferred Share was automatically converted into one Class B common share. As a result, 359,424,310 Class B common shares were issued, and the balance of Preferred Shares was transferred to Class B common shares and additional paid-in capital on the same day.

Redemption Right

As of December 31, 2010, at any time after the date that is the earlier of i) the date of the occurrence of a Default Redemption Event, and ii) five years following the Series C-1 original issue date and Series C-2 original issue date, at the election of the majority of Series C holders, the Company shall redeem all or any lesser portion of its then outstanding Preferred Shares. A Default Redemption Event shall be deemed to occur if the Company's corporate structure as a whole, including without limitation the VIE documents, is invalidated or otherwise challenged by any PRC governmental authority, court or other official governmental body as a result of the application of or interpretation of the PRC law. In connection with the Series D Common Share Financing in January 2011, the Default Redemption Event was removed and the redemption date was changed to any time after June 30, 2015.

The redemption date above is subject to postponement until the Company meets the financial thresholds of having at least US$3,000 of cash or cash equivalents on the balance sheet or the Company has generated over US$1,000 in free cash flows in the preceding twelve months.

The redemption price of Series A Preferred Shares is equal to (i) the fair market value of the Series A Preferred Shares as of the redemption date, or (ii) 150% of the original issue price of Series A Preferred Shares, plus all declared or accrued but unpaid dividends up until the date of redemption, plus an amount that would give the holders of the Series A Preferred Shares an internal rate of return of no less than 10% per annum.

The redemption price of Series B Preferred Shares is equal to (i) the fair market value of the Series B Preferred Shares as of the redemption date, or (ii) 100% original issue price of Series B Preferred Shares, plus all declared or accrued but unpaid dividends up until the date of redemption, plus an amount that would give the holders of the Preferred Shares an internal rate of return of no less than 10%.

The redemption price of Series C Preferred Shares is equal to (i) the fair market value of the Series C Preferred Shares as of the redemption date, or (ii) 100% original issue price of Series C-1 or C-2 Preferred Shares, plus all declared or accrued but unpaid dividends up until the date of redemption, plus an amount that would give the holders of the Series C-1 or C-2 Preferred Shares an internal rate of return of no less than 10% per annum.

Modification

Upon its issuance, Series A Preferred Shares were classified as permanent equity and were not redeemable. In association with the issuance of Series B Preferred Shares in August 2008, Series A Preferred Shares were granted redemption at the option of the holders and drag-along rights and accordingly were reclassified as mezzanine equity of the Company. The Company concluded that the addition of the redemption and drag-along rights is a modification of the terms of the Series A Preferred Shares. The incremental value received by the Series A Preferred Shareholders amounted to RMB916 which was deemed to be a wealth transfer between the preferred shareholders and the common shareholders and was charged to additional paid-in capital.

Upon its issuance, Series B Preferred Shares had a redemption right beginning on or after the seventh anniversary following the issuance of Series B Preferred Shares. In association of the issuance of Series C Preferred Shares, the redemption right for Series A and Series B Preferred Shares and drag along rights were amended. The Company concluded amendment of the redemption and drag-along rights is a modification of the terms of the Series A and Series B Preferred Shares. The incremental value received by Series A and Series B Preferred Shareholders amounted to RMB19 and RMB176, respectively, which were deemed to be a wealth transfer between the preferred shareholders and the common shareholders and were charged to additional paid-in capital.

Accretion (Decretion)

Due to the redemption features described above, the Company classified the Preferred Shares in the mezzanine equity section of the consolidated balance sheets. The Company recognized the changes in the redemption value immediately as they occurred and adjusted the carrying amount of the Preferred Shares to equal the redemption value at the end of each reporting period. The fair market values of the Preferred Shares as of December 31, 2010 and 2011 were greater than the redemption value as of December 31, 2009 and 2010, while the fair market value of the Preferred Shares prior to conversion on November 21, 2012 was lower than the redemption value as of December 31, 2011. As a result, the Company recorded accretion (decretion) to the redemption value immediately and adjusted the carrying amount of the instrument to equal to the redemption value at the end of each reporting period. The accretion was recorded against retained earnings, or in the absence of retained earnings, by charging against additional paid-in capital. Once additional paid-in capital has been exhausted, additional charges were recorded by increasing accumulated deficit. The decretion was recorded against the previous accretion originally recognized in retained earnings or additional paid-in capital, where applicable.

The following table sets forth the changes of each of the convertible redeemable preferred shares for years ended December 31, 2011, 2012 and 2013:

Series A Preferred Shares

	For the year ended December 31,

	2011		2012			2013
	RMB		RMB			RMB
Beginning balance		846,752		935,013			—
Accretion (decretion) to redemption value		88,261		(485,517	)		—
Conversion of convertible redeemable preferred shares into Class B common shares		—		(449,496	)		—


Ending balance		935,013		—			—

Series B Preferred Shares

	For the year ended December 31,

	2011		2012			2013
	RMB		RMB			RMB
Beginning balance		639,799		703,901			—
Accretion (decretion) to redemption value		64,102		(366,785	)		—
Conversion of convertible redeemable preferred shares into Class B common shares		—		(337,116	)		—


Ending balance		703,901		—			—

Series C Preferred Shares

	For the year ended December 31,

	2011		2012			2013
	RMB		RMB			RMB
Beginning balance		770,720		842,020			—
Accretion (decretion) to redeemable value		71,300		(441,573	)		—
Conversion of convertible redeemable preferred shares into Class B common shares		—		(400,447	)		—


Ending balance		842,020		—			—

Prior to the completion of the IPO, the Company engaged an independent valuation firm to assist them in determining the fair values of the preferred and common shares which were estimated as of the date of issuance and at each financial statement reporting date using the "Discounted Cash Flow Method" , the "Guideline Transaction Method" and the "Backsolve Method", where methodologies, approaches and assumptions are consistent with the current working draft of the American Institute of Certified Public Accountants practice aid Valuation of Privately Held Company Equity Securities Issued as Compensation. The Guideline Transaction Method is a form of market approach based on the enterprise value to revenue multiples of the Group's own equity transactions close to the valuation date. The Backsolve Method is a form of market approach to valuation that derives the implied equity value for one type of equity security (e.g. common equity) from a contemporaneous transaction involving another type of equity security (e.g., preferred share). The Discounted Cash Flow Method, a form of income approach, estimates the fair value based on projected cash flows at each of the valuation dates. The followings are assumptions in the Discounted Cash Flow Method:



Risk-free interest rate	2.53	%
Volatility	66.1	%
Dividend yield	—
Discount rate	16	%

The Company estimated the risk-free interest rate based on yield-to-maturities in continuous compounding of the China Government Bond with the time to maturities similar to the Preferred Shares. The Company estimated volatility at the dates of appraisal based on average of historical volatilities of the comparable companies in the same industry. The Company has no history or expectation of paying dividend on the Preferred Shares. Discount rate is estimated by weighted average cost of capital as at each appraisal date. In addition to the above assumptions adopted, the Company's projections of future performance were also factored into the determination of the fair value of each Preferred Share.

Liquidity Preference

In the event of any liquidation, dissolution or winding up of the Company or any deemed liquidation event (e.g., change in control), the holders of Series B Preferred Shares and Series C Preferred Shares were entitled to receive an amount per share equal to 100% of the original issuance price plus all dividends accrued, or declared and unpaid. Series A Preferred Shares were entitled to receive an amount per share equal to 150% of the original issuance price plus all declared or accrued but unpaid dividends.

If the assets and funds distributed among the holders are insufficient to permit the payment of the full preferential amounts, then the holders of Series C Preferred Shares shall be entitled to be paid first, followed in sequence by Series B Preferred Shares, Series A Preferred Shares and common shares. After payment of the full amounts from above, the remaining assets of the Company available for distribution shall be distributed ratably among the holders of preferred shares and common shares in proportion to the number of outstanding shares held by each holder on an as converted basis.

Dividends

Each holder of Preferred Shares was entitled to receive dividends when and if declared by the Board of Directors of the Company. As long as the Preferred Shares were outstanding, the Company might not pay any dividend to common shareholders until all dividends declared and payable to the preferred shareholders had been paid. In the event the Company shall declare a dividend to the holders of common shares, then in each such case, the holders of the Preferred Shares shall be entitled to a proportionate share of such dividend on an as-converted basis.

Voting rights

Each Preferred Share conveys the right to the shareholder of one vote for each common share upon conversion.

Share-based compensation

12 Months Ended

Dec. 31, 2013

Share-based compensation

Share-based compensation

19. Share-based compensation

(a) Share options

Pre-2009 Scheme Options

Grant of options

Before the adoption of the Employee Equity Incentive Scheme (the "2009 Incentive Scheme"), 12,705,700 and 8,499,050 share options were granted to employees through individually signed share option agreements, to acquire common shares of Duowan BVI on a one-to-one basis on January 1, 2008 and 2009 respectively. In addition, on January 1, 2008, 3,832,290 share options were granted to one non-employee for the provision of consulting services to the Group (collectively defined as "Pre-2009 Scheme Options").

Vesting of options

These Pre-2009 Scheme Options will vest over a four years' service period, with 25% of the options vesting after the first anniversary of the vesting inception date and the remaining 75% in six equal installments over the following 36 months. The options may be exercised provided that both the service conditions and a performance condition are met. The performance condition is defined to be i) an initial public offering, ii) completion of a financing meeting certain criteria, iii) an internal reorganization, or iv) a voluntary winding up of Duowan BVI. The performance condition that is tied to completion of a financing fulfilling certain criteria was met in June 2008 or November 2009.

The following table summarizes the activities of the Pre-2009 Scheme Options for employees and non-employee for the years ended December 31, 2011, 2012 and 2013:



Outstanding, January 1, 2011	19,742,590		0.0056	7.39	18,372
Exercised/Repurchased⁽¹⁾	(1,853,055	)	0.0061


Outstanding, December 31, 2011⁽²⁾	17,889,535		0.0055	6.37	19,366
Forfeited	(19,110	)	0.0067	6.25


Outstanding, December 31, 2012	17,870,425		0.0055	5.37	12,642
Exercised	(4,648,420	)	0.0045	4.30


Outstanding, vested and exercisable December 31, 2013	13,222,005		0.0059	4.40	33,162

(1): In connection with the Series D Common Share Financing (Note 17) in January 2011, certain employees and the non-employee were given the opportunity to cash-settle their vested options. The repurchase price of each vested option/share was the difference between the stated exercise price of the Pre-2009 Scheme Option and US$0.9777, which was the per share issuance price of common shares issued to the new investor. A total of 1,853,055 Pre-2009 Scheme Options were exercised/repurchased by Duowan BVI for cash consideration of RMB11,701. The underlying common shares were cancelled immediately after the repurchase (the "Second Repurchase"). Similar offer was made by Duowan BVI to the non-employee holding the Pre-2009 Scheme Options but that non-employee did not take up the offer.
(2): On September 15, 2011, the board of directors of the Company resolved not to undertake any repurchases of vested or unvested share-based compensation awards, except under those conditions specified in the relevant award scheme and grant documents. In addition, any proposed repurchase of vested or unvested share-based compensation awards should be approved by the majority votes of the board of directors. Such intention of the Company was specifically communicated to all employees with or without the awards. All the employees with vested or unvested awards also confirmed such understanding by a written confirmation. Accordingly, the classification of the liability-classified awards changed back to be equity-classified, and the related liability had been reclassified to additional paid-in capital on the modification date.

Forfeitures are estimated at the time of grant. If necessary, forfeitures are revised in subsequent periods if actual forfeitures differ from those estimates.

The aggregate intrinsic value in the table above represents the difference between the Company's common shares as of December 31, 2011, 2012 and 2013 and the exercise price.

Prior to the completion of the IPO, the Binomial option pricing model is used to determine the fair value of the share options granted to employees and the non-employee. The fair values of share options granted or remeasured during the year ended December 31, 2011 was estimated using the following assumptions:

Pre-2009 Scheme Options granted to employees and a non-employee:

		2011

Risk-free interest rate⁽¹⁾		3.34%-4.01%
Expected term⁽²⁾		6-8 years
Volatility rate⁽³⁾		53.06%-55.34%
Dividend yield⁽⁴⁾		—

(1): The risk-free interest rate of periods within the contractual life of the share option is based on the China Government Bond yield as at the valuation dates.
(2): The expected term is the contract life of the option.
(3): Expected volatility is estimated based on the average of historical volatilities of the comparable companies in the same industry as at the valuation dates.
(4): Duowan BVI and the Company have no history or expectation of paying dividend on its common shares. The expected dividend yield was estimated based on the Company's expected dividend policy over the expected term of the option.

Upon the completion of the IPO, the fair value of share options granted to a non-employee with nil exercise price was assessed to be equivalent to the fair value of the Company's common share. These share options were remeasured at the stock price of the Company's common share as of December 31, 2012 and 2013.

The total intrinsic value of options exercised during the year ended December 31, 2011, 2012 and 2013 amounted to RMB11,912, nil and RMB64,195, respectively. For the years ended December 31, 2011, 2012 and 2013, the Company recorded share-based compensation of RMB25,683, share-based benefit of RMB89 and share-based compensation of RMB14,004, respectively, using the graded-vesting attribution method for employees and non-employee.

As of December 31, 2013, there was no unrecognized compensation cost and expense related to Pre-2009 Scheme Options granted to employees and non-employee.

(b) Restricted shares

Since January 1, 2010, Duowan BVI granted 61,250,677 restricted shares to employees and 100,000 restricted shares to a non-employee pursuant to the 2009 Incentive Scheme. As of December 31, 2012, the restricted shares granted to the non-employee were fully vested.

Vesting of restricted shares

The restricted shares have vesting conditions and will vest 50% after 24 months of the grant date and the remaining 50% will vest in two equal installments over the next 24 months. Under the restricted shares agreement, no shares may be sold or transferred prior to the occurrence of an exit event, as defined in the respective restricted share agreements as: i) a listing on any recognized stock exchange, ii) a sale by Duowan BVI of all or substantially all of its assets, iii) a sale of all of the issued capital of Duowan BVI, or iv) passing for court order of winding up of Duowan BVI.

If the employee terminates employment, the service vested portion of the restricted shares may be subject to: (i) repurchase (subject to Company's sole discretion) by Duowan BVI at fair value of common shares of Duowan BVI which is assessed by the Company with the assistance of an independent valuation firm; or (ii) be held by a person who is an existing employee of the Group and is designated by the leaving restricted share holder according to a properly signed escrow agreement to hold such shares for and on his/her behalf. If the leaving employee fails to deliver a properly signed agreement to Duowan BVI within 30 days from receipt of the notification from Duowan BVI, such service vested shares shall automatically lapse and expire.

The following table summarizes the restricted shares activity for the years ended December 31, 2011, 2012 and 2013:



Outstanding, January 1, 2011	48,486,036		0.2936
Granted	10,846,800		0.9362
Forfeited	(2,726,024	)	0.3917
Vested	(13,321,711	)	0.1636


Outstanding, December 31, 2011	43,285,101		0.4885
Forfeited	(3,673,580	)	0.4945
Vested	(21,380,720	)	0.4864


Outstanding, December 31, 2012	18,230,801		0.4898
Forfeited	(1,581,789	)	0.8726
Vested	(11,975,287	)	0.3906


Outstanding, December 31, 2013	4,673,725		0.6144


Expected to vest at December 31, 2013	4,449,366		0.6120

Forfeitures are estimated at the time of grant. If necessary, forfeitures are revised in subsequent periods if actual forfeitures differ from those estimates.

For the years ended December 31, 2011, 2012 and 2013, the Company recorded share-based compensation of RMB57,805, RMB36,371 and RMB7,300, respectively, using the graded-vesting method for employees and non-employee.

As of December 31, 2013, total unrecognized compensation expense relating to the restricted shares was RMB5,873. The expense is expected to be recognized over a weighted average period of 0.54 years using the graded vesting attribution method.

(c) Share-based awards granted to CEO and Chairman of the Company

On February 23, 2010, the CEO and the Chairman of the Company, also directors and shareholders were granted 13,369,813 and 29,678,483 restricted shares, respectively. The Chairman's shares have a service condition that vest over a four year period (50% after the second anniversary and 25% each year thereafter). Both the CEO's and the Chairman's shares are subject to a performance condition which relates to the number of peak concurrent users on the YY Client. Such performance condition was met as of December 31, 2010.

Pursuant to the provisions stipulated in the grant document relating to these restricted shares grant, upon the occurrence of an Acceleration Event, the restricted shares granted to the Chairman would also become fully vested. An "Accelerated Event" is defined as (i) a Listing, (ii) a sale of all or substantially all of the issued share capital of Duowan BVI, (iii) a sale by Duowan BVI of all or substantially all of its assets, (iv) the passing of an effective resolution or the making of an order of a competent court for the winding up of Duowan BVI.

The following table summarizes information regarding the restricted shares granted to the CEO and the Chairman:



Outstanding, January 1, 2011	29,678,483		0.1875


Outstanding, December 31, 2011	29,678,483		0.1875
Vested	(29,678,483	)	0.1875


Outstanding, December 31, 2012 and 2013	—

The fair value of the share-based awards above was determined at the respective grant dates by the Company with the assistance of an independent valuation firm.

The Company recognized these awards as employee share-based compensation awards using fair value of the awards on the grant date. As of December 31, 2010, the performance condition was met. The compensation expense for the CEO's restricted shares was fully recognized and the compensation expense for the Chairman's restricted shares is recognized over the requisite service period using the graded vesting method. Upon the completion of the IPO, the restricted shares granted to the Chairman were fully vested and all remaining compensation expenses were recognized immediately.

The total fair value of restricted shares vested during the year ended December 31, 2011, 2012 and 2013 amounted to nil, RMB35,924 and nil, respectively.

Share-based compensation expenses related to the awards granted to the CEO and Chairman of RMB14,143, RMB9,624 and nil were recognized in general and administrative expenses in the consolidated statements of operations for the years ended December 31, 2011, 2012 and 2013.

As of December 31, 2013, there was no unrecognized compensation cost and expense related to the restricted shares.

(d) Share-based awards for former NeoTasks employees

On December 5, 2008, Duowan BVI granted the two founders of NeoTasks, 26,873,070 warrants to acquire common shares of Duowan BVI in connection with the NeoTasks acquisition for post-combination services at an exercise price of US$0. In October 2009, the Company converted the warrants into restricted shares having the same rights and vesting conditions as the original warrant grants. Accordingly, no incremental charge was recognized in the conversion. The shares were issued to the holders and legally registered in July 2010.

The awards shall vest over the earlier of (i) a three-year period, with one-third of the shares vesting annually or (ii) upon any sale, merger, amalgamation, liquidation or listing of Duowan BVI or the sale by Duowan BVI of all or substantially all of its assets (the "Awards to NeoTasks Founders").

The following table summarizes information regarding the share-based award granted:



Outstanding, January 1, 2011	8,957,690
Vested	(8,957,690	)


Outstanding, December 31, 2011, 2012 and 2013	—

(1): In connection with the First Repurchase occurred in November 2009, Duowan BVI repurchased a portion of their vested restricted shares by utilizing a portion of the proceeds obtained from the Series C preferred shares issuance. The negotiation and execution of the First Repurchase had formed an expectation to the holders of Awards to NeoTasks Founders that it was a practice of Duowan BVI to repurchase the vested restricted shares held by them. The Awards to NeoTasks Founders were deemed to be tainted and they were no longer equity-classified awards but liabilities-classified awards effective from November 2009. The awards would be re-measured at the end of each reporting period until either the repurchase obligation was extinguished or the awards holders were exposed to fluctuation of the market value of the shares for a period of at least six months, or the awards are settled, cancelled or expire unexercised.

The fair value of the restricted shares above was determined at the grant date. Effective from the re-designation of the award as liability-classified, it was re-measured at the end of each reporting date by the Company with the assistance of an independent valuation firm. The change in fair value was recognized in the consolidated statements of operations. After the award was changed back to equity-classified awards, it was measured based on the fair value of the awards on September 15, 2011, and the expenses to be recognized over the remaining requisite service period using the graded-vesting attribution method.

Share-based compensation expenses related to the above share-based award of RMB27,726 were recognized in general and administrative expenses in the consolidated statements of operations for the year ended December 31, 2011.

As of December 31, 2011, the compensation costs related to restricted shares for NeoTasks acquisition had been fully recognized.

(e) Restricted Share Units

On September 16, 2011, the Board of the Directors of the Company approved the 2011 Share Incentive Plan, which permits the grant of share options, restricted shares and restricted share units of up to 43,000,000 shares, to any qualified persons, as determined by the Board of the Directors of the Company. On the same date, the Company granted 9,097,000 restricted share units to employees pursuant to the 2011 Share Incentive Plan, that are subject to vesting over a four to five years' period. During the year ended December 31, 2012, the Company granted 18,295,221 restricted share units to employees pursuant to the 2011 Share Incentive Plan, which are subject to vesting over a two to four years' period. No restricted share units were granted to non-employees up to December 31, 2012.

In October 2012, the Board of Directors of the Company resolved that the maximum aggregate number of Class A common shares which may be issued pursuant to all awards under the 2011 Incentive Scheme shall be 43,000,000 plus an annual increase of 20,000,000 on the first day of each fiscal year, beginning from 2013, or such lesser amount of Class A common shares as determined by the Board of Directors of the Company.

During the year ended December 31, 2013, the Company granted 29,917,989 restricted share units to employees and 48,000 restricted share units to non-employee pursuant to the 2011 Share Incentive Plan, which are subject to vesting over a three to five years' period.

The following table summarizes the restricted share units activity for the years ended December 31, 2011, 2012 and 2013:



Outstanding, January 1, 2011	—
Granted	9,097,000		1.0630
Forfeited	(100,700	)	1.0630


Outstanding, December 31, 2011	8,996,300		1.0630
Granted	18,295,221		1.0324
Forfeited	(595,900	)	1.0876


Outstanding, December 31, 2012	26,695,621		1.0415
Granted	29,965,989		0.9338
Forfeited	(3,522,992	)	1.0699
Vested	(8,836,018	)	1.0429


Outstanding, December 31, 2013	44,302,600		0.9639


Expected to vest at December 31, 2013	41,581,339		0.9654

For the years ended December 31, 2011, 2012 and 2013, the Company recorded share-based compensation of RMB9,644, RMB54,445 and RMB95,792, using the graded-vesting attribution method.

As of December 31, 2013, total unrecognized compensation expense relating to the restricted share units was RMB144,499. The expense is expected to be recognized over a weighted average period of 1.36 years using the graded-vesting attribution method.

(f) Movements of equity-classified and liability-classified awards

The table below shows the movements and details of various equity-classified and liability-classified awards granted by the Company to its employees and non-employee for the years ended December 31, 2011, 2012 and 2013:

	Equity-classified Awards (RMB)													Liability-classified Awards (RMB)

	Pre-2009 Scheme options			2009 Incentive Scheme— restricted shares		2011 Incentive Scheme— restricted share units		Share-based awards to CEO and Chairman		Awards to NeoTasks Founders		Sub-total		Pre-2009 Scheme options			Awards to NeoTasks Founders			Sub-total			Total
Balance as of January 1, 2011		—			24,525		—		30,808		—		55,333		109,035			94,089			203,124			258,457
Share-based compensation expenses		2,219			57,805		9,644		14,143		3,359		87,170		23,464			24,367			47,831			135,001
Exercised/Repurchased		—			—		—		—		—		—		(11,701	)		—			(11,701	)		(11,701	)
Reclassifications
—From liability-awards to common share*		—			—		—		—		—		—		—			(57,692	)		(57,692	)		(57,692	)
—From liability-awards to equity awards**		116,328			—		—		—		57,602		173,930		(116,328	)		(57,602	)		(173,930	)		—
Foreign currency translation adjustment		—			—		—		—		—		—		(4,470	)		(3,162	)		(7,632	)		(7,632	)


Balance as of December 31, 2011		118,547			82,330		9,644		44,951		60,961		316,433		—			—			—			316,433




Balance as of January 1, 2012		118,547			82,330		9,644		44,951		60,961		316,433		—			—			—			316,433
Share-based compensation expenses		(89	)		36,371		54,445		9,624		—		100,351		—			—			—			100,351


Balance as of December 31, 2012		118,458			118,701		64,089		54,575		60,961		416,784		—			—			—			416,784




Balance as of January 1, 2013		118,458			118,701		64,089		54,575		60,961		416,784		—			—			—			416,784
Share-based compensation expenses		14,004			7,300		95,792		—		—		117,096		—			—			—			117,096


Balance as of December 31, 2013		132,462			126,001		159,881		54,575		60,961		533,880		—			—			—			533,880

*: During the year ended December 31, 2011, the restricted shares to NeoTasks founders were held by NeoTasks Founders for more than six months, therefore, the related awards amounting to RMB57,692 were reclassified back to common share.
**: As detailed in Note 19(a) and (d), the share options and the restricted shares to NeoTasks founders were reclassified from liability-classified awards to equity-classified awards in September 2011, accordingly.

- Definition

The entire disclosure for compensation-related costs for equity-based compensation, which may include disclosure of policies, compensation plan details, allocation of equity compensation, incentive distributions, equity-based arrangements to obtain goods and services, deferred compensation arrangements, employee stock ownership plan details and employee stock purchase plan details.

+ References+ Details

Basic and diluted net (loss) income per share

12 Months Ended

Dec. 31, 2013

Basic and diluted net (loss) income per share

Basic and diluted net (loss) income per share

20. Basic and diluted net (loss) income per share

Basic and diluted net (loss) income per share for the years ended December 31, 2011, 2012 and 2013 are calculated as follows:

	For the year ended December 31,

	2011			2012			2013
	RMB			RMB			RMB
Numerator:
Net (loss) income attributable to the Company		(83,156	)		89,177			477,727
(Accretion) decretion to convertible redeemable preferred shares redemption value		(223,663	)		1,293,875			—
Allocation of net income to participating preferred shareholders		—			(478,754	)		—


Numerator of basic net (loss) income per share		(306,819	)		904,298			477,727
Dilutive effect of preferred shares		—			(815,121	)		—


Numerator for diluted (loss) income per share		(306,819	)		89,177			477,727




Denominator:
Denominator for basic calculation—weighted average number of Class A and Class B common shares outstanding		485,883,845			604,703,810			1,122,475,688
Dilutive effect of preferred shares		—			320,142,965			—
Dilutive effect of share options		—			17,782,885			16,362,048
Dilutive effect of restricted shares		—			30,594,877			14,400,670
Dilutive effect of restricted share units		—			4,802,491			27,882,891
Dilutive effect of share-based awards granted to CEO and Chairman		—			14,441,808			—


Denominator for diluted calculation		485,883,845			992,468,836			1,181,121,297




Basic net (loss) income per Class A and Class B common share		(0.63	)		1.50			0.43
Diluted net (loss) income per Class A and Class B common share		(0.63	)		0.09			0.40
Basic net (loss) income per ADS*		(12.63	)		29.91			8.51
Diluted net (loss) income per ADS*		(12.63	)		1.80			8.09

*: The Company was listed on November 21, 2012 with issuance of a total of 8,970,000 ADS at a public offering price of US$10.50 per ADS. Each ADS represents 20 Class A common shares. The net (loss) income per ADS for the years ended December 31, 2011, 2012 and 2013 were calculated using the same conversion ratio assuming the ADSs had been in existence during these periods.

The Company's preferred shares are participating securities and as such would be included in the calculation of basic earnings per share under the two-class method. According to the contractual terms of the preferred shares, the preferred shares do not have a contractual obligation to share in the losses of the Company. Therefore, no loss was allocated to the preferred shares in the computation of basic net loss per share for the year ended December 31, 2011. Net income was allocated to the preferred shares in the computation of basic net income per share for the year ended December 31, 2012.

The Preferred Shares, share-based awards for former NeoTasks employees, the share-based awards granted to the CEO and Chairman, share option, restricted shares, restricted share units and warrants to an independent institutional investor were excluded from the computation of diluted net loss per common share for the year ended December 31, 2011 because including them would have had an anti-dilutive effect. The following table summarizes information regarding weighted average of common shares equivalents for the year ended December 31, 2011:

		For the year ended December 31, 2011

Preferred shares—weighted average			359,424,310
Share-based awards for NeoTasks acquisition—weighted average			8,319,608
Share-based awards granted to CEO and Chairman—weighted average			29,678,483
Share options—weighted average			18,488,604
Restricted shares—weighted average			54,045,124
Restricted share units—weighted average			2,625,039
Warrants to an independent institutional investor—weighted average			12,609,970

- Definition

The entire disclosure for earnings per share.

+ References+ Details

Related party transactions

12 Months Ended

Dec. 31, 2013

Related party transactions

Related party transactions

21. Related party transactions

The table below sets forth the related parties and their relationships with the Group:

Related Party		Relationship with the Group

Zhuhai Daren Computer Technology Company Limited ("Zhuhai Daren")		Equity investment
Guangzhou Shanghang Information Technical Co., Ltd. ("Shanghang")		Significant influence exercised by the Chairman
Kingsoft Corporation ("Kingsoft")		Significant influence exercised by the Chairman
Xiaomi Corporation ("Xiaomi")		Significant influence exercised by the Chairman
Zhuhai Lequ Technology Co., Ltd. ("Zhuhai Lequ")		Equity investment
Agora, Inc.⁽¹⁾		Controlled by the director and the chairman of technology committee of the Group

(1): In December 2013, the Group made a minority interest investment to form a new company, Agora Inc., with the director and the chairman of technology committee of the Group and other strategic investors.

During the years ended December 31, 2011, 2012 and 2013, significant related party transactions were as follows:

	For the year ended December 31,

	2011		2012		2013
	RMB		RMB		RMB
Online games revenue sharing from Zhuhai Daren		4,451		7,547		24,452
Bandwidth service provided by Shanghang		21,985		11,776		21,272
Purchase of intangible assets from Kingsoft		—		—		6,010
Online games revenue sharing from Zhuhai Lequ		—		—		5,076
Advertising revenue from Xiaomi		—		—		1,154
Repayment of interest-free loan from Zhuhai Lequ		—		500		1,000
Membership subscription fee revenue from Xiaomi		—		227		—
Interest-free loan to Zhuhai Daren		500		—		—
Repayment of interest-free loan from Zhuhai Daren		—		2,000		—
Interest-free loan to Zhuhai Lequ		—		1,200		—
Disposal of a cost investment to the Chairman and Co-founder, who is also a director of the Company		—		1,000		—
Disposal of an equity investment to Xiaomi		—		2,000		—

As of December 31, 2012 and 2013, the amounts due from/to related parties were as follows:

	December 31,

	2012		2013
	RMB		RMB
Amount due from a related party
Other receivables from Zhuhai Lequ		1,073		73


Total		1,073		73




Amounts due to related parties
Accounts payable to Zhuhai Daren		2,362		1,479
Other payables to Shanghang		242		822
Accounts payable to Zhuhai Lequ		—		339


Total		2,604		2,640

The other receivables/payables from/to related parties are unsecured, interest-free and payable on demand.

- Definition

The entire disclosure for related party transactions. Examples of related party transactions include transactions between (a) a parent company and its subsidiary; (b) subsidiaries of a common parent; (c) and entity and its principal owners; and (d) affiliates.

+ References+ Details

Fair value measurements	12 Months Ended
Fair value measurements	Dec. 31, 2013
Fair value measurements
Fair value measurements	22. Fair value measurements Fair value reflects the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required or permitted to be recorded at fair value, the Group considers the principal or most advantageous market in which it would transact and considers assumptions that market participants would use when pricing the assets or liabilities. The Group applies a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. A financial instrument's categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. This guidance specifies a hierarchy of valuation techniques, which is based on whether the inputs into the valuation technique are observable or unobservable. The hierarchy is as follows: Level 1—Valuation techniques in which all significant inputs are unadjusted quoted prices from active markets for assets or liabilities that are identical to the assets or liabilities being measured. Level 2—Valuation techniques in which significant inputs include quoted prices from active markets for assets or liabilities that are similar to the assets or liabilities being measured and/or quoted prices for assets or liabilities that are identical or similar to the assets or liabilities being measured from markets that are not active. Also, model-derived valuations in which all significant inputs and significant value drivers are observable in active markets are Level 2 valuation techniques. Level 3—Valuation techniques in which one or more significant inputs or significant value drivers are unobservable. Unobservable inputs are valuation technique inputs that reflect the Group's own assumptions about the assumptions that market participants would use in pricing an asset or liability. The fair value guidance describes three main approaches to measure 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 asset. When available, the Group uses quoted market prices to determine the fair value of an asset or liability. If quoted market prices are not available, the Group will measure fair value using valuation techniques that use, when possible, current market-based or independently sourced market parameters, such as interest rates and currency rates. The Group did not have any financial instruments that were required to be measured at fair value on a recurring basis as of December 31, 2012 and 2013. The Group's financial instruments consist principally of cash, short-term deposits, accounts receivable, amounts due to/from related parties, accounts payable and certain accrued expenses. The recorded values of cash, accounts receivable, amounts due to/from related parties, accounts payable and certain accrued expenses are recorded at cost which approximates fair value.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References+ Details

Commitments and contingencies

12 Months Ended

Dec. 31, 2013

Commitments and contingencies

Commitments and contingencies

23. Commitments and contingencies

(a) Operating lease commitments

The Group leases facilities in the PRC under non-cancellable operating leases expiring on different dates. Payments under operating leases are expensed on a straight-line basis over the periods of the respective leases.

Total office rental expenses under all operating leases were RMB6,361, RMB16,670 and RMB19,423 for the years ended December 31, 2011, 2012 and 2013, respectively.

As of December 31, 2013, future minimum payments under non-cancellable operating leases consist of the following:

	Office rental

	RMB
2014		16,919
2015		15,809


		32,728

(b) Capital commitment

As of December 31, 2013, the Group did not have any capital commitment.

(c) Litigation

The Group is not currently a party to, nor is aware of, any legal proceeding, investigation or claim which individually or in the aggregate is likely to have a material adverse effect on the Group's business, financial condition, results or operations, or cash flows. The Group did not record any legal contingencies as of December 31, 2013.

- Definition

The entire disclosure for commitments and contingencies.

+ References+ Details

Subsequent events	12 Months Ended
Subsequent events	Dec. 31, 2013
Subsequent events
Subsequent events	24. Subsequent events In February 2014, The Group has initiated a lawsuit against one of the Group's advertisement agents, claiming for the unpaid advertisement fee and liquidated damages for late payment. Management believed that the lawsuit did not have significant impact to the Group's financial statements as of December 31, 2013.

Restricted net assets	12 Months Ended
Restricted net assets	Dec. 31, 2013
Restricted net assets
Restricted net assets	25. Restricted net assets Relevant PRC laws and regulations permit payments of dividends by the Group's subsidiaries and the VIEs and VIE's subsidiary incorporated in the PRC only out of their retained earnings, if any, as determined in accordance with PRC accounting standards and regulations. In addition, the Company's subsidiaries and the VIEs and VIE's subsidiary in the PRC are required to annually appropriate 10% of their net after-tax income to the statutory general reserve fund prior to payment of any dividends, unless such reserve funds have reached 50% of their respective registered capital. As a result of these and other restrictions under PRC laws and regulations, the Group's subsidiaries and the VIEs and VIE's subsidiary incorporated in the PRC are restricted in their ability to transfer a portion of their net assets to the Company either in the form of dividends, loans or advances, which restricted portion as calculated under US GAAP amounted to approximately RMB311,399 and RMB303,366 as of December 31, 2012 and 2013, respectively. There are no differences between US GAAP and PRC accounting standards in connection with the reported net assets of the legally owned subsidiaries in the PRC and the VIEs and VIE's subsidiary. Even though the Company currently does not require any such dividends, loans or advances from the PRC entities for working capital and other funding purposes, the Company may in the future require additional cash resources from them due to changes in business conditions, to fund future acquisitions and development, or merely to declare and pay dividends or distributions to our shareholders. Except for the above, there is no other restriction on use of proceeds generated by the Group's subsidiaries and the VIEs and VIE's subsidiary to satisfy any obligations of the Company. The Company performed a test on the restricted net assets of consolidated subsidiaries and VIEs in accordance with Securities and Exchange Commission Regulation S-X Rule 4-08 (e) (3), "General Notes to Financial Statements" and concluded that the restricted net assets did not exceed 25% of the consolidated net assets of the Company as of December 31, 2013 and the condensed financial information of the Company are not required to be presented.

Principal accounting policies (Policies)

12 Months Ended

Dec. 31, 2013

Principal accounting policies

Basis of presentation

(a) Basis of presentation

The consolidated financial statements have been prepared on a historical cost basis to reflect the financial position and results of operations of the Group in accordance with the US GAAP.

Consolidation

(b) Consolidation

Use of estimates

(c) Use of estimates

Foreign currency translation

(d) Foreign currency translation

Convenience translation

(e) Convenience translation

Fair value of financial instruments

(f) Fair value of financial instruments

Cash and cash equivalents

(g) Cash and cash equivalents

- i)
  
  Readily convertible to known amounts of cash throughout the maturity period;
  
  ii)
  
  So near their maturity that they present insignificant risk of changes in value because of changes in interest rates.

Short-term deposits

(h) Short-term deposits

Accounts receivable, net

(i) Accounts receivable, net

Equity investment

(j) Equity investment

Cost investment

(k) Cost investment

Property and equipment

(l) Property and equipment

	Estimated useful lives	Residual rate

Servers, computers and equipment	3 years	0%-5%
Furniture, fixture and office equipment	5 years	0%-5%
Motor vehicles	4 years	5%
Leasehold improvement	Shorter of lease term or 5 years	—

Business combinations

(m) Business combinations

Intangible assets, net

(n) Intangible assets, net

		Estimated useful lives

Software			3-5 years
Technology			5 years
Domain name			15 years

Impairment of long-lived assets

(o) Impairment of long-lived assets

Goodwill

(p) Goodwill

Goodwill represents the excess of the purchase price over the amounts assigned to the fair value of the assets acquired and the liabilities assumed of an acquired business.

Annual test for impairment of goodwill

(q) Annual test for impairment of goodwill

No goodwill impairment losses were recognized for the years ended December 31, 2011, 2012 and 2013.

Operating leases

(r) Operating leases

Revenue recognition

(s) Revenue recognition

The Group generates revenues from internet value-added services ("IVAS") and online advertising. Revenues from IVAS are generated from online music and entertainment, online games, membership subscription fees and other IVAS. Online advertising revenues are primarily generated from sales of different forms of advertising on the Group's platform. Revenue is recognized when persuasive evidence of an arrangement exists, service has been rendered, the price is fixed or determinable and collection is reasonably assured. Revenue is deferred until these criteria are met as described below.

(i)

Internet value-added services

The Group operates a virtual currency system, under which, the users can directly purchase virtual currency, virtual items on YY Client's online community channels or pay membership subscription fees via online payment systems provided by third parties including payments using mobile phone, internet debit/credit card payment and other third party payment systems. The virtual currency can be converted into game tokens that can be used to purchase virtual items in online games (both developed by third parties and self-developed), or used directly to purchase virtual items on YY Client's online community channels or used to pay membership subscription fees. Virtual currency sold but not yet consumed by the purchasers is recorded as "Advances from customers" and upon conversion or being used, is recognized as revenue according to the respective prescribed revenue recognition policies addressed below:
- (1)
  
  Online music and entertainment revenue

The Group creates and offers virtual items to be used by users on online music and entertainment channels, which the Group operates and maintains. The virtual items are offered free of charge or sold to users at different specified prices as pre-determined by the Company. Online music and entertainment revenue consists of sales of virtual items. Users purchase consumable virtual items from the Group and present them to performers to show support for their favorite performers or time-based virtual items, which provide users with recognized status, such as priority speaking rights or special symbols on the music channels for a specific period of time. In order to attract user traffic, the Group shares with certain popular performers and channel owners, who have entered into revenue sharing arrangements with the Group, a portion of the revenues the Group derives from such in-channel virtual item sales on online music and entertainment channels, which the Group accounts for as cost of revenues. Performers and channel owners, who do not have revenue sharing arrangements with the Group, are not entitled to share any revenue derived from the virtual items sold. The Group does not recognize any revenue from offering free virtual items nor share any revenue with performers or channel owners when free virtual items are presented to performers by the users. Accordingly, online music and entertainment revenue is recognized for the sale of virtual items sold in online music and entertainment channels immediately if the virtual item is a consumable or, in the case of time-based virtual items, recognized ratably over the period each virtual item is made available to the user, which does not exceed one year. The Group does not have further obligations to the user after the virtual items are consumed. Virtual items may be sold individually or bundled into one arrangement. When the Group's users purchase multiple virtual items bundled within the same arrangement, the Group evaluates such arrangements under ASC 605-25 Multiple-Element Arrangements. The Group identifies individual elements under the arrangement and determines if such elements meet the criteria to be accounted for as separate units of accounting. The Group allocates the arrangement consideration to the separate units of accounting based on their relative selling price. The following hierarchy has been followed when determining the relative selling price for each element: (1) vendor specific objective evidence ("VSOE"), (2) third party evidence ("TPE"), and (3) best estimate of selling price ("BESP"). Given that the VSOE of the selling price cannot be determined, the Group has adopted a policy to allocate the consideration of the whole arrangement to different virtual item elements based on the TPE of selling price or the BESP for each virtual item element. The Group determines the fair values of virtual items sold in a bundle based on similar products sold separately on the YY platform based on the TPE of the selling price and determines the fair values of virtual items without similar products sold separately on the YY platform based on the BESP. The BESP is generally based on the selling prices of the various elements of a similar nature when they are sold to users on a stand-alone basis. The BESP may also be based on an estimated stand-alone pricing when the element has not previously been sold on a stand-alone basis.

These estimates are generally determined based on pricing strategies, market factors and strategic objectives. The Group recognizes revenue for each virtual item element in accordance with the applicable revenue recognition method.
- (2)
  
  Online games revenue
        The Group generates revenues from offering virtual items in online games developed by third parties or the Group itself to gaming players. Historically, the majority of online games revenues for the three years ended December 31, 2011, 2012 and 2013 were derived from third parties developed games.

        Users play games through the Group's platform free of charge and are charged for purchases of virtual items including consumable and perpetual items, which can be utilized in the online games to enhance their game-playing experience. Consumable items represent virtual items that can be consumed by a specific user within a specified period of time. Perpetual items represent virtual items that are accessible to the users' account over the life of the online games.

        The Group recognizes revenue when recognition criteria defined under US GAAP are satisfied. For purposes of determining when the service has been provided to the paying player, the Group has determined that an implied obligation exists to the paying player to continue providing access to the games such that the users can utilize the virtual items purchased by game tokens. Game players need to log on and access the games through the Group's platform because their game tokens, virtual items, and game history are specific to the Group's game accounts and non-transferable to other platforms. To purchase in-game virtual items, players can either charge their game accounts by purchasing game tokens or virtual currency from the Group's platform, which are convertible into game tokens based on a predetermined exchange rate agreed among the Group and the relevant game developers.

        The proceeds from the purchase of the Group's virtual currency is recorded as "advances from customers", representing prepayments received from users in the form of the Group's virtual currency not yet converted into game specific tokens. Upon the conversion into a game token from the Group's virtual currency or upon the direct purchase of a game token, whichever is applicable, the proceeds will be shared between the Group and the relevant game developer based on a predetermined contractual ratio. Game tokens are non-refundable and non-exchangeable among different games. The Group's portion, net of the game developer's entitled consideration, is recorded as deferred revenue and amortized according to the prescribed revenue recognition policies described below. Users typically do not convert the virtual currency into game tokens or purchase the game tokens unless they plan to purchase in-game virtual items soon.
- –
  
  Third party developed online games

        Pursuant to contracts signed between the Group and the respective game developers, revenues from the sale or conversion of game tokens to be used for the purchase of in-game virtual items from online games developed by third parties are shared between the Group and the game developers based on a pre-agreed ratio for each game. These revenue-sharing contracts typically last one to two years.

        The third party developed games are primarily under non-exclusive licensing contracts, maintained and updated by the game developers. The Group views the game developers to be the Group's customers and considers the Group's responsibilities under the Group's agreements with the game developers to offer certain standard promotions that include providing access to the platform, announcing the new games to users on the platform, and occasional advertising on the YY platform. The determination of whether to record these revenues using gross or net method is based on an assessment of various factors. The primary factors are whether the Group is acting as the principal in offering services to the game players or as agent in the transaction, and the specific requirement of each contract. The Group determined that for third party developed games, the third party game developers are the principal given the game developers design and develop the web-game services offered, have reasonable latitude to establish prices of game tokens, and are responsible for maintaining and upgrading the game contents and virtual items. Accordingly, the Group records online games revenue, net of the pre-agreed portion of sharing of the revenues with the game developers.

        Given that third party developed games are managed and administered by the third party game developers, the Group does not have access to the data on the consumption details such as when the game token is spent on the virtual items or the types of virtual items (consumable or perpetual items) purchased by each individual game player. However, the Group maintains historical data on timing of the conversion of its virtual currency into game specific tokens and the amount of purchases of game tokens. The Group believes that its performance for, and obligation to, the game developers correspond to the game developers' services to the users. The Group has adopted a policy to recognize revenues relating to game tokens for third party developed games over the estimated user relationship with the Group on a game-by-game basis, which are approximately one to six months for the periods presented. Future usage patterns may differ from historical usage patterns and therefore the estimated user relationship with the Group may change in the future.

        When the Group launches a new game, it estimates the user relationship based on other similar types of games in the market until the new game establishes its own history. The Group considers the game's profile, attributes, target audience, and its appeal to players of different demographics groups in estimating the user relationship period.

        The estimated user relationship period is based on data collected from those users who have acquired game tokens. To estimate the user relationship period, the Group maintains a software system that captures the following information for each user: (a) the frequency that users log into each game via the Group's platform, and (b) the amount and the timing of when the users convert or charge his or her game tokens. The Group estimates the user relationship period for a particular game to be the date a player purchases or converts from virtual currency to a game token through the date the Group estimates the user plays the game for the last time. This computation is completed on a user by user basis. Then, the results for all analyzed users are averaged to determine an estimated end user relationship period for each game. Revenues from in-game payments of each month are recognized over the user relationship period estimated for that game.

        The consideration of user relationship with each online game is based on the Group's best estimate that takes into account all known and relevant information at the time of assessment. The Group assesses the estimated user relationships on a quarterly basis. Any adjustments arising from changes in the user relationship as a result of new information will be accounted as a change in accounting estimate in accordance with ASC 250 Accounting Changes and Error Corrections.
- –
  
  Self-developed games

Revenues derived from self-developed games are recorded on a gross basis as the Group acts as a principal to fulfill all obligations. The Group does not maintain information on consumption details of in-game virtual items, and only has limited information related to the frequency of log-ons for its self-developed games. Given that certain historical data is not available, the Group uses the user relationship of third party games with similar popularity, gaming experience and sales to determine the estimated period of user relationship for its self-developed games.
- (3)
  
  Other IVAS revenue

Other IVAS revenue mainly represents membership subscription revenue, revenue from sales of virtual items in various channels in YY platform, such as live game broadcasting channels etc. and other miscellaneous product sales in YY platform.

The Group operates a membership subscription program where subscription members can have enhanced user privileges when using YY Client. The membership fee is collected up-front from subscribers. The receipt of the revenue is initially recorded as deferred revenue and revenue is recognized ratably over the period of the subscription as services are rendered. Unrecognized portion beyond 12 months from balance sheet date is classified as long-term deferred revenue. Revenue from sales of virtual items in various channels is recognized on item basis, which is consistent with the revenue recognition policies in online music and entertainment revenue stream.

(ii)

Advertising revenues

        Advertising revenues are derived principally from advertising arrangements where the advertisers pay to place their advertisements on the Group's platform in different formats over a particular period of time. Such formats generally include but are not limited to banners, text-links, videos, logos, and buttons. Advertisements on the Group's platform are generally charged on the basis of duration, and advertising contracts are signed to establish the fixed price and the advertising services to be provided. Where collectability is reasonably assured, advertising revenues from advertising contracts are recognized ratably over the contract period of display.

        The Group enters into advertising contracts directly with advertisers or third party advertising agencies that represent advertisers. Contract terms generally range from 1 to 3 months. Both third party advertising agencies and direct advertisers are generally billed at the end of the display period and payments are due usually within 6 months.

        Where customers purchase multiple advertising spaces with different display periods in the same contract, the Group allocates the total consideration to the various advertising elements based on the relative selling price method and recognizes revenue for the different elements over their respective display periods. The following hierarchy should be followed when determining the appropriate selling price for each element: (1) vendor specific objective evidence ("VSOE"), (2) third party evidence ("TPE"), and (3) best estimate of selling price ("BESP"). Given that the VSOE or TPE of the selling price cannot be determined, the Group has adopted a policy to allocate the fair values of different advertising elements based on the best estimate selling prices of each advertisement within the contract taking into consideration the standard price list and historical discounts granted. The Group recognizes revenue on the elements delivered and defers the recognition of revenue for the fair value of the undelivered elements until the remaining obligations have been satisfied. Where all of the elements within an arrangement are delivered uniformly over the agreement period, the revenues are recognized on a straight line basis over the contract period.

        Transactions with third party advertising agencies

        For contracts entered into with third party advertising agencies, the third party advertising agencies will in turn sell the advertising services to advertisers. Revenue is recognized ratably over the contract period of display based on the following criteria:

•

There is persuasive evidence that an arrangement exists—the Group will enter into framework and execution agreements with the advertising agencies, specifying price, advertising content, format and timing

•

Price is fixed or determinable—price charged to the advertising agencies are specified in the agreements, including relevant discount and rebate rates

•

Services are rendered—the Group recognizes revenue ratably as the element are delivered over the contract period of display

•

Collectability is reasonably assured—the Group assesses credit history of each advertising agency before entering into any framework and execution agreements. If the collectability from the agencies is assessed as not reasonably assured, the Group recognizes revenue only when the cash is received and all the other revenue criteria are met.

        The Group provides sales incentives in the forms of discounts and rebates to third party advertising agencies based on purchase volume. As the advertising agencies are viewed as the customers in these transactions, revenue is recognized based on the price charged to the agencies, net of sales incentives provided to the agencies. Sales incentives are estimated and recorded at the time of revenue recognition based on the contracted rebate rates and estimated sales volume based on historical experience.

        Transactions with advertisers

        The Group also enters into advertisement contracts directly with advertisers. Similar to transactions with third party advertising agencies, the Group recognizes revenue ratably as the elements are delivered over the contract period of display. The terms and conditions, including price, are fixed according to the contract between the Group and the advertisers. The Group also performs a credit assessment of all advertisers prior to entering into contracts. Revenue is recognized based on the amount charged to the advertisers, net of discounts.

Advances from customers and deferred revenue

(t) Advances from customers and deferred revenue

Cost of revenues

(u) Cost of revenues

The Group is subject to surcharges of business taxes and VAT, which are calculated based on 12% of the business taxes and VAT payable for the years ended December 31, 2011, 2012 and 2013.

The Group reported business taxes and surcharges, and cultural development fees incurred in cost of revenues.

Research and development expenses

(v) Research and development expenses

Sales and marketing expenses

(w) Sales and marketing expenses

General and administrative expenses

(x) General and administrative expenses

Employee social security and welfare benefits

(y) Employee social security and welfare benefits

Share-based compensation

(z) Share-based compensation

Following the listing of the Company, the grant date fair value of share-based awards is based on stock price of the Company in the NASDAQ Global Market.

Other income

(aa) Other income

Other income primarily consists of government grants which represent cash subsidies received from the PRC government by the operating subsidiaries or VIEs of the Company. Government grants are

Income taxes

(bb) Income taxes

Uncertain tax positions

Statutory reserves

(cc) Statutory reserves

The Group's subsidiaries, VIEs and VIE's subsidiary established in the PRC are required to make appropriations to certain non-distributable reserve funds.

Related parties

(dd) Related parties

Dividends

(ee) Dividends

(Loss) income per share

(ff) (Loss) income per share

Comprehensive (loss) income

(gg) Comprehensive (loss) income

Segment reporting

(hh) Segment reporting

Recently issued accounting pronouncements

(ii) Recently issued accounting pronouncements

Organization and principal activities (Tables)

12 Months Ended

Dec. 31, 2013

Organization and principal activities

Schedule of details of the subsidiaries, VIEs and VIE's subsidiary

The details of the subsidiaries, VIEs and VIE's subsidiary as of December 31, 2013 are set out below:

Name	Place of incorporation	Date of incorporation		Principal activities

Subsidiaries
Duowan Entertainment Corporation ("Duowan BVI")	British Virgin Islands	November 6, 2007	100%	Investment holding
NeoTasks Inc. ("NeoTasks")	Cayman Islands	April 26, 2006	100%	Investment holding
NeoTasks Limited	Hong Kong	June 16, 2005	100%	Investment holding
Huanju Shidai Technology (Beijing) Company Limited ("Beijing Huanju Shidai" or "Duowan Entertainment")	PRC	March 19, 2008	100%	Investment holding
Zhuhai Duowan Information Technology Company Limited ("Zhuhai Duowan" or "Guangzhou Duowan")	PRC	April 9, 2007	100%	Online advertising and software development
Guangzhou Huanju Shidai Information Technology Company Limited ("Guangzhou Huanju Shidai")	PRC	December 2, 2010	100%	Software development
Zhuhai Huanju Shidai Information Technology Company Limited ("Zhuhai Huanju Shidai")	PRC	November 14, 2013	100%	Software development
Variable Interest Entities ("VIEs")
Guangzhou Huaduo Network Technology Company Limited ("Guangzhou Huaduo")	PRC	April 11, 2005	100%	Holder of internet content provider licenses and internet value added services
Beijing Tuda Science and Technology Company Limited ("Beijing Tuda")	PRC	June 2, 2005	100%	Holder of internet content provider licenses
VIE's Subsidiary
Guangzhou Juhui Information Technology Company Limited	PRC	October 24, 2013	100%	Software development

Principal accounting policies (Tables)

12 Months Ended

Dec. 31, 2013

Principal accounting policies

Schedule of property and equipment estimated useful lives and residual rate

	Estimated useful lives	Residual rate

Servers, computers and equipment	3 years	0%-5%
Furniture, fixture and office equipment	5 years	0%-5%
Motor vehicles	4 years	5%
Leasehold improvement	Shorter of lease term or 5 years	—

Schedule of amortization of finite-lived intangible assets is computed using the straight-line method over the following estimated useful lives

		Estimated useful lives

Software			3-5 years
Technology			5 years
Domain name			15 years

Certain risks and concentration (Tables)

12 Months Ended

Dec. 31, 2013

Certain risks and concentration

Schedule of consolidated financial information of the Group's VIEs and VIE's subsidiary excluding the inter company items with the Group's subsidiaries included in the accompanying consolidated financial statements

	December 31,

	2012		2013
	RMB		RMB
Assets
Current assets
Cash and cash equivalents		204,606		575,262
Short-term deposits		90,000		594,000
Accounts receivable, net		41,824		48,329
Amount due from a related party		1,073		73
Prepayments and other current assets		14,897		29,753
Deferred tax assets		25,666		51,631


Total current assets		378,066		1,299,048


Non-current assets
Deferred tax assets		92		383
Investments		2,950		33,920
Property and equipment, net		88,709		100,059
Intangible assets, net		3,218		9,717


Total non-current assets		94,969		144,079


Total assets		473,035		1,443,127




Liabilities
Current liabilities
Accounts payable		27,124		55,818
Deferred revenue		158,323		292,380
Advances from customers		7,271		10,656
Income taxes payable		32,885		47,974
Accrued liabilities and other current liabilities		81,223		197,851
Amounts due to related parties		2,604		2,640


Total current liabilities		309,430		607,319


Non-current liabilities
Deferred revenue		4,525		8,457


Total liabilities		313,955		615,776

	For the year ended December 31,

	2011			2012		2013
	RMB			RMB		RMB
Net revenues		232,376			702,929		1,669,852
Net (loss) income		(79,334	)		80,071		486,095

	For the year ended December 31,

	2011			2012			2013
	RMB			RMB			RMB
Net cash provided by operating activities		57,313			322,378			845,198
Net cash used in investing activities		(46,475	)		(152,197	)		(592,390	)


		10,838			170,181			252,808

Summary of the percentage of accounts receivable from collection agencies and customers with over 10% of total accounts receivable

	For the year ended December 31,

	2011	2012	2013
	RMB	RMB	RMB
Collection agencies and customers
B1	31%	34%	25%
B2	*	*	12%
B3	*	16%	11%
B4	12%	*	*
B5	12%	*	*

- - *
    
    Less than 10%

- Definition

Tabular disclosure of the significant judgments and assumptions made in determining whether a variable interest (as defined) held by the entity requires the variable interest entity (VIE) (as defined) to be consolidated and (or) disclose information about its involvement with the VIE, individually or in aggregate (as applicable); the nature of restrictions, if any, on the consolidated VIE's assets and on the settlement of its liabilities reported by an entity in its statement of financial position, including the carrying amounts of such assets and liabilities; the nature of, and changes in, the risks associated with involvement in the VIE; how involvement with the VIE affects the entity's financial position, financial performance, and cash flows; the lack of recourse if creditors (or beneficial interest holders) of the consolidated VIE have no recourse to the general credit of the primary beneficiary (if applicable); the terms of arrangements, giving consideration to both explicit arrangements and implicit variable interests, if any, that could require the entity to provide financial support to the VIE, including events or circumstances that could expose the entity to a loss; the methodology used by the entity for determining whether or not it is the primary beneficiary of the variable interest entity; the significant factors considered and judgments made in determining that the power to direct the activities of a VIE that most significantly impact the VIE's economic performance are shared (as defined); the carrying amounts and classification of assets and liabilities of the VIE included in the statement of financial position; the entity's maximum exposure to loss, if any, as a result of its involvement with the VIE, including how the maximum exposure is determined and significant sources of the entity's exposure to the VIE; a comparison of the carrying amounts of the assets and liabilities and the entity's maximum exposure to loss; information about any liquidity arrangements, guarantees, and (or) other commitments by third parties that may affect the fair value or risk of the entity's variable interest in the VIE; whether or not the entity has provided financial support or other support (explicitly or implicitly) to the VIE that it was not previously contractually required to provide or whether the entity intends to provide that support, including the type and amount of the support and the primary reasons for providing the support; and supplemental information the entity determines necessary to provide.

+ References+ Details

- Definition

Tabular disclosure of the nature of a concentration, a benchmark to which it is compared, and the percentage that the risk is to the benchmark.

+ References+ Details

Business combination (Tables)

12 Months Ended

Dec. 31, 2013

Business combination

Schedule of allocation of the purchase price at the date of acquisition

		RMB

Property and equipment			128
Intangible assets
Technology			10,035
Software			660
Goodwill			899


Total			11,722

Accounts receivable, net (Tables)

12 Months Ended

Dec. 31, 2013

Accounts receivable, net

Schedule of accounts receivable, net

	December 31,

	2012			2013
	RMB			RMB
Accounts receivable, gross		123,332			131,315
Less: allowance for doubtful receivables		(5,716	)		(31,214	)


Accounts receivable, net		117,616			100,101

Summary of allowance for doubtful accounts

	For the year ended December 31,

	2011			2012			2013
	RMB			RMB			RMB
Balance at the beginning of the year		(387	)		—			(5,716	)
Additions charged to general and administrative expenses		—			(6,884	)		(31,987	)
Write-off during the year		387			1,168			6,489


Balance at the end of the year		—			(5,716	)		(31,214	)

Investments (Tables)

12 Months Ended

Dec. 31, 2013

Investments

Schedule of investments

	December 31

	2012		2013
	RMB		RMB
Cost investments (i)(ii)		—		47,110
Equity investments		2,950		14,919


Total		2,950		62,029

(i): In June 2013, the Company made an investment with an equity interest of 20% in a company with consideration of RMB15 million. The investment was not an investment in common stock or in-substance common stock and therefore was precluded from applying the equity method of accounting. It has been accounted for as an investment under cost method.
(ii): In December 2013, the Company entered into agreements to acquire a minority stake of preferred shares of two companies with total consideration of approximately RMB28 million. Given the fact that the Company cannot unilaterally demand redemption of both the two preferred stocks as the Company only owns less than or equal to 10% of the two preferred stocks respectively, these investments have been accounted for as an investment in an equity security under cost method since the two equity securities do not have a readily determinable fair value.

Property and equipment, net (Tables)

12 Months Ended

Dec. 31, 2013

Property and equipment, net

Schedule of property and equipment

	December 31,

	2012			2013
	RMB			RMB
Gross carrying amount
Servers, computers and equipment		103,005			152,404
Leasehold improvement		22,831			23,257
Furniture, fixture and office equipment		9,083			9,672
Motor vehicles		2,999			5,186
Construction in progress		—			4,652


Total		137,918			195,171
Less: accumulated depreciation		(47,619	)		(92,535	)


Property and equipment, net		90,299			102,636

Intangible assets, net (Tables)

12 Months Ended

Dec. 31, 2013

Intangible assets, net

Summary of Group's intangible assets

	December 31

	2012			2013
	RMB			RMB
Gross carrying amount
Software		4,235			5,477
Technology		9,962			17,121
Domain name		11,477			17,286


Total of gross carrying amount		25,674			39,884


Less: accumulated amortization
Software		(1,808	)		(3,209	)
Technology		(1,659	)		(4,054	)
Domain name		(2,176	)		(2,944	)


Total accumulated amortization		(5,643	)		(10,207	)


Less: impairment
Software		(550	)		(550	)


Intangible assets, net		19,481			29,127

Schedule of estimated amortization expenses

The estimated amortization expenses for each of the following five years are as follows:

	Domain name		Technology		Software

	RMB		RMB		RMB
2014		1,171		3,424		1,263
2015		1,149		3,424		335
2016		1,141		3,424		68
2017		1,141		1,806		33
2018		1,141		989		19

Schedule of weighted average amortization periods of intangible assets

	December 31,

	2012	2013
Domain name	15 years	15 years
Technology	5 years	5 years
Software	3 years	3 years

Deferred revenue (Tables)

12 Months Ended

Dec. 31, 2013

Deferred revenue

Schedule of deferred revenue

	December 31,

	2012		2013
	RMB		RMB
Deferred revenue, current:
IVAS revenues		157,940		292,184
Government grants		1,919		1,682


Total current deferred revenue		159,859		293,866




Deferred revenue, non-current:
IVAS revenues		4,329		8,457
Government grants		2,158		968


Total non-current deferred revenue		6,487		9,425

Accrued liabilities and other current liabilities (Tables)

12 Months Ended

Dec. 31, 2013

Accrued liabilities and other current liabilities

Schedule of accrued liabilities and other current liabilities

	December 31,

	2012		2013
Accrued salaries and welfare		54,688		113,302
Accrued revenue sharing fees		19,504		66,512
Accrued bandwidth costs		15,679		21,869
Business and other taxes payable		7,422		14,248
Value added taxes payable		8,718		5,291
Accrued technology service fee		2,162		5,040
Others		12,116		24,498


Total		120,289		250,760

Cost of revenue (Tables)

12 Months Ended

Dec. 31, 2013

Cost of revenue

Schedule of cost of revenue

	For the year ended December 31,

	2011		2012		2013
	RMB		RMB		RMB
Revenue sharing fees and content costs		6,750		109,273		444,065
Bandwidth costs		75,064		145,037		203,238
Salary and welfare		33,388		50,009		88,456
Business tax and surcharges		16,462		30,026		47,755
Depreciation and amortization		11,951		25,762		37,084
Payment handling costs		9,306		22,828		24,955
Shared-based compensation		15,449		8,407		9,860
Other costs		14,329		24,791		26,586


Total		182,699		416,133		881,999

Income tax (Tables)

12 Months Ended

Dec. 31, 2013

Income tax

Schedule of the current and deferred portions of income tax expense included in the consolidated statements of operations

	For the year ended December 31,

	2011			2012			2013
	RMB			RMB			RMB
Current income tax expenses		(12,516	)		(48,357	)		(125,365	)
Deferred income tax benefits		11,173			19,316			35,414


Income tax expense for the year		(1,343	)		(29,041	)		(89,951	)

Schedule of the reconciliation of total tax expense computed by applying the respective statutory income tax rate to pre-tax (loss) income

	For the year ended December 31,

	2011			2012			2013
	RMB			RMB			RMB
PRC Statutory income tax rate		(25.0%	)		(25.0%	)		(25.0%	)
Effect of preferential tax rate		8.4%			10.4%			10.5%
Effect of tax-exempt entities		(5.1%	)		0.2%			2.2%
Permanent differences⁽ⁱ⁾		32.5%			(13.9%	)		(4.0%	)
Change in valuation allowance		(7.8%	)		(2.0%	)		(3.0%	)
Effect of Super Deduction available to the Group		(4.9%	)		5.7%			3.4%
Adjustments of deferred tax for changes in tax rates		3.6%			—			—


Effective income tax rate		1.7%			(24.6%	)		(15.9%	)

(i): Permanent differences mainly arise from expenses not deductible for tax purposes including primarily share-based compensation costs and expenses incurred by subsidiaries and VIEs.

Schedule of the tax effects of temporary differences that give rise to the deferred tax asset balances

	December 31,

	2012			2013
	RMB			RMB
Deferred tax assets, current:
Deferred revenue		16,270			32,905
Allowance for doubtful accounts receivable, accrued expense and others not currently deductible for tax purposes		17,062			39,791
Valuation allowance⁽ⁱ⁾		(1,783	)		(5,775	)


Total current deferred tax assets, net		31,549			66,921


Deferred tax assets, non-current:
Tax loss carried forward		2,433			16,400
Deferred revenue		538			445
Impairment of an equity investment		45			180
Valuation allowance⁽ⁱ⁾		(2,433	)		(16,400	)


Total non-current deferred tax assets, net		583			625

(i): Valuation allowance is provided against deferred tax assets when the Group determines that it is more likely than not that the deferred tax assets will not be utilized in the future. In making such determination, the Group considered factors including future taxable income exclusive of reversing temporary differences and carry forwards. Valuation allowance was provided for net operating loss carry forward because it was more likely than not that such deferred tax assets will not be realized based on the Group's estimate of its future taxable income. If events occur in the future that allow the Group to realize more of its deferred income tax than the presently recorded amounts, an adjustment to the valuation allowances will result in a decrease in tax expense when those events occur.

Schedule of the net operating tax loss carry forwards

	Amount

	RMB
2014		3,184
2015		—
2016		3,405
2017		3,034
2018		53,371


Total		62,994

Convertible redeemable preferred shares (Tables)

12 Months Ended

Dec. 31, 2013

Convertible redeemable preferred shares

Schedule of preferred shares

As of December 31, 2011, the Preferred Shares comprised of the following:

Series	Issuance Date

A	December 1, 2006	54,488,000	0.0184	1,000	374,332
A	June 2, 2008	81,612,930	0.0245	1,975	560,681
B	August 8, 2008	102,073,860	0.0490	4,959	703,901
C-1	November 22, 2009	16,249,870	0.0800	1,300	112,556
C-2	November 22, 2009	104,999,650	0.1000	10,460	729,464

Schedule of changes of each of the convertible redeemable preferred shares

The following table sets forth the changes of each of the convertible redeemable preferred shares for years ended December 31, 2011, 2012 and 2013:

Series A Preferred Shares

	For the year ended December 31,

	2011		2012			2013
	RMB		RMB			RMB
Beginning balance		846,752		935,013			—
Accretion (decretion) to redemption value		88,261		(485,517	)		—
Conversion of convertible redeemable preferred shares into Class B common shares		—		(449,496	)		—


Ending balance		935,013		—			—

Series B Preferred Shares

	For the year ended December 31,

	2011		2012			2013
	RMB		RMB			RMB
Beginning balance		639,799		703,901			—
Accretion (decretion) to redemption value		64,102		(366,785	)		—
Conversion of convertible redeemable preferred shares into Class B common shares		—		(337,116	)		—


Ending balance		703,901		—			—

Series C Preferred Shares

	For the year ended December 31,

	2011		2012			2013
	RMB		RMB			RMB
Beginning balance		770,720		842,020			—
Accretion (decretion) to redeemable value		71,300		(441,573	)		—
Conversion of convertible redeemable preferred shares into Class B common shares		—		(400,447	)		—


Ending balance		842,020		—			—

Schedule of assumptions in the Discounted Cash Flow Method



Risk-free interest rate	2.53	%
Volatility	66.1	%
Dividend yield	—
Discount rate	16	%

- Definition

Tabular disclosure of temporary equity. Temporary equity is a security with redemption features that are outside the control of the issuer, is not classified as an asset or liability in conformity with GAAP, and is not mandatorily redeemable. Includes any type of security that is redeemable at a fixed or determinable price or on a fixed or determinable date or dates, is redeemable at the option of the holder, or has conditions for redemption which are not solely within the control of the issuer. If convertible, the issuer does not control the actions or events necessary to issue the maximum number of shares that could be required to be delivered under the conversion option if the holder exercises the option to convert the stock to another class of equity. If the security is a warrant or a rights issue, the warrant or rights issue is considered to be temporary equity if the issuer cannot demonstrate that it would be able to deliver upon the exercise of the option by the holder in all cases. Includes stock with put option held by ESOP and stock redeemable by holder only in the event of a change in control of the issuer.

+ References+ Details

Share-based compensation (Tables)

12 Months Ended

Dec. 31, 2013

Share-based compensation

Summary of the restricted shares activity

The following table summarizes the restricted shares activity for the years ended December 31, 2011, 2012 and 2013:



Outstanding, January 1, 2011	48,486,036		0.2936
Granted	10,846,800		0.9362
Forfeited	(2,726,024	)	0.3917
Vested	(13,321,711	)	0.1636


Outstanding, December 31, 2011	43,285,101		0.4885
Forfeited	(3,673,580	)	0.4945
Vested	(21,380,720	)	0.4864


Outstanding, December 31, 2012	18,230,801		0.4898
Forfeited	(1,581,789	)	0.8726
Vested	(11,975,287	)	0.3906


Outstanding, December 31, 2013	4,673,725		0.6144


Expected to vest at December 31, 2013	4,449,366		0.6120

Summary of the restricted share units activity

The following table summarizes the restricted share units activity for the years ended December 31, 2011, 2012 and 2013:



Outstanding, January 1, 2011	—
Granted	9,097,000		1.0630
Forfeited	(100,700	)	1.0630


Outstanding, December 31, 2011	8,996,300		1.0630
Granted	18,295,221		1.0324
Forfeited	(595,900	)	1.0876


Outstanding, December 31, 2012	26,695,621		1.0415
Granted	29,965,989		0.9338
Forfeited	(3,522,992	)	1.0699
Vested	(8,836,018	)	1.0429


Outstanding, December 31, 2013	44,302,600		0.9639


Expected to vest at December 31, 2013	41,581,339		0.9654

Schedule of the movements and details of various equity-classified and liability-classified awards granted by the Company to its employees and non-employee

	Equity-classified Awards (RMB)													Liability-classified Awards (RMB)

	Pre-2009 Scheme options			2009 Incentive Scheme— restricted shares		2011 Incentive Scheme— restricted share units		Share-based awards to CEO and Chairman		Awards to NeoTasks Founders		Sub-total		Pre-2009 Scheme options			Awards to NeoTasks Founders			Sub-total			Total
Balance as of January 1, 2011		—			24,525		—		30,808		—		55,333		109,035			94,089			203,124			258,457
Share-based compensation expenses		2,219			57,805		9,644		14,143		3,359		87,170		23,464			24,367			47,831			135,001
Exercised/Repurchased		—			—		—		—		—		—		(11,701	)		—			(11,701	)		(11,701	)
Reclassifications
—From liability-awards to common share*		—			—		—		—		—		—		—			(57,692	)		(57,692	)		(57,692	)
—From liability-awards to equity awards**		116,328			—		—		—		57,602		173,930		(116,328	)		(57,602	)		(173,930	)		—
Foreign currency translation adjustment		—			—		—		—		—		—		(4,470	)		(3,162	)		(7,632	)		(7,632	)


Balance as of December 31, 2011		118,547			82,330		9,644		44,951		60,961		316,433		—			—			—			316,433




Balance as of January 1, 2012		118,547			82,330		9,644		44,951		60,961		316,433		—			—			—			316,433
Share-based compensation expenses		(89	)		36,371		54,445		9,624		—		100,351		—			—			—			100,351


Balance as of December 31, 2012		118,458			118,701		64,089		54,575		60,961		416,784		—			—			—			416,784




Balance as of January 1, 2013		118,458			118,701		64,089		54,575		60,961		416,784		—			—			—			416,784
Share-based compensation expenses		14,004			7,300		95,792		—		—		117,096		—			—			—			117,096


Balance as of December 31, 2013		132,462			126,001		159,881		54,575		60,961		533,880		—			—			—			533,880

*: During the year ended December 31, 2011, the restricted shares to NeoTasks founders were held by NeoTasks Founders for more than six months, therefore, the related awards amounting to RMB57,692 were reclassified back to common share.
**: As detailed in Note 19(a) and (d), the share options and the restricted shares to NeoTasks founders were reclassified from liability-classified awards to equity-classified awards in September 2011, accordingly.

CEO and Chairman

Share-based compensation

Summary of the restricted shares activity

The following table summarizes information regarding the restricted shares granted to the CEO and the Chairman:



Outstanding, January 1, 2011	29,678,483		0.1875


Outstanding, December 31, 2011	29,678,483		0.1875
Vested	(29,678,483	)	0.1875


Outstanding, December 31, 2012 and 2013	—

NeoTasks founders

Share-based compensation

Summary of the restricted shares activity



Outstanding, January 1, 2011	8,957,690
Vested	(8,957,690	)


Outstanding, December 31, 2011, 2012 and 2013	—

(1): In connection with the First Repurchase occurred in November 2009, Duowan BVI repurchased a portion of their vested restricted shares by utilizing a portion of the proceeds obtained from the Series C preferred shares issuance. The negotiation and execution of the First Repurchase had formed an expectation to the holders of Awards to NeoTasks Founders that it was a practice of Duowan BVI to repurchase the vested restricted shares held by them. The Awards to NeoTasks Founders were deemed to be tainted and they were no longer equity-classified awards but liabilities-classified awards effective from November 2009. The awards would be re-measured at the end of each reporting period until either the repurchase obligation was extinguished or the awards holders were exposed to fluctuation of the market value of the shares for a period of at least six months, or the awards are settled, cancelled or expire unexercised.

Pre-2009 Scheme Options

Share-based compensation

Summary of the activities of the Pre-2009 Scheme Options for employees and non-employee

The following table summarizes the activities of the Pre-2009 Scheme Options for employees and non-employee for the years ended December 31, 2011, 2012 and 2013:



Outstanding, January 1, 2011	19,742,590		0.0056	7.39	18,372
Exercised/Repurchased⁽¹⁾	(1,853,055	)	0.0061


Outstanding, December 31, 2011⁽²⁾	17,889,535		0.0055	6.37	19,366
Forfeited	(19,110	)	0.0067	6.25


Outstanding, December 31, 2012	17,870,425		0.0055	5.37	12,642
Exercised	(4,648,420	)	0.0045	4.30


Outstanding, vested and exercisable December 31, 2013	13,222,005		0.0059	4.40	33,162

(1): In connection with the Series D Common Share Financing (Note 17) in January 2011, certain employees and the non-employee were given the opportunity to cash-settle their vested options. The repurchase price of each vested option/share was the difference between the stated exercise price of the Pre-2009 Scheme Option and US$0.9777, which was the per share issuance price of common shares issued to the new investor. A total of 1,853,055 Pre-2009 Scheme Options were exercised/repurchased by Duowan BVI for cash consideration of RMB11,701. The underlying common shares were cancelled immediately after the repurchase (the "Second Repurchase"). Similar offer was made by Duowan BVI to the non-employee holding the Pre-2009 Scheme Options but that non-employee did not take up the offer.
(2): On September 15, 2011, the board of directors of the Company resolved not to undertake any repurchases of vested or unvested share-based compensation awards, except under those conditions specified in the relevant award scheme and grant documents. In addition, any proposed repurchase of vested or unvested share-based compensation awards should be approved by the majority votes of the board of directors. Such intention of the Company was specifically communicated to all employees with or without the awards. All the employees with vested or unvested awards also confirmed such understanding by a written confirmation. Accordingly, the classification of the liability-classified awards changed back to be equity-classified, and the related liability had been reclassified to additional paid-in capital on the modification date.

Schedule of assumptions used in estimation of fair values of Pre-2009 Scheme Options granted to employees and a non-employees

Pre-2009 Scheme Options granted to employees and a non-employee:

		2011

Risk-free interest rate⁽¹⁾		3.34%-4.01%
Expected term⁽²⁾		6-8 years
Volatility rate⁽³⁾		53.06%-55.34%
Dividend yield⁽⁴⁾		—

(1): The risk-free interest rate of periods within the contractual life of the share option is based on the China Government Bond yield as at the valuation dates.
(2): The expected term is the contract life of the option.
(3): Expected volatility is estimated based on the average of historical volatilities of the comparable companies in the same industry as at the valuation dates.
(4): Duowan BVI and the Company have no history or expectation of paying dividend on its common shares. The expected dividend yield was estimated based on the Company's expected dividend policy over the expected term of the option.

Basic and diluted net (loss) income per share (Tables)

12 Months Ended

Dec. 31, 2013

Basic and diluted net (loss) income per share

Schedule of calculation of basic and diluted net (loss) income per share

Basic and diluted net (loss) income per share for the years ended December 31, 2011, 2012 and 2013 are calculated as follows:

	For the year ended December 31,

	2011			2012			2013
	RMB			RMB			RMB
Numerator:
Net (loss) income attributable to the Company		(83,156	)		89,177			477,727
(Accretion) decretion to convertible redeemable preferred shares redemption value		(223,663	)		1,293,875			—
Allocation of net income to participating preferred shareholders		—			(478,754	)		—


Numerator of basic net (loss) income per share		(306,819	)		904,298			477,727
Dilutive effect of preferred shares		—			(815,121	)		—


Numerator for diluted (loss) income per share		(306,819	)		89,177			477,727




Denominator:
Denominator for basic calculation—weighted average number of Class A and Class B common shares outstanding		485,883,845			604,703,810			1,122,475,688
Dilutive effect of preferred shares		—			320,142,965			—
Dilutive effect of share options		—			17,782,885			16,362,048
Dilutive effect of restricted shares		—			30,594,877			14,400,670
Dilutive effect of restricted share units		—			4,802,491			27,882,891
Dilutive effect of share-based awards granted to CEO and Chairman		—			14,441,808			—


Denominator for diluted calculation		485,883,845			992,468,836			1,181,121,297




Basic net (loss) income per Class A and Class B common share		(0.63	)		1.50			0.43
Diluted net (loss) income per Class A and Class B common share		(0.63	)		0.09			0.40
Basic net (loss) income per ADS*		(12.63	)		29.91			8.51
Diluted net (loss) income per ADS*		(12.63	)		1.80			8.09

*: The Company was listed on November 21, 2012 with issuance of a total of 8,970,000 ADS at a public offering price of US$10.50 per ADS. Each ADS represents 20 Class A common shares. The net (loss) income per ADS for the years ended December 31, 2011, 2012 and 2013 were calculated using the same conversion ratio assuming the ADSs had been in existence during these periods.

Summary of information regarding weighted average of common shares equivalents

The following table summarizes information regarding weighted average of common shares equivalents for the year ended December 31, 2011:

		For the year ended December 31, 2011

Preferred shares—weighted average			359,424,310
Share-based awards for NeoTasks acquisition—weighted average			8,319,608
Share-based awards granted to CEO and Chairman—weighted average			29,678,483
Share options—weighted average			18,488,604
Restricted shares—weighted average			54,045,124
Restricted share units—weighted average			2,625,039
Warrants to an independent institutional investor—weighted average			12,609,970

Related party transactions (Tables)

12 Months Ended

Dec. 31, 2013

Related party transactions

Related Party		Relationship with the Group

Zhuhai Daren Computer Technology Company Limited ("Zhuhai Daren")		Equity investment
Guangzhou Shanghang Information Technical Co., Ltd. ("Shanghang")		Significant influence exercised by the Chairman
Kingsoft Corporation ("Kingsoft")		Significant influence exercised by the Chairman
Xiaomi Corporation ("Xiaomi")		Significant influence exercised by the Chairman
Zhuhai Lequ Technology Co., Ltd. ("Zhuhai Lequ")		Equity investment
Agora, Inc.⁽¹⁾		Controlled by the director and the chairman of technology committee of the Group

(1): In December 2013, the Group made a minority interest investment to form a new company, Agora Inc., with the director and the chairman of technology committee of the Group and other strategic investors.

Schedule of significant related party transactions

During the years ended December 31, 2011, 2012 and 2013, significant related party transactions were as follows:

	For the year ended December 31,

	2011		2012		2013
	RMB		RMB		RMB
Online games revenue sharing from Zhuhai Daren		4,451		7,547		24,452
Bandwidth service provided by Shanghang		21,985		11,776		21,272
Purchase of intangible assets from Kingsoft		—		—		6,010
Online games revenue sharing from Zhuhai Lequ		—		—		5,076
Advertising revenue from Xiaomi		—		—		1,154
Repayment of interest-free loan from Zhuhai Lequ		—		500		1,000
Membership subscription fee revenue from Xiaomi		—		227		—
Interest-free loan to Zhuhai Daren		500		—		—
Repayment of interest-free loan from Zhuhai Daren		—		2,000		—
Interest-free loan to Zhuhai Lequ		—		1,200		—
Disposal of a cost investment to the Chairman and Co-founder, who is also a director of the Company		—		1,000		—
Disposal of an equity investment to Xiaomi		—		2,000		—

Schedule of the amounts due from/to related parties

As of December 31, 2012 and 2013, the amounts due from/to related parties were as follows:

	December 31,

	2012		2013
	RMB		RMB
Amount due from a related party
Other receivables from Zhuhai Lequ		1,073		73


Total		1,073		73




Amounts due to related parties
Accounts payable to Zhuhai Daren		2,362		1,479
Other payables to Shanghang		242		822
Accounts payable to Zhuhai Lequ		—		339


Total		2,604		2,640

Commitments and contingencies (Tables)

12 Months Ended

Dec. 31, 2013

Commitments and contingencies

Schedule of future minimum payments under non-cancellable operating leases

As of December 31, 2013, future minimum payments under non-cancellable operating leases consist of the following:

	Office rental

	RMB
2014		16,919
2015		15,809


		32,728

Organization and principal activities (Details) In Thousands, except Share data, unless otherwise specified	0 Months Ended	12 Months Ended		0 Months Ended	12 Months Ended	0 Months Ended	12 Months Ended		0 Months Ended		1 Months Ended
	Sep. 06, 2011	Dec. 31, 2013 entity	Dec. 31, 2012 CNY	Nov. 21, 2012 Common shares	Dec. 31, 2011 Common shares	Nov. 21, 2012 Class A common shares	Dec. 31, 2013 Class A common shares	Dec. 31, 2012 Class A common shares	Nov. 21, 2012 ADSs USD ($)	Nov. 21, 2012 Preferred Shares	Jan. 31, 2011 Duowan BVI Common shares	Dec. 31, 2010 Duowan BVI Zhuhai Duowan Technology
Organization and principal activities
Equity interest owned (as a percent)												100.00%
Number of shares issued in exchange for each share held by all existing shareholders of Duowan BVI pursuant to a share swap agreement	1
Number of VIEs considered as primary beneficiary		2
Number of ADS issued and sold in IPO (in shares)					51,140,432	179,400,000	21,256,900	179,400,000	8,970,000		51,140,432
Number of common shares represented by each ADS						20	20
Net proceeds received from IPO, after deducting commissions and offering expenses			550,555						$ 82,055
Number of shares converted into Class B common shares				548,408,914			422,001,838			359,424,310

Organization and principal activities (Details 2) (CNY) In Thousands, unless otherwise specified		12 Months Ended									0 Months Ended
	Dec. 31, 2013	Dec. 31, 2013 Guangzhou Juhui Information Technology Company Limited	Dec. 31, 2013 Guangzhou Huaduo Guangzhou Juhui Information Technology Company Limited	Dec. 31, 2013 Beijing Tuda	Dec. 31, 2013 Beijing Huanju Shidai or Duowan Entertainment Guangzhou Huaduo Exclusive Technology Support and Technology Services Agreement	Dec. 31, 2013 Beijing Huanju Shidai or Duowan Entertainment Guangzhou Huaduo Exclusive Business Cooperation Agreement	Dec. 31, 2013 Beijing Huanju Shidai or Duowan Entertainment Guangzhou Huaduo Exclusive Option Agreement	Dec. 31, 2013 Beijing Huanju Shidai or Duowan Entertainment Beijing Tuda Exclusive Technology Support and Technology Services Agreement	Dec. 31, 2013 Beijing Huanju Shidai or Duowan Entertainment Beijing Tuda Exclusive Business Cooperation Agreement	Dec. 31, 2013 Beijing Huanju Shidai or Duowan Entertainment Beijing Tuda Exclusive Option Agreement	Dec. 23, 2009 Duowan BVI	Dec. 31, 2013 Duowan BVI	Dec. 31, 2013 NeoTasks	Dec. 31, 2013 NeoTasks Limited	Dec. 31, 2013 Beijing Huanju Shidai or Duowan Entertainment	Dec. 31, 2013 Zhuhai Duowan or Guangzhou Duowan	Dec. 31, 2013 Guangzhou Huanju Shidai	Dec. 31, 2013 Zhuhai Huanju Shidai
Subsidiaries, VIEs and VIE's subsidiary
% of direct or indirect economic ownership												100.00%	100.00%	100.00%	100.00%	100.00%	100.00%	100.00%
% of direct or indirect economic ownership			100.00%	100.00%
% of direct or indirect economic ownership		1.00
Period of prior written notice required to terminate the agreement					30 days	30 days		30 days	30 days
Term of agreement							10 years			10 years
Total assets of the consolidated VIEs and VIE's subsidiary	1,443,127
Total liabilities of the consolidated VIEs and VIE's subsidiary	615,776
Registered capital and PRC statutory reserves of the VIEs and VIE's subsidiary	241,657
Share split ratio											0.00204

Principal accounting policies (Details)	12 Months Ended
Principal accounting policies (Details)	Dec. 31, 2013
Convenience translation
Rate of translations of amounts from RMB into US$	6.0537
Servers, computers and equipment
Property and equipment
Estimated useful lives	3 years
Servers, computers and equipment \| Minimum
Property and equipment
Residual rate (as a percent)	0.00%
Servers, computers and equipment \| Maximum
Property and equipment
Residual rate (as a percent)	5.00%
Furniture, fixture and office equipment
Property and equipment
Estimated useful lives	5 years
Furniture, fixture and office equipment \| Minimum
Property and equipment
Residual rate (as a percent)	0.00%
Furniture, fixture and office equipment \| Maximum
Property and equipment
Residual rate (as a percent)	5.00%
Motor vehicles
Property and equipment
Estimated useful lives	4 years
Residual rate (as a percent)	5.00%
Leasehold improvement \| Maximum
Property and equipment
Estimated useful lives	5 years

Principal accounting policies (Details 2) (CNY) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Annual test for impairment of goodwill
Goodwill impairment losses	0	0	0
Software
Intangible assets, net
Estimated useful lives	3 years	3 years
Software \| Minimum
Intangible assets, net
Estimated useful lives	3 years
Software \| Maximum
Intangible assets, net
Estimated useful lives	5 years
Technology
Intangible assets, net
Estimated useful lives	5 years
Domain name
Intangible assets, net
Estimated useful lives	15 years	15 years

Principal accounting policies (Details 3)	4 Months Ended	12 Months Ended						0 Months Ended	12 Months Ended			0 Months Ended	10 Months Ended	12 Months Ended
Principal accounting policies (Details 3)	Dec. 31, 2012 item	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2013 IVAS revenue	Dec. 31, 2012 IVAS revenue	Dec. 31, 2011 IVAS revenue	Dec. 01, 2012 Online games revenue	Dec. 31, 2013 Third party developed online games Minimum	Dec. 31, 2013 Third party developed online games Maximum	Dec. 31, 2013 Online music and entertainment revenue item	Nov. 01, 2012 Advertising revenues	Oct. 31, 2012 Advertising revenues	Dec. 31, 2011 Advertising revenues	Dec. 31, 2013 Advertising revenues Minimum	Dec. 31, 2013 Advertising revenues Maximum
Revenue recognition
Maximum period over which each virtual item is made available to the user											1 year
Number of arrangements into which virtual items may be sold individually or bundled											1
Period of revenue-sharing contracts									1 year	2 years
Estimated user relationship period									1 month	6 months
Advertising revenues contract term															1 month	3 months
Period over which payments are due																6 months
Cost of revenues
Tax rate on service income from provision of advertising services in the PRC (as a percent)		3.00%
Number of other cities and provinces in PRC to which the Pilot Program was expanded	8
VAT (as a percent)		6.00%						6.00%				6.00%
Business taxes prior to the Pilot Program's being applied (as a percent)					3.00%	3.00%	3.00%						5.00%	5.00%
Surcharges on business taxes and VAT (as a percent)		12.00%	12.00%	12.00%
PRC business taxes (as a percent)		5.00%

Principal accounting policies (Details 4) (CNY) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013 item	Dec. 31, 2012	Dec. 31, 2011
Sales and marketing expenses
Advertising and market promotion expenses	8,054	5,534	4,234
Employee social security and welfare benefits
Employee social security and welfare benefits	68,334	39,660	23,657
Share-based compensation
Minimum period for which the holder of the awards is exposed to the market value fluctuation of the underlying shares	6 months
Statutory reserves
Minimum percentage appropriation to general reserve fund required	10.00%
Reserve level threshold for mandatory appropriation requirement (as a percent)	50.00%
Minimum percentage appropriation to statutory surplus fund required	10.00%
Surplus fund threshold for mandatory appropriation requirement (as a percent)	50.00%
Amount appropriated to statutory reserves	40,657	0	0
Dividends
Dividends declared	0	0	0
Segment reporting
Number of operating segments	1
Number of geographical segments	0

Certain risks and concentration (Details) (CNY) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013 item	Dec. 31, 2013 Minimum	Dec. 31, 2013 Maximum	Dec. 31, 2013 Guangzhou Huaduo Beijing Huanju Shidai	Dec. 31, 2013 Guangzhou Huaduo Beijing Tuda	Dec. 31, 2013 Guangzhou Huaduo Mr. David Xueling Li, CEO	Dec. 31, 2013 Guangzhou Huaduo Mr. Jun Lei, Chairman of the Company	Dec. 31, 2013 Guangzhou Huaduo Mr. Tony Bin Zhao, Director and Chairman of Technology Committee	Dec. 31, 2013 Guangzhou Huaduo Mr. Jin Cao, General Manager of Website Department	Dec. 31, 2013 Beijing Tuda	Dec. 31, 2013 Beijing Tuda Mr. David Xueling Li, CEO	Dec. 31, 2013 Beijing Tuda Mr. Tony Bin Zhao, Director and Chairman of Technology Committee	Dec. 31, 2013 Beijing Tuda Mr. Jin Cao, General Manager of Website Department	Dec. 31, 2013 Beijing Tuda and Guangzhou Huaduo Beijing Huanju Shidai	Dec. 31, 2012 Beijing Tuda and Guangzhou Huaduo WOFEs	Dec. 31, 2011 Beijing Tuda and Guangzhou Huaduo WOFEs
Certain risks and concentration
Maximum foreign ownership in internet information provider or other value-added telecommunication service provider's business allowed under PRC laws and regulations	50.00%
Number of VIEs through which the group operates online business	2
Equity interests ownership (as a percent)					99.00%	0.50%	0.44%	0.04%	0.02%	100.00%	97.70%	1.50%	0.80%
Term of contractual agreements		10 years	30 years
Maximum percentage of the income of VIEs which may be charged as service fees														100.00%
Maximum percentage of the profits payable by VIEs														100.00%
Number of VIEs or their shareholders entitled to terminate the contracts prior to the expiration date	0
Service fees				31,153											0	0

Certain risks and concentration (Details 2) In Thousands, unless otherwise specified	12 Months Ended						12 Months Ended
	Dec. 31, 2013 USD ($)	Dec. 31, 2013 CNY	Dec. 31, 2012 CNY	Dec. 31, 2011 CNY	Dec. 31, 2012 USD ($)	Dec. 31, 2010 CNY	Dec. 31, 2013 Variable interest entity CNY	Dec. 31, 2012 Variable interest entity CNY	Dec. 31, 2011 Variable interest entity CNY
Current assets
Cash and cash equivalents	$ 120,521	729,598	504,702	128,891	$ 83,371	83,683	575,262	204,606
Short-term deposits	236,692	1,432,863	897,698				594,000	90,000
Accounts receivable, net	16,536	100,101	117,616				48,329	41,824
Amount due from a related party	12	73	1,073				73	1,073
Prepayments and other current assets	11,156	67,533	25,149				29,753	14,897
Deferred tax assets	11,055	66,921	31,549				51,631	25,666
Total current assets	395,972	2,397,089	1,577,787				1,299,048	378,066
Non-current assets
Deferred tax assets	103	625	583				383	92
Investments	10,246	62,029	2,950				33,920	2,950
Property and equipment, net	16,954	102,636	90,299				100,059	88,709
Intangible assets, net	4,811	29,127	19,481				9,717	3,218
Total non-current assets	33,178	200,858	118,402				144,079	94,969
Total assets	429,150	2,597,947	1,696,189				1,443,127	473,035
Current liabilities
Accounts payable	9,315	56,391	28,149				55,818	27,124
Deferred revenue	48,543	293,866	159,859				292,380	158,323
Advances from customers	3,229	19,549	7,515				10,656	7,271
Income taxes payable	12,902	78,107	48,001				47,974	32,885
Accrued liabilities and other current liabilities	41,423	250,760	120,289				197,851	81,223
Amounts due to related parties	436	2,640	2,604				2,640	2,604
Total current liabilities	115,848	701,313	366,417				607,319	309,430
Non-current liabilities
Deferred revenue	1,557	9,425	6,487				8,457	4,525
Total liabilities	117,405	710,738	372,904				615,776	313,955
Net revenues	301,217	1,823,468	820,031	319,655			1,669,852	702,929	232,376
Net (loss) income	78,917	477,727	89,177	(83,156)			486,095	80,071	(79,334)
Net cash provided by operating activities	147,211	891,173	356,852	99,817			845,198	322,378	57,313
Net cash used in investing activities	(108,959)	(659,603)	(498,504)	(528,357)			(592,390)	(152,197)	(46,475)
Net increase in cash and cash equivalents	$ 37,313	225,883	381,088	49,342			252,808	170,181	10,838

Certain risks and concentration (Details 3) (Accounts receivable, Credit concentration)	12 Months Ended
	Dec. 31, 2013 item	Dec. 31, 2012 item	Dec. 31, 2011 item
Top 10 accounts receivable
Concentration of risks
Number of top accounts receivable	10	10	10
Concentration percentage	87.00%	92.00%	96.00%
Collection agencies and customers, B1
Concentration of risks
Concentration percentage	25.00%	34.00%	31.00%
Collection agencies and customers, B2
Concentration of risks
Concentration percentage	12.00%
Collection agencies and customers, B3
Concentration of risks
Concentration percentage	11.00%	16.00%
Collection agencies and customers, B4
Concentration of risks
Concentration percentage			12.00%
Collection agencies and customers, B5
Concentration of risks
Concentration percentage			12.00%

Business combination (Details) In Thousands, unless otherwise specified				0 Months Ended
	Dec. 31, 2013 USD ($)	Dec. 31, 2013 CNY	Dec. 31, 2012 CNY	Mar. 12, 2012 Internet service company CNY	Mar. 12, 2012 Internet service company Technology CNY	Mar. 12, 2012 Internet service company Software CNY
Business combination
Cash consideration				11,722
Purchase price allocation
Property and equipment				128
Intangible assets					10,035	660
Goodwill	261	1,577	1,604	899
Total				11,722

Cash and cash equivalents (Details) In Thousands, unless otherwise specified	Dec. 31, 2013 USD ($)	Dec. 31, 2013 CNY	Dec. 31, 2012 USD ($)	Dec. 31, 2012 CNY	Dec. 31, 2011 CNY	Dec. 31, 2010 CNY	Dec. 31, 2013 RMB CNY	Dec. 31, 2012 RMB CNY	Dec. 31, 2013 US$ USD ($)	Dec. 31, 2013 US$ CNY	Dec. 31, 2012 US$ USD ($)	Dec. 31, 2012 US$ CNY
Cash and cash equivalents
Cash and cash equivalents	$ 120,521	729,598	$ 83,371	504,702	128,891	83,683	715,316	460,176	$ 2,342	14,282	$ 7,084	44,526

- Definition

Amount of currency on hand as well as demand deposits with banks or financial institutions. Includes other kinds of accounts that have the general characteristics of demand deposits. Also includes short-term, highly liquid investments that are both readily convertible to known amounts of cash and so near their maturity that they present insignificant risk of changes in value because of changes in interest rates. Excludes cash and cash equivalents within disposal group and discontinued operation.

+ References+ Details

Accounts receivable, net (Details) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013 USD ($)	Dec. 31, 2013 CNY	Dec. 31, 2012 CNY	Dec. 31, 2011 CNY
Accounts receivable, net
Accounts receivable, gross		131,315	123,332
Less: allowance for doubtful receivables		(31,214)	(5,716)
Accounts receivable, net	16,536	100,101	117,616
Summary of allowance for doubtful accounts
Balance at the beginning of the year		(5,716)		(387)
Additions charged to general and administrative expenses	(5,284)	(31,987)	(6,884)
Write-off during the year		6,489	1,168	387
Balance at the end of the year		(31,214)	(5,716)

Investments (Details)					1 Months Ended
Investments (Details)	Dec. 31, 2013 USD ($)	Dec. 31, 2013 CNY	Dec. 31, 2012 CNY	Jun. 30, 2013 Investment in an equity interest of company CNY	Dec. 31, 2013 Investment in preferred shares of two companies CNY item	Dec. 31, 2013 Investment in preferred shares of company one	Dec. 31, 2013 Investment in preferred shares of company two
Investments
Cost investments		47,110,000
Equity investments		14,919,000	2,950,000
Total	10,246,000	62,029,000	2,950,000
Investments
Minimum equity interest in an investee company (as a percent)				20.00%		10.00%	10.00%
Original investment				15,000,000
Number of companies whose preferred stock is acquired by the entity under the agreement					2
Consideration to acquire minority stake					28,000,000

Property and equipment, net (Details) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013 USD ($)	Dec. 31, 2013 CNY	Dec. 31, 2012 CNY	Dec. 31, 2011 CNY	Dec. 31, 2013 Servers, computers and equipment CNY	Dec. 31, 2012 Servers, computers and equipment CNY	Dec. 31, 2013 Leasehold improvement CNY	Dec. 31, 2012 Leasehold improvement CNY	Dec. 31, 2013 Furniture, fixture and office equipment CNY	Dec. 31, 2012 Furniture, fixture and office equipment CNY	Dec. 31, 2013 Motor vehicles CNY	Dec. 31, 2012 Motor vehicles CNY	Dec. 31, 2013 Construction in progress CNY
Property and equipment, net
Gross carrying amount		195,171	137,918		152,404	103,005	23,257	22,831	9,672	9,083	5,186	2,999	4,652
Less: accumulated depreciation		(92,535)	(47,619)
Property and equipment, net	16,954	102,636	90,299
Depreciation expense	$ 7,427	44,963	29,074	12,888

Intangible assets, net (Details) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013 USD ($)	Dec. 31, 2013 CNY	Dec. 31, 2012 CNY	Dec. 31, 2011 CNY	Dec. 31, 2013 Software CNY	Dec. 31, 2012 Software CNY	Dec. 31, 2013 Technology CNY	Dec. 31, 2012 Technology CNY	Dec. 31, 2013 Domain name CNY	Dec. 31, 2012 Domain name CNY
Intangible assets, net
Gross carrying amount		39,884	25,674		5,477	4,235	17,121	9,962	17,286	11,477
Less: accumulated amortization		(10,207)	(5,643)		(3,209)	(1,808)	(4,054)	(1,659)	(2,944)	(2,176)
Less: impairment					(550)	(550)
Intangible assets, net	4,811	29,127	19,481
Amortization of acquired intangible assets	777	4,707	3,369	1,211
Estimated amortization expenses
2014					1,263		3,424		1,171
2015					335		3,424		1,149
2016					68		3,424		1,141
2017					33		1,806		1,141
2018					19		989		1,141
Weighted average amortization periods of intangible assets
Weighted average amortization period					3 years	3 years	5 years	5 years	15 years	15 years

Goodwill (Details) In Thousands, unless otherwise specified	12 Months Ended
Goodwill (Details) In Thousands, unless otherwise specified	Dec. 31, 2013 CNY	Dec. 31, 2012 CNY	Dec. 31, 2011 CNY	Dec. 31, 2013 USD ($)
Goodwill
Goodwill acquired	1,577	1,604		$ 261
Impairment of goodwill	0	0	0

Deferred revenue (Details) In Thousands, unless otherwise specified	Dec. 31, 2013 USD ($)	Dec. 31, 2013 CNY	Dec. 31, 2012 CNY	Dec. 31, 2013 IVAS revenues CNY	Dec. 31, 2012 IVAS revenues CNY	Dec. 31, 2013 Government grants CNY	Dec. 31, 2012 Government grants CNY
Deferred revenue
Deferred revenue, current	$ 48,543	293,866	159,859	292,184	157,940	1,682	1,919
Deferred revenue, non-current	$ 1,557	9,425	6,487	8,457	4,329	968	2,158

Accrued liabilities and other current liabilities (Details) In Thousands, unless otherwise specified	Dec. 31, 2013 USD ($)	Dec. 31, 2013 CNY	Dec. 31, 2012 CNY
Accrued liabilities and other current liabilities
Accrued salaries and welfare		113,302	54,688
Accrued revenue sharing fees		66,512	19,504
Accrued bandwidth costs		21,869	15,679
Business and other taxes payable		14,248	7,422
Value added taxes payable		5,291	8,718
Accrued technology service fee		5,040	2,162
Others		24,498	12,116
Total	$ 41,423	250,760	120,289

- Definition

Carrying value as of the balance sheet date of obligations incurred through that date and payable arising from transactions not otherwise specified in the taxonomy. Used to reflect the current portion of the liabilities (due within one year or within the normal operating cycle if longer).

+ References+ Details

Cost of revenue (Details) (CNY) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Shared-based compensation	117,096	100,351	135,001
Cost of revenues
Revenue sharing fees and content costs	444,065	109,273	6,750
Bandwidth costs	203,238	145,037	75,064
Salary and welfare	88,456	50,009	33,388
Business tax and surcharges	47,755	30,026	16,462
Depreciation and amortization	37,084	25,762	11,951
Payment handling costs	24,955	22,828	9,306
Shared-based compensation	9,860	8,407	15,449
Other costs	26,586	24,791	14,329
Total	881,999	416,133	182,699

Other income (Details) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013 USD ($)	Dec. 31, 2013 CNY	Dec. 31, 2012 CNY	Dec. 31, 2011 CNY
Other income
Government grants		25,356	2,465	1,982
Others		1,722
Total	$ 4,473	27,078	2,465	1,982

Income tax (Details) (CNY) In Thousands, unless otherwise specified	12 Months Ended					12 Months Ended				72 Months Ended		36 Months Ended	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2013 Cayman	Dec. 31, 2013 BVI	Dec. 31, 2013 Hong Kong	Dec. 31, 2012 Hong Kong	Dec. 31, 2011 Hong Kong	Dec. 31, 2013 PRC	Dec. 31, 2013 PRC	Dec. 31, 2012 PRC	Dec. 31, 2013 Guangzhou Huaduo PRC	Dec. 31, 2013 Other PRC subsidiaries, VIE and VIE's subsidiary
Income tax
Withholding income tax				0	0
Income tax rate (as a percent)	25.00%	25.00%	25.00%			16.50%	16.50%	16.50%		25.00%
Preferential tax rate (as a percent)									15.00%			15.00%	25.00%
Tax exemption period following the first profitable year									2 years
Period for reduction in tax percentage									3 years
Reduction in tax rate for three years following the exemption period (as a percent)									50.00%
Percentage of research and development expenses entitled to claim by enterprise									150.00%
PRC withholding tax rate (as a percent)									10.00%
Aggregate undistributed earnings of subsidiaries available for distribution									753,975	753,975	204,960
Accrued deferred tax liability	0	0

Income tax (Details 2) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013 USD ($)	Dec. 31, 2013 CNY	Dec. 31, 2012 CNY	Dec. 31, 2011 CNY
Current and deferred portions of income tax expense
Current income tax expenses		(125,365)	(48,357)	(12,516)
Deferred income tax benefits	5,850	35,414	19,316	11,173
Income tax expense for the year	$ (14,859)	(89,951)	(29,041)	(1,343)

- Definition

Amount of current income tax expense (benefit) pertaining to taxable income (loss) from continuing operations.

+ References+ Details

- Definition

Amount of deferred income tax expense (benefit) pertaining to income (loss) from continuing operations.

+ References+ Details

Income tax (Details 3)	12 Months Ended
Income tax (Details 3)	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Income tax
PRC Statutory income tax rate (as a percent)	(25.00%)	(25.00%)	(25.00%)
Effect of preferential tax rate (as a percent)	10.50%	10.40%	8.40%
Effect of tax-exempt entities (as a percent)	2.20%	0.20%	(5.10%)
Permanent differences (as a percent)	(4.00%)	(13.90%)	32.50%
Change in valuation allowance (as a percent)	(3.00%)	(2.00%)	(7.80%)
Effect of Super Deduction available to the Group (as a percent)	3.40%	5.70%	(4.90%)
Adjustments of deferred tax for changes in tax rates (as a percent)			3.60%
Effective income tax rate (as a percent)	(15.90%)	(24.60%)	1.70%

Income tax (Details 4) In Thousands, unless otherwise specified	Dec. 31, 2013 USD ($)	Dec. 31, 2013 CNY	Dec. 31, 2012 CNY
Deferred tax assets, current:
Deferred revenue		32,905	16,270
Allowance for doubtful accounts receivable, accrued expense and others not currently deductible for tax purposes		39,791	17,062
Valuation allowance		(5,775)	(1,783)
Total current deferred tax assets, net	11,055	66,921	31,549
Deferred tax assets, non-current:
Tax loss carried forward		16,400	2,433
Deferred revenue		445	538
Impairment of an equity investment		180	45
Valuation allowance		(16,400)	(2,433)
Total non-current deferred tax assets, net	$ 103	625	583

Income tax (Details 5) (CNY) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013
Net operating tax loss carry forwards
Operating tax loss carry forwards	62,994
PRC
Net operating tax loss carry forwards
Maximum period for claw back underpaid tax plus penalties and interest by tax authorities	5 years
2014
Net operating tax loss carry forwards
Operating tax loss carry forwards	3,184
2016
Net operating tax loss carry forwards
Operating tax loss carry forwards	3,405
2017
Net operating tax loss carry forwards
Operating tax loss carry forwards	3,034
2018
Net operating tax loss carry forwards
Operating tax loss carry forwards	53,371

Common shares (Details) In Thousands, except Share data, unless otherwise specified	12 Months Ended				0 Months Ended	12 Months Ended							0 Months Ended	12 Months Ended		0 Months Ended	1 Months Ended			1 Months Ended
	Dec. 31, 2013 USD ($)	Dec. 31, 2013 CNY	Dec. 31, 2012 CNY	Dec. 31, 2011 CNY	Nov. 21, 2012 Class A common shares USD ($) vote	Dec. 31, 2013 Class A common shares USD ($)	Dec. 31, 2012 Class A common shares USD ($)	Dec. 31, 2011 Class A common shares	Dec. 31, 2013 Class B common shares USD ($)	Dec. 31, 2012 Class B common shares USD ($)	Nov. 21, 2012 Class B common shares USD ($) vote	Dec. 31, 2011 Class B common shares	Nov. 21, 2012 Common shares	Dec. 31, 2011 Common shares	Dec. 31, 2010 Common shares	Oct. 31, 2012 Common shares Restricted shares	Jul. 31, 2011 Duowan BVI Warrants to purchase common shares	Jan. 31, 2011 Duowan BVI Warrants to purchase common shares USD ($)	Jan. 31, 2011 Duowan BVI Warrants to purchase common shares Maximum	Jan. 31, 2011 Duowan BVI Common shares USD ($)	Jan. 31, 2011 Duowan BVI Common shares CNY
Common shares
Issuance of common shares (in shares)					179,400,000	21,256,900	179,400,000							51,140,432						51,140,432	51,140,432
Aggregate consideration of common shares issued and sold to an independent institutional investor				488,969																$ 50,000
Shares allowed to be purchased under warrants																			25,570,216
Warrant to purchase additional common shares, aggregate purchase price																		25,000
Issue price per share																				$ 0.9777
Issuance price of each common share relating to fair value of warrant (in dollars per share)																		$ 0.0830
Issuance costs of common stock	$ 958	5,802	27,815																		1,208
Warrant to acquire common stock, exercised (in shares)																	25,570,216
Conversion of Stock, Shares Converted						422,001,838							548,408,914			5,068,000
Common stock, par value (in dollars per share)					$ 0.00001	$ 0.00001	$ 0.00001		$ 0.00001	$ 0.00001	$ 0.00001
Vote entitled per share					1						10
Number of Class A common shares convertible from Class B common shares					1
Common shares, shares authorized						10,000,000,000	10,000,000,000	0	1,000,000,000	1,000,000,000		4,640,575,690
Common shares, shares issued						622,658,738	179,400,000	0	485,831,386	907,833,224		543,340,914
Common shares, shares outstanding						622,658,738	179,400,000	0	485,831,386	907,833,224		543,340,914		543,340,914	466,630,266

Convertible redeemable preferred shares (Details) In Thousands, except Share data, unless otherwise specified	12 Months Ended			1 Months Ended			1 Months Ended		1 Months Ended			1 Months Ended
	Dec. 31, 2013 USD ($)	Dec. 31, 2013 CNY	Dec. 31, 2012 CNY	Jun. 30, 2008 Series A Preferred Shares CNY	Dec. 31, 2006 Series A Preferred Shares CNY	Dec. 01, 2006 Series A Preferred Shares USD ($)	Aug. 31, 2008 Series B convertible redeemable preferred shares CNY	Aug. 08, 2008 Series B convertible redeemable preferred shares USD ($)	Nov. 30, 2009 Series C Preferred Shares CNY	Nov. 30, 2009 Series C-1 Preferred Shares CNY	Nov. 22, 2009 Series C-1 Preferred Shares USD ($)	Nov. 30, 2009 Series C-2 Preferred Shares CNY	Nov. 22, 2009 Series C-2 Preferred Shares USD ($)
Convertible redeemable preferred shares
Shares issued				81,612,930	54,488,000		102,073,860			16,249,870		104,999,650
Aggregate cash considerations				13,722	7,720		34,232			8,875		71,684
Issue price per share						$ 0.0184		$ 0.0490			$ 0.0800		$ 0.1000
Issuance costs	$ 958	5,802	27,815	172			278		274

Convertible redeemable preferred shares (Details 2) In Thousands, except Share data, unless otherwise specified	12 Months Ended			12 Months Ended	0 Months Ended	1 Months Ended	12 Months Ended				0 Months Ended	12 Months Ended	0 Months Ended	12 Months Ended	0 Months Ended		12 Months Ended			12 Months Ended			0 Months Ended	12 Months Ended		0 Months Ended	12 Months Ended		0 Months Ended
	Dec. 31, 2013 USD ($)	Jan. 31, 2011 USD ($)	Dec. 31, 2010 USD ($)	Dec. 31, 2011 Preferred Shares USD ($)	Nov. 22, 2009 Series A Preferred Shares CNY	Aug. 31, 2008 Series A Preferred Shares CNY	Dec. 31, 2013 Series A Preferred Shares	Dec. 31, 2011 Series A Preferred Shares CNY	Dec. 31, 2010 Series A Preferred Shares CNY	Dec. 01, 2006 Series A Preferred Shares USD ($)	Dec. 01, 2006 Series A Preferred Shares December 1, 2006 USD ($)	Dec. 31, 2011 Series A Preferred Shares December 1, 2006 CNY	Jun. 02, 2008 Series A Preferred Shares June 2, 2008 USD ($)	Dec. 31, 2011 Series A Preferred Shares June 2, 2008 CNY	Nov. 22, 2009 Series B convertible redeemable preferred shares CNY	Aug. 08, 2008 Series B convertible redeemable preferred shares USD ($)	Dec. 31, 2013 Series B convertible redeemable preferred shares	Dec. 31, 2011 Series B convertible redeemable preferred shares CNY	Dec. 31, 2010 Series B convertible redeemable preferred shares CNY	Dec. 31, 2013 Series C Preferred Shares	Dec. 31, 2011 Series C Preferred Shares CNY	Dec. 31, 2010 Series C Preferred Shares CNY	Nov. 22, 2009 Series C-1 Preferred Shares USD ($)	Dec. 31, 2013 Series C-1 Preferred Shares	Dec. 31, 2011 Series C-1 Preferred Shares CNY	Nov. 22, 2009 Series C-2 Preferred Shares USD ($)	Dec. 31, 2013 Series C-2 Preferred Shares	Dec. 31, 2011 Series C-2 Preferred Shares CNY	Nov. 21, 2012 Class B common shares
Convertible redeemable preferred shares
Issuance Date												Dec. 01, 2006		Jun. 02, 2008				Aug. 08, 2008							Nov. 22, 2009			Nov. 22, 2009
Shares issued												54,488,000		81,612,930				102,073,860							16,249,870			104,999,650
Shares outstanding												54,488,000		81,612,930				102,073,860							16,249,870			104,999,650
Issue Price Per Share										$ 0.0184	$ 0.0184		$ 0.0245			$ 0.0490							$ 0.0800			$ 0.1000
Proceeds from Issuance, Net of Issuance Costs											$ 1,000		$ 1,975			$ 4,959							$ 1,300			$ 10,460
Carrying Amount								935,013	846,752			374,332		560,681				703,901	639,799		842,020	770,720			112,556			729,464
Preferred shares, par value (in dollars per share)				$ 0.00001
Conversion ratio				1
Minimum market capitalization for a Qualified IPO		1,500,000	400,000
Common shares, shares issued upon conversion																													359,424,310
Period following the original issue date after which shares can be redeemed by the entity, at the election of the majority of shareholders																				5 years
Cash or cash equivalents minimum thresholds limit	3,000
Free cash flow in preceding twelve months	1,000
Period of minimum free cash flows for redemption of preferred shares	12 months
Redemption price, percentage of original issue price							150.00%										100.00%							100.00%			100.00%
Internal rate of return (as a percent)							10.00%										10.00%							10.00%			10.00%
Incremental value received by preferred shareholders					19	916									176

Convertible redeemable preferred shares (Details 3) (CNY) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011
Series A Preferred Shares
Changes of convertible redeemable preferred shares
Beginning balance	935,013	846,752
Accretion (decretion) to redeemable value	(485,517)	88,261
Conversion of convertible redeemable preferred shares into Class B common shares	(449,496)
Ending balance		935,013
Series B Preferred Shares
Changes of convertible redeemable preferred shares
Beginning balance	703,901	639,799
Accretion (decretion) to redeemable value	(366,785)	64,102
Conversion of convertible redeemable preferred shares into Class B common shares	(337,116)
Ending balance		703,901
Series C Preferred Shares
Changes of convertible redeemable preferred shares
Beginning balance	842,020	770,720
Accretion (decretion) to redeemable value	(441,573)	71,300
Conversion of convertible redeemable preferred shares into Class B common shares	(400,447)
Ending balance		842,020

Convertible redeemable preferred shares (Details 4)	12 Months Ended
Convertible redeemable preferred shares (Details 4)	Dec. 31, 2013 vote	Dec. 31, 2011
Preferred Shares
Convertible redeemable preferred shares
Risk-free interest rate (as a percent)		2.53%
Volatility (as a percent)		66.10%
Discount rate (as a percent)		16.00%
Preferred Stock Voting Rights Per Share	1
Series A Preferred Shares
Convertible redeemable preferred shares
Percentage of the original issuance price for calculating liquidation preference	150.00%
Series B Preferred Shares
Convertible redeemable preferred shares
Percentage of the original issuance price for calculating liquidation preference	100.00%
Series C Preferred Shares
Convertible redeemable preferred shares
Percentage of the original issuance price for calculating liquidation preference	100.00%

Share-based compensation (Details) In Thousands, except Share data, unless otherwise specified	12 Months Ended						0 Months Ended	12 Months Ended									0 Months Ended			1 Months Ended
	Dec. 31, 2013 CNY	Dec. 31, 2012 CNY	Dec. 31, 2011 CNY	Jan. 31, 2011 Duowan BVI Common shares USD ($)	Dec. 31, 2013 Pre-2009 Scheme Options Employees CNY	Dec. 31, 2013 Pre-2009 Scheme Options Non-employee CNY	Nov. 21, 2011 Share options Non-employee USD ($)	Dec. 31, 2013 Share options Pre-2009 Scheme Options USD ($) item	Dec. 31, 2013 Share options Pre-2009 Scheme Options CNY	Dec. 31, 2012 Share options Pre-2009 Scheme Options USD ($)	Dec. 31, 2012 Share options Pre-2009 Scheme Options CNY	Dec. 31, 2011 Share options Pre-2009 Scheme Options USD ($)	Dec. 31, 2011 Share options Pre-2009 Scheme Options CNY	Dec. 31, 2010 Share options Pre-2009 Scheme Options USD ($)	Dec. 31, 2011 Share options Pre-2009 Scheme Options Minimum	Dec. 31, 2011 Share options Pre-2009 Scheme Options Maximum	Dec. 31, 2008 Share options Pre-2009 Scheme Options Employees	Dec. 31, 2007 Share options Pre-2009 Scheme Options Employees	Dec. 31, 2007 Share options Pre-2009 Scheme Options Non-employee item	Jan. 31, 2011 Share options Pre-2009 Scheme Options Duowan BVI CNY	Jan. 31, 2011 Share options Pre-2009 Scheme Options Duowan BVI Common shares USD ($)
Share-based compensation
Awards granted (in shares)																	8,499,050	12,705,700	3,832,290
Number of non-employees to whom options were granted																			1
Vesting period								4 years	4 years
Awards vesting after the first anniversary of the vesting inception date (as a percent)								25.00%	25.00%
Awards vesting in six equal installments over the following 36 months (as a percent)								75.00%	75.00%
Number of equal installments in which award will vest								6	6
Period over which awards will vest in six equal installments								36 months	36 months
Number of options
Outstanding at the beginning of the period (in shares)								17,870,425	17,870,425	17,889,535	17,889,535	19,742,590	19,742,590
Exercised/Repurchased (in shares)								(4,648,420)	(4,648,420)			(1,853,055)	(1,853,055)
Forfeited (in shares)										(19,110)	(19,110)
Outstanding at the end of the period (in shares)										17,870,425	17,870,425	17,889,535	17,889,535	19,742,590
Outstanding, vested and exercisable at the end of the period (in shares)								13,222,005	13,222,005
Weighted average exercise price
Outstanding at the beginning of the period (in dollars per share)								$ 0.0055		$ 0.0055		$ 0.0056
Exercised/Repurchased (in dollars per share)								$ 0.0045				$ 0.0061
Forfeited (in dollars per share)										$ 0.0067
Outstanding at the end of the period (in dollars per share)										$ 0.0055		$ 0.0055		$ 0.0056
Outstanding, vested and exercisable at the end of the period (in dollars per share)								$ 0.0059
Weighted average remaining contractual life
Outstanding at the end of the period										5 years 4 months 13 days	5 years 4 months 13 days	6 years 4 months 13 days	6 years 4 months 13 days	7 years 4 months 20 days
Forfeited										6 years 3 months	6 years 3 months
Exercised								4 years 3 months 18 days	4 years 3 months 18 days
Outstanding, vested and exercisable at the end of the period								4 years 4 months 24 days	4 years 4 months 24 days
Aggregate intrinsic value
Outstanding at the end of the period										$ 12,642		$ 19,366		$ 18,372
Outstanding, vested and exercisable at the end of the period								33,162
Issue Price Per Share				$ 0.9777																	$ 0.9777
Cash consideration paid to exercise/repurchase options																				11,701
Assumptions used in estimation of fair values of Pre-2009 Scheme Options granted to employees and a non-employees
Risk-free interest rate, Minimum (as a percent)												3.34%	3.34%
Risk-free interest rate, Maximum (as a percent)												4.01%	4.01%
Expected term															6 years	8 years
Volatility rate, Minimum (as a percent)												53.06%	53.06%
Volatility rate, Maximum (as a percent)												55.34%	55.34%
Weighted average exercise price of option granted (in dollars per share)							$ 0
Total intrinsic value of options exercised									64,195		0		11,912
Share-based compensation (benefit)	117,096	100,351	135,001						14,004		(89)		25,683
Unrecognized compensation cost and expense					0	0

Share-based compensation (Details 2) In Thousands, except Share data, unless otherwise specified	12 Months Ended															12 Months Ended		0 Months Ended			48 Months Ended		1 Months Ended
	Dec. 31, 2013 CNY	Dec. 31, 2012 CNY	Dec. 31, 2011 CNY	Dec. 31, 2013 Restricted shares USD ($) item	Dec. 31, 2013 Restricted shares CNY	Dec. 31, 2012 Restricted shares USD ($)	Dec. 31, 2012 Restricted shares CNY	Dec. 31, 2011 Restricted shares USD ($)	Dec. 31, 2011 Restricted shares CNY	Dec. 31, 2013 Restricted shares Maximum	Dec. 31, 2013 Restricted shares CEO and Chairman CNY	Dec. 31, 2012 Restricted shares CEO and Chairman USD ($)	Dec. 31, 2012 Restricted shares CEO and Chairman CNY	Dec. 31, 2011 Restricted shares CEO and Chairman CNY	Dec. 31, 2010 Restricted shares CEO and Chairman USD ($)	Dec. 31, 2013 Restricted shares Founders of NeoTasks	Dec. 31, 2011 Restricted shares Founders of NeoTasks CNY	Feb. 23, 2010 Restricted shares CEO	Feb. 23, 2010 Restricted shares Chairman or Co-founder	Dec. 05, 2008 Duowan BVI Founders of NeoTasks USD ($) item	Dec. 31, 2013 Duowan BVI Restricted shares Non-employee	Dec. 31, 2013 Duowan BVI Restricted shares Employees	Oct. 31, 2009 Duowan BVI Restricted shares Founders of NeoTasks CNY
Share-based compensation
Awards vesting after 24 months of the grant date (as a percent)				50.00%	50.00%
Period after the grant date after which 50% of awards will vest				24 months	24 months
Awards vesting in two equal installments over the following 24 months (as a percent)				50.00%	50.00%
Number of equal installments in which award will vest				2	2
Period over which awards will vest in two equal installments				24 months	24 months
Period from receipt of the notification to deliver a properly signed agreement after which service vested shares held by leaving employee shall automatically lapse and expire										30 days
Number of founders to whom warrants were granted																				2
Warrants granted (in shares)																				26,873,070
Exercise price of warrants (in dollars per share)																				$ 0
Incremental charge recognized upon conversion of warrants into restricted shares																							0
Vesting period																			4 years				3 years
Percentage of awards vesting after the second anniversary																			50.00%
Percentage of awards vesting each year after the second anniversary																			25.00%
Percentage of awards vesting annually																							0.33%
Number of restricted shares
Outstanding at the beginning of the period (in shares)				18,230,801	18,230,801	43,285,101	43,285,101	48,486,036	48,486,036			29,678,483	29,678,483		29,678,483		8,957,690
Granted (in shares)								10,846,800	10,846,800									13,369,813	29,678,483		100,000	61,250,677
Forfeited (in shares)				(1,581,789)	(1,581,789)	(3,673,580)	(3,673,580)	(2,726,024)	(2,726,024)
Vested (in shares)				(11,975,287)	(11,975,287)	(21,380,720)	(21,380,720)	(13,321,711)	(13,321,711)			(29,678,483)	(29,678,483)				(8,957,690)
Outstanding at the end of the period (in shares)				4,673,725	4,673,725	18,230,801	18,230,801	43,285,101	43,285,101						29,678,483
Expected to vest at the end of the period (in shares)				4,449,366	4,449,366
Weighted average grant-date fair value
Outstanding at the beginning of the period (in dollars per share)				$ 0.4898		$ 0.4885		$ 0.2936				$ 0.1875			$ 0.1875
Granted (in dollars per share)								$ 0.9362
Forfeited (in dollars per share)				$ 0.8726		$ 0.4945		$ 0.3917
Vested (in dollars per share)				$ 0.3906		$ 0.4864		$ 0.1636				$ 0.1875
Outstanding at the end of the period (in dollars per share)				$ 0.6144		$ 0.4898		$ 0.4885							$ 0.1875
Expected to vest at the end of the period (in dollars per share)				$ 0.6120
Additional disclosures
Total fair value of awards vested											0		35,924	0
Shared-based compensation	117,096	100,351	135,001		7,300		36,371		57,805				9,624	14,143			27,726
Total unrecognized compensation expense					5,873						0
Weighted average period over which unrecognized compensation expense is expected to be recognized				6 months 14 days	6 months 14 days
Minimum period for which awards holders must be exposed to fluctuation of the market value of the shares to stop re-measured of awards at the end of each reporting period																6 months

Share-based compensation (Details 3) In Thousands, except Share data, unless otherwise specified	12 Months Ended			1 Months Ended		12 Months Ended								0 Months Ended	12 Months Ended		0 Months Ended	12 Months Ended	0 Months Ended	12 Months Ended		15 Months Ended
	Dec. 31, 2013 CNY	Dec. 31, 2012 CNY	Dec. 31, 2011 CNY	Oct. 31, 2012 2011 Share Incentive Plan	Sep. 16, 2011 2011 Share Incentive Plan	Dec. 31, 2013 2011 Share Incentive Plan Restricted share units USD ($)	Dec. 31, 2013 2011 Share Incentive Plan Restricted share units CNY	Dec. 31, 2012 2011 Share Incentive Plan Restricted share units USD ($)	Dec. 31, 2012 2011 Share Incentive Plan Restricted share units CNY	Dec. 31, 2011 2011 Share Incentive Plan Restricted share units USD ($)	Dec. 31, 2011 2011 Share Incentive Plan Restricted share units CNY	Dec. 31, 2013 2011 Share Incentive Plan Restricted share units Employees and Non Employees Minimum	Dec. 31, 2013 2011 Share Incentive Plan Restricted share units Employees and Non Employees Maximum	Sep. 16, 2011 2011 Share Incentive Plan Restricted share units Employees	Dec. 31, 2013 2011 Share Incentive Plan Restricted share units Employees	Dec. 31, 2012 2011 Share Incentive Plan Restricted share units Employees	Sep. 16, 2011 2011 Share Incentive Plan Restricted share units Employees Minimum	Dec. 31, 2012 2011 Share Incentive Plan Restricted share units Employees Minimum	Sep. 16, 2011 2011 Share Incentive Plan Restricted share units Employees Maximum	Dec. 31, 2012 2011 Share Incentive Plan Restricted share units Employees Maximum	Dec. 31, 2013 2011 Share Incentive Plan Restricted share units Non-employee	Dec. 31, 2012 2011 Share Incentive Plan Restricted share units Non-employee
Share-based compensation
Shares approved for grants to qualified persons					43,000,000
Vesting period												3 years	5 years				4 years	2 years	5 years	4 years
Annual increase on the first day of each fiscal year, beginning from 2013 in maximum aggregate number of shares which may be issued pursuant to all awards under the Plan				20,000,000
Number of restricted shares
Outstanding at the beginning of the period (in shares)						26,695,621	26,695,621	8,996,300	8,996,300
Granted (in shares)						29,965,989	29,965,989	18,295,221	18,295,221	9,097,000	9,097,000			9,097,000	29,917,989	18,295,221					48,000	0
Forfeited (in shares)						(3,522,992)	(3,522,992)	(595,900)	(595,900)	(100,700)	(100,700)
Vested (in shares)						(8,836,018)	(8,836,018)
Outstanding at the end of the period (in shares)						44,302,600	44,302,600	26,695,621	26,695,621	8,996,300	8,996,300
Expected to vest at the end of the period (in shares)						41,581,339	41,581,339
Weighted average grant-date fair value
Outstanding at the beginning of the period (in dollars per share)						$ 1.0415		$ 1.0630
Granted (in dollars per share)						$ 0.9338		$ 1.0324		$ 1.0630
Forfeited (in dollars per share)						$ 1.0699		$ 1.0876		$ 1.0630
Vested (in dollars per share)						$ 1.0429
Outstanding at the end of the period (in dollars per share)						$ 0.9639		$ 1.0415		$ 1.0630
Expected to vest at the end of the period (in dollars per share)						$ 0.9654
Additional disclosures
Shared-based compensation	117,096	100,351	135,001				95,792		54,445		9,644
Total unrecognized compensation expense							144,499
Weighted average period over which unrecognized compensation expense is expected to be recognized						1 year 4 months 10 days	1 year 4 months 10 days

Share-based compensation (Details 4) (CNY) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Share-based compensation
Balance as of beginning of the period	416,784	316,433	258,457
Share-based compensation expenses	117,096	100,351	135,001
Exercised/Repurchased	(115)		(11,701)
Reclassifications
- From liability-awards to common share			(57,692)
Foreign currency translation adjustment			(7,632)
Balance as of end of the period	533,880	416,784	316,433
Restricted shares
Share-based compensation
Share-based compensation expenses	7,300	36,371	57,805
Restricted shares \| CEO and Chairman
Share-based compensation
Share-based compensation expenses		9,624	14,143
Restricted shares \| NeoTasks founders
Share-based compensation
Share-based compensation expenses			27,726
Reclassifications
Threshold period to reclassify awards back to common share			6 months
Pre-2009 Scheme \| Options
Share-based compensation
Share-based compensation expenses	14,004	(89)	25,683
2011 Incentive Scheme \| Restricted share units
Share-based compensation
Share-based compensation expenses	95,792	54,445	9,644
Equity-classified Awards
Share-based compensation
Balance as of beginning of the period	416,784	316,433	55,333
Share-based compensation expenses	117,096	100,351	87,170
Reclassifications
- From liability-awards to equity awards			173,930
Balance as of end of the period	533,880	416,784	316,433
Equity-classified Awards \| Restricted shares \| CEO and Chairman
Share-based compensation
Balance as of beginning of the period		44,951	30,808
Share-based compensation expenses		9,624	14,143
Reclassifications
Balance as of end of the period	54,575	54,575	44,951
Equity-classified Awards \| Restricted shares \| NeoTasks founders
Share-based compensation
Share-based compensation expenses			3,359
Reclassifications
- From liability-awards to equity awards			57,602
Balance as of end of the period	60,961	60,961	60,961
Equity-classified Awards \| Pre-2009 Scheme \| Options
Share-based compensation
Balance as of beginning of the period	118,458	118,547
Share-based compensation expenses	14,004	(89)	2,219
Reclassifications
- From liability-awards to equity awards			116,328
Balance as of end of the period	132,462	118,458	118,547
Equity-classified Awards \| 2009 Incentive Scheme \| Restricted shares
Share-based compensation
Balance as of beginning of the period	118,701	82,330	24,525
Share-based compensation expenses	7,300	36,371	57,805
Reclassifications
Balance as of end of the period	126,001	118,701	82,330
Equity-classified Awards \| 2011 Incentive Scheme \| Restricted share units
Share-based compensation
Balance as of beginning of the period	64,089	9,644
Share-based compensation expenses	95,792	54,445	9,644
Reclassifications
Balance as of end of the period	159,881	64,089	9,644
Liability-classified Awards
Share-based compensation
Balance as of beginning of the period			203,124
Share-based compensation expenses			47,831
Exercised/Repurchased			(11,701)
Reclassifications
- From liability-awards to common share			(57,692)
- From liability-awards to equity awards			(173,930)
Foreign currency translation adjustment			(7,632)
Liability-classified Awards \| Restricted shares \| NeoTasks founders
Share-based compensation
Balance as of beginning of the period			94,089
Share-based compensation expenses			24,367
Reclassifications
- From liability-awards to common share			(57,692)
- From liability-awards to equity awards			(57,602)
Foreign currency translation adjustment			(3,162)
Liability-classified Awards \| Pre-2009 Scheme \| Options
Share-based compensation
Balance as of beginning of the period			109,035
Share-based compensation expenses			23,464
Exercised/Repurchased			(11,701)
Reclassifications
- From liability-awards to equity awards			(116,328)
Foreign currency translation adjustment			(4,470)

Basic and diluted net (loss) income per share (Details) In Thousands, except Share data, unless otherwise specified	12 Months Ended				0 Months Ended	12 Months Ended		0 Months Ended	12 Months Ended
	Dec. 31, 2013 USD ($)	Dec. 31, 2013 CNY	Dec. 31, 2012 CNY	Dec. 31, 2011 CNY	Nov. 21, 2012 Class A common shares	Dec. 31, 2013 Class A common shares	Dec. 31, 2012 Class A common shares	Nov. 21, 2012 ADSs USD ($)	Dec. 31, 2013 ADSs USD ($)	Dec. 31, 2013 ADSs CNY	Dec. 31, 2012 ADSs CNY	Dec. 31, 2011 ADSs CNY
Numerator:
Net (loss) income attributable to the Company	$ 78,917	477,727	89,177	(83,156)
(Accretion) decretion to convertible redeemable preferred shares redemption value			1,293,875	(223,663)
Allocation of net income to participating preferred shareholders			(478,754)
Net (loss) income attributable to common shareholders	78,917	477,727	904,298	(306,819)
Dilutive effect of preferred shares			(815,121)
Numerator for diluted (loss) income per share		477,727	89,177	(306,819)
Denominator:
Denominator for basic calculation-weighted average number of Class A and Class B common shares outstanding	1,122,475,688	1,122,475,688	604,703,810	485,883,845					56,123,784	56,123,784	30,235,191	24,294,192
Dilutive effect of preferred shares			320,142,965
Dilutive effect of share options	16,362,048	16,362,048	17,782,885
Dilutive effect of restricted shares	14,400,670	14,400,670	30,594,877
Dilutive effect of restricted share units	27,882,891	27,882,891	4,802,491
Dilutive effect of share-based awards granted to CEO and Chairman (in shares)			14,441,808
Denominator for diluted calculation (in shares)	1,181,121,297	1,181,121,297	992,468,836	485,883,845					59,056,065	59,056,065	49,623,442	24,294,192
-basic (in CNY/dollars per share)	$ 0.07	0.43	1.50	(0.63)					$ 1.41	8.51	29.91	(12.63)
-diluted (in CNY/dollars per share)	$ 0.07	0.40	0.09	(0.63)					$ 1.34	8.09	1.80	(12.63)
Additional Information
Number of ADS issued and sold in IPO (in shares)					179,400,000	21,256,900	179,400,000	8,970,000
Public offering price per ADS (in dollars per share)								$ 10.50
Number of common shares represented by each ADS					20	20

Basic and diluted net (loss) income per share (Details 2) (Weighted average)	12 Months Ended
	Dec. 31, 2011
Preferred shares
Information regarding weighted average of common shares equivalents
Anti-dilutive securities excluded from computation of diluted net loss per common share (in shares)	359,424,310
Share options
Information regarding weighted average of common shares equivalents
Anti-dilutive securities excluded from computation of diluted net loss per common share (in shares)	18,488,604
Restricted shares
Information regarding weighted average of common shares equivalents
Anti-dilutive securities excluded from computation of diluted net loss per common share (in shares)	54,045,124
Restricted shares \| CEO and Chairman
Information regarding weighted average of common shares equivalents
Anti-dilutive securities excluded from computation of diluted net loss per common share (in shares)	29,678,483
Restricted shares \| NeoTasks acquisition
Information regarding weighted average of common shares equivalents
Anti-dilutive securities excluded from computation of diluted net loss per common share (in shares)	8,319,608
Restricted share units
Information regarding weighted average of common shares equivalents
Anti-dilutive securities excluded from computation of diluted net loss per common share (in shares)	2,625,039
Warrants to an independent institutional investor
Information regarding weighted average of common shares equivalents
Anti-dilutive securities excluded from computation of diluted net loss per common share (in shares)	12,609,970

- Definition

Securities (including those issuable pursuant to contingent stock agreements) that could potentially dilute basic earnings per share (EPS) or earnings per unit (EPU) in the future that were not included in the computation of diluted EPS or EPU because to do so would increase EPS or EPU amounts or decrease loss per share or unit amounts for the period presented.

+ References+ Details

Related party transactions (Details) In Thousands, unless otherwise specified	12 Months Ended							12 Months Ended
	Dec. 31, 2013 USD ($)	Dec. 31, 2013 CNY	Dec. 31, 2012 CNY	Dec. 31, 2011 CNY	Dec. 31, 2012 Zhuhai Daren CNY	Dec. 31, 2011 Zhuhai Daren CNY	Dec. 31, 2013 Zhuhai Daren CNY	Dec. 31, 2013 Zhuhai Daren Online games revenue CNY	Dec. 31, 2012 Zhuhai Daren Online games revenue CNY	Dec. 31, 2011 Zhuhai Daren Online games revenue CNY	Dec. 31, 2013 Shanghang CNY	Dec. 31, 2012 Shanghang CNY	Dec. 31, 2011 Shanghang CNY	Dec. 31, 2013 Kingsoft CNY	Dec. 31, 2013 Zhuhai Lequ CNY	Dec. 31, 2012 Zhuhai Lequ CNY	Dec. 31, 2013 Zhuhai Lequ Online games revenue CNY	Dec. 31, 2012 Xiaomi CNY	Dec. 31, 2013 Xiaomi Advertising revenue CNY	Dec. 31, 2012 Xiaomi Membership subscription CNY	Dec. 31, 2012 Chairman and Co-founder CNY
Related party transactions
Revenue from related party								24,452	7,547	4,451							5,076		1,154	227
Bandwidth service provided by related party											21,272	11,776	21,985
Purchase of intangible assets	2,417	14,631	1,920	274										6,010
Repayment of interest-free loan from related party	165	1,000	2,500		2,000										1,000	500
Interest-free loan to related party			1,200	500		500										1,200
Disposal of a cost investment to related party	495	3,000	1,000																		1,000
Disposal of an equity investment to related party			2,000															2,000
Amount due from a related party	12	73	1,073												73	1,073
Amounts due to related parties	$ 436	2,640	2,604		2,362		1,479				822	242			339

Commitments and contingencies (Details) (CNY) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Commitments and contingencies
Total office rental expenses	19,423	16,670	6,361
Future minimum payments under non-cancellable operating leases
2014	16,919
2015	15,809
Total	32,728

Restricted net assets (Details) (CNY) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012
Restricted net assets
Percentage of after-tax income required to be transferred to statutory general reserve fund	10.00%
Reserve level threshold for mandatory appropriation requirement (as a percent)	50.00%
Restricted net assets	303,366	311,399

Short-term deposits	12 Months Ended
Short-term deposits	Dec. 31, 2013
Short-term deposits
Short-term deposits	6. Short-term deposits Short-term deposits represent time deposits placed with banks with original maturities of less than one year. Short-term deposits balance as of December 31, 2012 and 2013 were all denominated in RMB.

CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2012
CONSOLIDATED STATEMENTS OF CASH FLOWS
Underwriters' commission	$ 6,593