Document_and_Entity_Informatio
Document and Entity Information | 12 Months Ended |
Sep. 30, 2013 | |
Document Information [Line Items] | ' |
Document Type | '20-F |
Amendment Flag | 'false |
Document Period End Date | 30-Sep-13 |
Document Fiscal Year Focus | '2013 |
Document Fiscal Period Focus | 'FY |
Trading Symbol | 'DL |
Entity Registrant Name | 'CHINA DISTANCE EDUCATION HOLDINGS LTD |
Entity Central Index Key | '0001438644 |
Current Fiscal Year End Date | '--09-30 |
Entity Well-known Seasoned Issuer | 'No |
Entity Current Reporting Status | 'Yes |
Entity Filer Category | 'Accelerated Filer |
Entity Common Stock, Shares Outstanding | 135,532,141 |
CONSOLIDATED_BALANCE_SHEETS
CONSOLIDATED BALANCE SHEETS (USD $) | Sep. 30, 2013 | Sep. 30, 2012 |
In Thousands, unless otherwise specified | ||
Current assets | ' | ' |
Cash and cash equivalents | $71,919 | $49,723 |
Term deposits | 817 | 7,956 |
Restricted cash | 6 | 6 |
Accounts receivable, net of allowance for doubtful accounts of US$2,092 and US$1,773 as of September 30, 2012 and 2013, respectively | 3,518 | 4,081 |
Inventories | 698 | 658 |
Prepayment and other current assets | 4,087 | 3,573 |
Deferred tax assets, current portion | 1,751 | 1,856 |
Deferred cost | 1,889 | 1,795 |
Total current assets | 84,685 | 69,648 |
Non-current assets | ' | ' |
Property, plant and equipment, net | 10,202 | 9,676 |
Goodwill | 7,711 | 7,511 |
Other intangible assets, net | 1,476 | 1,929 |
Deposit for purchase of non-current assets | 374 | 131 |
Other non-current assets | 1,546 | 1,091 |
Total non-current assets | 21,309 | 20,338 |
Total assets | 105,994 | 89,986 |
Current liabilities | ' | ' |
Accrued expenses and other liabilities (including accrued expenses and other liabilities of the consolidated VIE without recourse to China Distance Education Holdings Limited of US$8,789 and US$13,361 as of September 30, 2012 and 2013, respectively) | 15,072 | 9,636 |
Income tax payable (including income tax payable of the consolidated VIE without recourse to China Distance Education Holdings Limited of US$2,319 and US$3,661 as of September 30, 2012 and 2013, respectively) | 4,282 | 2,627 |
Deferred revenue (including deferred revenue of the consolidated VIE without recourse to China Distance Education Holdings Limited of US$9,408 and US$17,120 as of September 30, 2012 and 2013, respectively) | 17,143 | 9,450 |
Refundable fees (including refundable fees of the consolidated VIE without recourse to China Distance Education Holdings Limited of US$3,524 and US$4,300 as of September 30, 2012 and 2013, respectively) | 4,300 | 3,524 |
Total current liabilities | 40,797 | 25,237 |
Non-current liabilities | ' | ' |
Deferred tax liabilities, non-current portion (including non-current portion of deferred tax liabilities of the consolidated VIE without recourse to China Distance Education Holdings Limited of nil and nil as of September 30, 2012 and 2013, respectively) | 677 | 132 |
Total non-current liabilities | 677 | 132 |
Total liabilities | 41,474 | 25,369 |
Commitments and contingencies (Note 20) | ' | ' |
Equity | ' | ' |
Ordinary shares (par value of US$0.0001 per share at September 30, 2012 and 2013, respectively; Authorized - 480,000,000 shares at September 30, 2012 and 2013; Issued and outstanding - 134,386,849 and 135,532,141 shares at September 30, 2012 and 2013, respectively) | 14 | 13 |
Additional paid-in capital | 46,742 | 61,777 |
Accumulated other comprehensive income | 6,295 | 4,922 |
Retained earnings/(cumulative deficits) | 11,469 | -2,095 |
Total China Distance Education Holdings Limited shareholders' equity | 64,520 | 64,617 |
Total equity | 64,520 | 64,617 |
Total liabilities and equity | $105,994 | $89,986 |
CONSOLIDATED_BALANCE_SHEETS_Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) | Sep. 30, 2013 | Sep. 30, 2012 |
In Thousands, except Share data, unless otherwise specified | ||
Accounts receivable, net of allowance for doubtful accounts | $1,773 | $2,092 |
Accrued expenses and other liabilities | 15,072 | 9,636 |
Income tax payable | 4,282 | 2,627 |
Deferred revenue | 17,143 | 9,450 |
Refundable fees | 4,300 | 3,524 |
Deferred tax liabilities, non-current portion | 677 | 132 |
Ordinary shares, par value | $0.00 | $0.00 |
Ordinary shares, Authorized | 480,000,000 | 480,000,000 |
Ordinary shares, Issued | 135,532,141 | 134,386,849 |
Ordinary shares, outstanding | 135,532,141 | 134,386,849 |
Variable Interest Entity, Primary Beneficiary | ' | ' |
Accrued expenses and other liabilities | 13,361 | 8,789 |
Income tax payable | 3,661 | 2,319 |
Deferred revenue | 17,120 | 9,408 |
Refundable fees | 4,300 | 3,524 |
Deferred tax liabilities, non-current portion | ' | ' |
CONSOLIDATED_STATEMENTS_OF_OPE
CONSOLIDATED STATEMENTS OF OPERATIONS (USD $) | 12 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 |
Sales, net of business tax, value-added tax and related surcharges | ' | ' | ' |
Online education services | $58,573 | $40,281 | $30,788 |
Books and reference materials | 5,129 | 4,438 | 4,743 |
Others | 7,658 | 7,383 | 6,033 |
Total net revenues | 71,360 | 52,102 | 41,564 |
Cost of sales | ' | ' | ' |
Cost of services | -27,073 | -20,494 | -16,840 |
Cost of tangible goods sold | -2,844 | -2,587 | -2,794 |
Total cost of sales | -29,917 | -23,081 | -19,634 |
Gross profit | 41,443 | 29,021 | 21,930 |
Operating expenses | ' | ' | ' |
Selling expenses | -15,673 | -11,337 | -9,771 |
General and administrative expenses | -9,806 | -8,248 | -12,221 |
Impairment of purchased call options | ' | ' | -1,115 |
Total operating expenses | -25,479 | -19,585 | -23,107 |
Other operating income | 59 | 58 | 603 |
Operating income (loss) | 16,023 | 9,494 | -574 |
Interest income | 1,415 | 1,119 | 883 |
Exchange loss | -77 | -40 | -143 |
Income before income taxes | 17,361 | 10,573 | 166 |
Less: Income tax expense | -3,797 | -2,600 | -971 |
Net income (loss) from continuing operations | 13,564 | 7,973 | -805 |
Net income (loss) from discontinued operations | ' | 236 | -3,300 |
Net income (loss) | 13,564 | 8,209 | -4,105 |
Net loss attributable to noncontrolling interest | ' | ' | 303 |
Net income (loss) from continuing operations attributable to China Distance Education Holdings Limited | 13,564 | 7,973 | -502 |
Net income (loss) from discontinued operations attributable to China Distance Education Holdings Limited | ' | 236 | -3,300 |
Net income (loss) attributable to China Distance Education Holdings Limited | $13,564 | $8,209 | ($3,802) |
Net (loss) income attributable to China Distance Education Holdings Limited shareholders | ' | ' | ' |
Basic from continuing operations | $0.10 | $0.06 | $0 |
Basic from discontinued operations | ' | $0 | ($0.03) |
Basic | $0.10 | $0.06 | ($0.03) |
Diluted from continuing operations | $0.10 | $0.06 | $0 |
Diluted from discontinued operations | ' | $0 | ($0.03) |
Diluted | $0.10 | $0.06 | ($0.03) |
Weighted average shares used in calculating net (loss) income per share | ' | ' | ' |
Basic | 135,174,562 | 133,996,737 | 133,571,727 |
Diluted | 136,399,233 | 134,363,108 | 133,571,727 |
CONSOLIDATED_STATEMENTS_OF_COM
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 |
Net income (loss) | $13,564 | $8,209 | ($4,105) |
Other comprehensive income - change in cumulative foreign currency translation adjustments | 1,373 | 701 | 1,855 |
Comprehensive income (loss) | 14,937 | 8,910 | -2,250 |
Comprehensive income (loss) attributable to noncontrolling interest | ' | ' | -270 |
Comprehensive income (loss) attributable to China Distance Education Holdings Limited | $14,937 | $8,910 | ($1,980) |
CONSOLIDATED_STATEMENTS_OF_CHA
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (USD $) | Total | Ordinary shares | Additional Paid-in Capital | Additional Paid-in Capital | Additional Paid-in Capital | Accumulated other comprehensive income | Retained earnings/ (Cumulative deficits) | Total China Distance Education Holding Limited shareholders' equity | Total China Distance Education Holding Limited shareholders' equity | Total China Distance Education Holding Limited shareholders' equity | Noncontrolling interest | Noncontrolling interest | Noncontrolling interest |
Start-up training business | Gaokao re-take business | Start-up training business | Gaokao re-take business | Start-up training business | Gaokao re-take business | ||||||||
Beginning Balance at Sep. 30, 2010 | $77,023,000 | $14,000 | $79,075,000 | ' | ' | $2,399,000 | ($6,502,000) | $74,986,000 | ' | ' | $2,037,000 | ' | ' |
Beginning Balance (in shares) at Sep. 30, 2010 | ' | 136,932,849 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net income (loss) for the year | -4,105,000 | ' | ' | ' | ' | ' | -3,802,000 | -3,802,000 | ' | ' | -303,000 | ' | ' |
Foreign currency translation adjustments | 1,855,000 | ' | ' | ' | ' | 1,822,000 | ' | 1,822,000 | ' | ' | 33,000 | ' | ' |
Repurchase of ordinary shares (in shares) | ' | -9,223,188 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Repurchase of ordinary shares | -8,138,000 | -1,000 | -8,137,000 | ' | ' | ' | ' | -8,138,000 | ' | ' | ' | ' | ' |
Options exercised (in shares) | ' | 91,012 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Options exercised | 75,000 | ' | 75,000 | ' | ' | ' | ' | 75,000 | ' | ' | ' | ' | ' |
Stock-based compensation expense (Note 23) | 6,024,000 | ' | 6,024,000 | ' | ' | ' | ' | 6,024,000 | ' | ' | ' | ' | ' |
Acquisition of noncontrolling interest | ' | ' | ' | 911,000 | 856,000 | ' | ' | ' | 911,000 | 856,000 | ' | -911,000 | -856,000 |
Ending Balance at Sep. 30, 2011 | 72,734,000 | 13,000 | 78,804,000 | ' | ' | 4,221,000 | -10,304,000 | 72,734,000 | ' | ' | ' | ' | ' |
Ending Balance (in shares) at Sep. 30, 2011 | ' | 127,800,673 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net income (loss) for the year | 8,209,000 | ' | ' | ' | ' | ' | 8,209,000 | 8,209,000 | ' | ' | ' | ' | ' |
Foreign currency translation adjustments | 701,000 | ' | ' | ' | ' | 701,000 | ' | 701,000 | ' | ' | ' | ' | ' |
Repurchase of ordinary shares (in shares) | ' | -1,285,464 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Repurchase of ordinary shares | -993,000 | ' | -993,000 | ' | ' | ' | ' | -993,000 | ' | ' | ' | ' | ' |
Options exercised (in shares) | ' | 7,871,640 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Options exercised | 3,981,000 | ' | 3,981,000 | ' | ' | ' | ' | 3,981,000 | ' | ' | ' | ' | ' |
Stock-based compensation expense (Note 23) | 141,000 | ' | 141,000 | ' | ' | ' | ' | 141,000 | ' | ' | ' | ' | ' |
Dividends (Note 24) | -16,268,000 | ' | -16,268,000 | ' | ' | ' | ' | -16,268,000 | ' | ' | ' | ' | ' |
Loan to optionees in connection with exercise of options | -3,888,000 | ' | -3,888,000 | ' | ' | ' | ' | -3,888,000 | ' | ' | ' | ' | ' |
Ending Balance at Sep. 30, 2012 | 64,617,000 | 13,000 | 61,777,000 | ' | ' | 4,922,000 | -2,095,000 | 64,617,000 | ' | ' | ' | ' | ' |
Ending Balance (in shares) at Sep. 30, 2012 | ' | 134,386,849 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net income (loss) for the year | 13,564,000 | ' | ' | ' | ' | ' | 13,564,000 | 13,564,000 | ' | ' | ' | ' | ' |
Foreign currency translation adjustments | 1,373,000 | ' | ' | ' | ' | 1,373,000 | ' | 1,373,000 | ' | ' | ' | ' | ' |
Repurchase of ordinary shares (in shares) | ' | -67,100 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Repurchase of ordinary shares | -93,000 | ' | -93,000 | ' | ' | ' | ' | -93,000 | ' | ' | ' | ' | ' |
Options exercised (in shares) | 964,092 | 987,392 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Options exercised | 603,000 | 1,000 | 602,000 | ' | ' | ' | ' | 603,000 | ' | ' | ' | ' | ' |
Stock-based compensation expense (in shares)(Note 23) | ' | 225,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Stock-based compensation expense (Note 23) | 625,000 | ' | 625,000 | ' | ' | ' | ' | 625,000 | ' | ' | ' | ' | ' |
Dividends (Note 24) | -16,056,000 | ' | -16,056,000 | ' | ' | ' | ' | -16,056,000 | ' | ' | ' | ' | ' |
Loan to optionees in connection with exercise of options | -113,000 | ' | -113,000 | ' | ' | ' | ' | -113,000 | ' | ' | ' | ' | ' |
Ending Balance at Sep. 30, 2013 | $64,520,000 | $14,000 | $46,742,000 | ' | ' | $6,295,000 | $11,469,000 | $64,520,000 | ' | ' | ' | ' | ' |
Ending Balance (in shares) at Sep. 30, 2013 | ' | 135,532,141 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
CONSOLIDATED_STATEMENTS_OF_CAS
CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 |
CASH FLOWS FROM OPERATING ACTIVITIES | ' | ' | ' |
Net income (loss) | $13,564 | $8,209 | ($4,105) |
Adjustments to reconcile net (loss) income to net cash provided by operating activities: | ' | ' | ' |
Stock-based compensation | 625 | 141 | 6,024 |
Gain on disposition of the discontinued operation | ' | -297 | ' |
Depreciation of property, plant and equipment | 1,848 | 1,606 | 1,449 |
Amortization of other intangible assets | 771 | 873 | 926 |
Provision of inventories | 67 | 41 | 1 |
Allowance for doubtful accounts | -371 | 211 | 1,144 |
Impairment loss on purchased call option | ' | ' | 1,316 |
Impairment loss on intangible assets | ' | ' | 332 |
Impairment loss on property, plant and equipment | ' | ' | 973 |
Impairment loss on goodwill | ' | ' | 758 |
Losses on disposition of property, plant and equipment | 151 | 9 | 27 |
Changes in operating assets and liabilities: | ' | ' | ' |
Decrease (Increase) in accounts receivable | 1,036 | 434 | -17 |
(Increase) decrease in inventories | -89 | -328 | 258 |
(Increase) in prepayments and other assets | -420 | -679 | -1,054 |
Decrease (increase) in deferred tax assets | 154 | -35 | -630 |
Decrease (increase) in deferred cost | -45 | 99 | -189 |
(Increase) decrease in other non-current assets | -422 | -348 | 50 |
Increase in accrued expenses and other liabilities | 5,132 | 2,827 | 1,111 |
Increase in income tax payable | 1,567 | 261 | 622 |
Increase (decrease) in deferred revenue | 7,360 | 578 | -235 |
Increase in refundable fees | 674 | 898 | 917 |
Decrease (increase) in deferred tax liabilities | 536 | 563 | -486 |
Net cash generated from operating activities | 32,138 | 15,063 | 9,192 |
CASH FLOWS FROM INVESTING ACTIVITIES | ' | ' | ' |
Maturity (purchase) of term deposits | 7,275 | ' | -7,649 |
Withdrawal of restricted cash | ' | 2,670 | 363 |
Acquisition of property, plant and equipment | -2,128 | -1,662 | -1,999 |
Proceeds from disposition of property, plant and equipment | ' | ' | 80 |
Disposal of the discontinued operation, net of cash disposed | ' | -150 | ' |
Acquisition of other intangible assets | -271 | -387 | -402 |
Payment of deposit for the acquisition of non-current assets | -370 | ' | -236 |
Net cash generated from (used in) investing activities | 4,506 | 471 | -9,843 |
CASH FLOWS FROM FINANCING ACTIVITIES | ' | ' | ' |
Repurchase of ordinary shares | -93 | -993 | -8,138 |
Proceeds from share options exercised by employees | 603 | 3,981 | 75 |
Loan to optionees in connection with exercise of options | -408 | -3,888 | ' |
Repayment of loan to optionees in connection with exercise of options | 295 | ' | ' |
Dividends paid to shareholders | -16,056 | -16,268 | ' |
Net cash used in financing activities | -15,659 | -17,168 | -8,063 |
Exchange rate effect on cash and cash equivalents | 1,211 | 410 | 906 |
Net increase (decrease) in cash and cash equivalents | 22,196 | -1,224 | -7,808 |
Cash and cash equivalents at beginning of the year | 49,723 | 50,947 | 58,755 |
Cash and cash equivalents at end of the year | 71,919 | 49,723 | 50,947 |
Supplemental schedule of cash flows information Income tax paid | -1,539 | -1,818 | -1,439 |
Supplemental schedule of non-cash activities | ' | ' | ' |
Payable for acquisition of property, plant and equipment included in accrued expenses and other liabilities | ' | ' | 633 |
Acquisition of property, plant and equipment and other intangible assets through utilization of deposits | 133 | 111 | ' |
Offset consideration payable in connection with acquisition of Champion Xinlixiang with receivable from original selling shareholder | ' | ' | ($1,711) |
ORGANIZATION_AND_BASIS_OF_PRES
ORGANIZATION AND BASIS OF PRESENTATION | 12 Months Ended | ||||||||||||
Sep. 30, 2013 | |||||||||||||
ORGANIZATION AND BASIS OF PRESENTATION | ' | ||||||||||||
1 | ORGANIZATION AND BASIS OF PRESENTATION | ||||||||||||
China Distance Education Holdings Limited (the “Company”) was incorporated under the law of the Cayman Islands on January 11, 2008. The Company, its subsidiaries, its consolidated variable interest entity (“VIE”) and VIE’s subsidiaries (collectively the “Group”) are primarily engaged in providing online and offline education services, and selling related products in the People’s Republic of China (“PRC”). | |||||||||||||
As of September 30, 2013, details of the Company’s subsidiaries, its VIE and VIE’s subsidiaries were as follows: | |||||||||||||
Company | Date of | Place of | Percentage of | Principal activities | |||||||||
establishment | establishment | legal ownership | |||||||||||
by the Company | |||||||||||||
Subsidiaries: | |||||||||||||
China Distance Education Limited (“CDEL Hong Kong”) | March 13, 2003 | Hong Kong | 100 | % | Investment holding | ||||||||
Practice Enterprises Network China International Links Limited (“Pencil”) | February 23, 2010 | Hong Kong | 100 | % | Inactive | ||||||||
DL Education Service , LLC (“DL Education”) | September 27, 2012 | US | 100 | % | Inactive | ||||||||
Beijing Champion Distance Education Technology Co., Ltd. (“Champion Technology”) | 5-Jan-04 | PRC | 100 | % | Provision of technical support and consultancy services and course production | ||||||||
Beijing Champion Education Technology Co., Ltd. (“Champion Education Technology”) | 23-Apr-07 | PRC | 100 | % | Software licensing and course production | ||||||||
Variable interest entity: | |||||||||||||
Beijing Champion Hi-Tech Co., Ltd. (“Beijing Champion”) | 12-Jul-00 | PRC | Nil | Provision of online education services and sales of books and reference materials | |||||||||
Subsidiaries of variable interest entity: | |||||||||||||
Beijing Caikaowang Company Ltd. (“Caikaowang”) | November 28, 2007 | PRC | Nil | Provision of online education services | |||||||||
Beijing Champion Wangge Education Technology Co., Ltd. (“Champion Wangge”) | 24-Jun-08 | PRC | Nil | Provision of online education services | |||||||||
Beijing Zhengbao Yucai Education Technology Co., Ltd. (“Zhengbao Yucai”) | 19-Feb-09 | PRC | Nil | Provision of start-up training services | |||||||||
Beijing Haidian District Champion Training School (“Champion Training School”) | 19-Feb-09 | PRC | Nil | Provision of online and offline education services | |||||||||
The VIE arrangements | |||||||||||||
There are some uncertainties as to whether applicable PRC laws and regulations prohibit foreign investors from providing telecommunications value-added services in the PRC. As a Cayman Islands corporation, the Company is deemed a foreign legal person under PRC laws. Accordingly, Champion Technology, the Company’s wholly owned subsidiary in the PRC, as a foreign invested company, may be deemed to be ineligible to engage in education business in the PRC. | |||||||||||||
To comply with these foreign ownership restrictions, the Company operates substantially all of its online education services through its VIE, Beijing Champion, and the VIE’s subsidiaries in the PRC. The VIE and its subsidiaries hold leases and other assets necessary to provide online education services and generate all of the Company’s revenues. To provide the Company effective control over the VIE and the ability to receive substantially all of the economic benefits of the VIE and its subsidiaries, a series of contractual arrangements were entered into amongst CDEL Hong Kong, Champion Technology, Beijing Champion and Beijing Champion’s direct equity holders. | |||||||||||||
• | Agreements that transfer economic benefits to Champion Technology | ||||||||||||
Exclusive technical support and consultancy services agreement | |||||||||||||
Pursuant to the exclusive technical support and consultancy services agreement between Beijing Champion and Champion Technology, Champion Technology has the exclusive right to provide to Beijing Champion technical and consulting services. Champion Technology is entitled to charge Beijing Champion a service fee equal to its profit before such service fee and tax. This agreement will remain effective until Beijing Champion ceases its operations. | |||||||||||||
Equity pledge agreement | |||||||||||||
Pursuant to the equity pledge agreement between Beijing Champion and Champion Technology, the nominee shareholders of Beijing Champion have pledged their equity interest in Beijing Champion to Champion Technology to secure the payment obligations of Beijing Champion under the technical support and consultancy services agreement between Beijing Champion and Champion Technology. If Beijing Champion breaches its contractual obligations under that agreement, Champion Technology, as the pledgee, will be entitled to certain rights, including the right to sell the pledged equity interests. The nominee shareholders of Beijing Champion agree that, without prior written consent of Champion Technology, they will not dispose of the pledged equity interests or create or allow any encumbrance on the pledged equity interests that would prejudice Champion Technology’s interest. This agreement will remain effective until the discharge of Beijing Champion’s contractual obligations under the exclusive technical support and consultancy services agreement as described above. | |||||||||||||
Letter of undertaking from Beijing Champion’s shareholders to Champion Technology | |||||||||||||
Pursuant to this letter addressed to Champion Technology, the shareholders of Beijing Champion undertook to, unless restricted by laws, regulations or legal procedures, (i) remit all dividends, interests, other distributions or remnant assets after liquidation, if any, they receive from Beijing Champion to Champion Technology without compensation, after paying the corresponding tax and any other required expenses, (ii) transfer all or part of their equity interests to CDEL Hong Kong at a nominal or minimal purchase price, in the event CDEL Hong Kong exercises its exclusive purchase right to acquire any or all of the equity interests in Beijing Champion, (iii) remit to Champion Technology all considerations they may receive from CDEL Hong Kong’s acquisition of any equity interests in Beijing Champion, without compensation, after paying the corresponding tax and any other required expenses and (iv) act in the best interest of Champion Technology. | |||||||||||||
• | Agreements that provide Company effective control over Beijing Champion | ||||||||||||
Exclusive purchase right contract | |||||||||||||
Pursuant to the exclusive purchase right agreement, CDEL Hong Kong has the unconditional right to purchase the entire equity interest in, or all the assets of Beijing Champion, for a purchase price equal to the net assets of Beijing Champion or the minimum price permitted by PRC laws, if and when PRC laws are amended to permit such a transaction. The term of this agreement is ten years from the date thereof and can be extended for another ten years at the discretion of CDEL Hong Kong. Through the exclusive purchase right contract, each of Beijing Champion’s shareholders irrevocably granted CDEL Hong Kong an exclusive right to acquire, at any time, for its own account or through one or more PRC individuals or entities as nominee shareholders of its choice to replace the existing shareholders of Beijing Champion. This kick-out right reinforces CDEL Hong Kong’s ability to direct the activities that most significantly impact Beijing Champion’s economic performance. | |||||||||||||
Power of attorney | |||||||||||||
Pursuant to the power of attorney, the nominee shareholders of Beijing Champion each executed an irrevocable power of attorney assigning Champion Technology or any person designated by Champion Technology as their attorney-in-fact to vote on their behalf on all matters of Beijing Champion requiring shareholder approval under PRC laws and regulations and the articles of association of Beijing Champion. | |||||||||||||
The Articles of Incorporation of Beijing Champion states that the major rights of the shareholders include the power to review and approve annual budget, operating strategy and investment plan, elect the members of board of directors and approve their compensation plan. Therefore, through the irrevocable power of attorney arrangement, Champion Technology has the ability to exercise effective control over Beijing Champion through equity holder votes and, through such votes, to also control the composition of the board of directors. | |||||||||||||
Deed of undertaking: | |||||||||||||
The Company, Mr. Zhengdong Zhu and his wife, Ms. Baohong Yin executed a deed of undertaking (“Deed”) on September 26, 2013. | |||||||||||||
Upon execution of the Deed, at all times that Mr. Zhengdong Zhu and Ms. Baohong Yin holds an otherwise majority voting interest in the Company, Mr. Zhengdong Zhu and Ms. Baohong Yin are constrained from a. exercising their voting rights attaching to their shares collectively in excess of i) the total aggregate voting power of the then total issued and outstanding shares of the Company held by all members of the Company, other than those shares that are beneficially owned by Mr. Zhengdong Zhu and Ms. Baohong Yin, less (ii) one vote in any vote pertaining to the appointment of any new director to fill in the vacancy of the board of directors; and b. exercising their voting rights attaching to their shares collectively in excess of half of the total aggregate voting power of the then total issued and outstanding shares of the Company held by all members of the Company other than shares that are beneficially owned by Mr. Zhengdong Zhu and Ms. Baohong Yin in any vote pertaining to the removal or replacement of a director, appointment of any person to be a director as an addition to the existing board of directors, or change in the size of the board of directors, and cannot requisition a meeting for this purpose, or cast any vote on any matter related to the Deed. | |||||||||||||
This further prevents Mr. Zhengdong Zhu and Ms. Baohong Yin from controlling the rights of the Company as it relates to the contractual agreements. | |||||||||||||
These contractual arrangements allow the Group to effectively control Beijing Champion and its subsidiaries and to derive substantially all of the economic benefits from them. Accordingly, the Group treats Beijing Champion as a VIE and because the Group is the primary beneficiary of Beijing Champion, the Group has consolidated the financial results of Beijing Champion and its subsidiaries. | |||||||||||||
• | Risks in relation to VIE structure | ||||||||||||
The Company believes that the contractual arrangements with Beijing Champion and its shareholders are in compliance with existing PRC laws and regulations and are valid, binding and enforceable and will not result in any violation of PRC laws or regulations and the PRC regulatory authorities may take a contrary view. If the legal structure and contractual arrangements were found to be in violation of any existing PRC laws and regulations, the regulatory authorities may exercise their discretion and: | |||||||||||||
• | revoke the business and operating licenses of our PRC subsidiaries or consolidated affiliated entities; | ||||||||||||
• | restrict the rights to collect revenues from any of our PRC subsidiaries; | ||||||||||||
• | discontinue or restrict the operations of any related-party transactions among our PRC subsidiaries or consolidated affiliated entities; | ||||||||||||
• | require our PRC subsidiaries or consolidated affiliated entities to restructure the relevant ownership structure or operations; | ||||||||||||
• | take other regulatory or enforcement action is, including levying fines that could be harmful to our business; or | ||||||||||||
• | impose additional conditions or requirements with which we may not be able to comply. | ||||||||||||
The imposition of any of these penalties may result in a material adverse effect on the Company’s ability to conduct its business. In addition, if the imposition of any of these penalties causes the Company to lose the rights to direct the activities of the VIE and their subsidiaries or the right to receive their economic benefits, the Company would no longer be able to consolidate the financial results of the VIE and its subsidiaries. | |||||||||||||
The Company’s ability to control Beijing Champion also depends on the powers of attorney that enable Champion Technology to vote on all matters requiring shareholder approval for Beijing Champion. As noted above, the Company believes these powers of attorney are valid, binding and enforceable under existing PRC laws and regulations but may not be as effective as direct equity ownership. | |||||||||||||
Certain shareholders of Beijing Champion are also beneficial owners or directors of the Company. In addition, certain beneficial owners and directors of the Company are also directors or officers of Beijing Champion. Their interests as beneficial owners of Beijing Champion may differ from the interests of the Company as a whole. The Company cannot be certain that if conflicts of interest arise, these parties will act in the best interests of the Company or that conflicts of interests will resolve in the Company’s favor. Currently, the Company does not have existing arrangements to address potential conflicts of interest these parties may encounter in their capacity as beneficial owners of Beijing Champion, on the one hand, and as beneficial owners of the Company, on the other hand. The Company believes the shareholders of Beijing Champion will not act contrary to any of the contractual arrangements and the exclusive purchase right contract provides the Company with a mechanism to remove them as shareholders of Beijing Champion should they act to the detriment of the Company. If any conflict of interest or dispute between the Company and the shareholders of Beijing Champion arises and the Company is unable to resolve it, the Company would have to rely on legal proceedings in the PRC. Such legal proceedings could result in disruption of its business; moreover, there is substantial uncertainty as to the ultimate outcome of any such legal proceedings. | |||||||||||||
The Group’s online education business has been directly operated by (and as a result all of the Group’s revenues have been generated from) the VIE and its subsidiaries. For the years ended September 30, 2012 and 2013, Beijing Champion and its subsidiaries accounted for an aggregate of 53% and 68%, respectively, of the Group’s consolidated total assets, and 95% and 93%, respectively of the Group’s consolidated total liabilities. The assets not associated with the Beijing Champion and its subsidiaries in these years primarily consisted of cash held by China Distance Education Holdings Limited. | |||||||||||||
The following financial information of the Company’s VIE and VIE’s subsidiaries as of September 30, 2012 and 2013 and for each of the three years in the period ended September 30, 2013 was included in the accompanying consolidated financial statements after elimination of intercompany transactions and balances within VIE and VIE’s subsidiaries: | |||||||||||||
As of September 30, | |||||||||||||
2012 | 2013 | ||||||||||||
US$ | US$ | ||||||||||||
Cash and cash equivalents | 15,798 | 39,706 | |||||||||||
Prepayment and other current assets | 3,311 | 3,839 | |||||||||||
Total current assets | 29,581 | 54,575 | |||||||||||
Total assets | 47,381 | 72,515 | |||||||||||
Deferred revenue | 9,408 | 17,120 | |||||||||||
Total current liabilities | 24,041 | 38,442 | |||||||||||
Total liabilities | 24,041 | 38,442 | |||||||||||
Total equity | 23,340 | 34,073 | |||||||||||
For the years ended September 30, | |||||||||||||
2011 | 2012 | 2013 | |||||||||||
US$ | US$ | US$ | |||||||||||
Revenues | 42,510 | 52,005 | 70,942 | ||||||||||
Net income (1) | 7,365 | 14,944 | 21,062 | ||||||||||
Net cash provided by operating activities | 2,860 | 6,958 | 25,755 | ||||||||||
Net cash (used in)/provided by investing activities | (2,137 | ) | 549 | (2,521 | ) | ||||||||
Effects of exchange rate changes | 481 | 183 | 674 | ||||||||||
-1 | This is net income before service fees charged by Champion Technology and Champion Education Technology. | ||||||||||||
There are no consolidated VIE’s assets that are collateral for the VIE’s obligations and which can only be sued to settle the VIE’s obligations. No creditor (or beneficial interest holders) of the VIE have recourse to the general credit of the Company or any of its consolidated subsidiaries. No terms in any arrangements, considering both explicit arrangements and implicit variable interests, require the Company or its subsidiaries to provide financial support to the VIE. However, if the VIE ever needs financial support, the Company or its subsidiaries may, at its option and subject to statutory limits and restrictions, provide financial support to the VIE through loans to the shareholders of the VIE or entrustment loans to the VIE. |
SIGNIFICANT_ACCOUNTING_POLICIE
SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended | ||||
Sep. 30, 2013 | |||||
SIGNIFICANT ACCOUNTING POLICIES | ' | ||||
2 | SIGNIFICANT ACCOUNTING POLICIES | ||||
Basis of presentation and use of estimates | |||||
The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). | |||||
The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities at the balance sheet dates and the reported amounts of revenues and expenses during the reporting periods. Significant estimates and assumptions reflected in the Group’s financial statements include, but are not limited to, revenue recognition, consolidation of VIE, income tax, allowance for doubtful accounts, impairment of goodwill and long-term assets and share-based compensation expenses. Actual results could materially differ from those estimates. | |||||
The effect of discontinued operations has been reflected in certain accounts and balances in the consolidated financial statements for the year ended September 30, 2010 as described in Note 4. | |||||
Principles of consolidation | |||||
The consolidated financial statements include the financial statements of the Company, its subsidiaries, its VIE and VIE’s subsidiaries. All transactions and balances among the Company, its subsidiaries, its VIE and VIE’s subsidiaries have been eliminated upon consolidation. | |||||
Foreign currency translation and transactions | |||||
The Company, DL Education CDEL Hong Kong and Pencil’s functional currencies are United States dollars (“US$”). The Company’s PRC subsidiaries, VIE and VIE’s subsidiaries determine their functional currencies to be the Chinese Renminbi (“RMB”). The Company uses the US$ as its reporting currency and uses the monthly average exchange rate for the year and the exchange rate at the balance sheet date to translate the operating results and financial position of its PRC subsidiaries and its variable interest entities, respectively. Translation differences are recorded in accumulated other comprehensive income, a component of consolidated statements of changes in equity. | |||||
Transactions denominated in foreign currencies are remeasured into the functional currency at the exchange rates prevailing on the transaction dates. Foreign currency denominated financial assets and liabilities are remeasured at the balance sheet date exchange rate. Exchange gains and losses are included in the consolidated statements of comprehensive income (loss). | |||||
Cash and cash equivalents | |||||
Cash and cash equivalents consist of cash on hand and highly liquid investments which are unrestricted as to withdrawal or use, and which have an original maturity of three months or less when purchased. | |||||
Term deposits | |||||
Term deposits consist of deposits placed with financial institutions with an original maturity of greater than three months and less than one year. | |||||
Inventories | |||||
Inventories, consisting of papers and professional examination reference books, are stated at the lower of cost or market value. Cost is determined using the first in, first out method. | |||||
Fair value | |||||
Fair value is 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 it considers assumptions that market participants would use when pricing the asset or liability. Authoritative literature provides a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. The level in the hierarchy within which the fair value measurement in its entirety falls is based upon the lowest level of input that is significant to the fair value measurement as follows: | |||||
Level 1 | |||||
Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities. | |||||
Level 2 | |||||
Level 2 applies to assets or liabilities for which there are inputs other than quoted prices included within Level 1 that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data. | |||||
Level 3 | |||||
Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities. | |||||
Allowance for doubtful accounts | |||||
An allowance for doubtful accounts is recorded in the period in which a loss is determined to be probable based on an assessment of specific evidence indicating doubtful collection, historical experience, account balance aging and prevailing economic conditions. Accounts receivable balances are written off after all collection efforts have been exhausted. | |||||
Property, plant and equipment, net | |||||
Property, plant and equipment are stated at cost and are depreciated using the straight-line method over the estimated useful lives of the assets, as follows: | |||||
Category | Estimated useful life | Estimated residual value | |||
Buildings | 35 years | 5-10% | |||
Electronic and office equipment | 5 years | 5-10% | |||
Motor vehicles | 5 years | 5-10% | |||
Leasehold improvement and building improvement | Shorter of lease term or 5 years | — | |||
Repair and maintenance costs are charged to expense as incurred, whereas the cost of renewals and betterment that extends the useful lives of property, plant and equipment are capitalized as additions to the related assets. Retirements, sales and disposals of assets are recorded by removing the cost and accumulated depreciation from the asset and accumulated depreciation accounts with any resulting gain or loss reflected in the consolidated statements of operations. | |||||
Goodwill | |||||
Goodwill is not amortized, but tested for impairment annually or more frequently if event and circumstances indicate that it might be impaired. | |||||
The excess of the purchase price over the fair value of net assets acquired is recorded on the consolidated balance sheet as goodwill. In September 2011, the FASB issued an authoritative pronouncement related to testing goodwill for impairment. The guidance permits the Company to first assess qualitative factors to determine whether it is “more likely than not” that the fair value of a reporting unit is less than its carrying amount as a basis for determining whether it is necessary to perform the two-step goodwill impairment test. Absent from any impairment indicators, the Group performs its annual impairment test on the last day of each fiscal year. | |||||
For the years ended September 30, 2012 and 2013, the Group did not choose to perform the assessment of qualitative factors for goodwill impairment and performed its annual impairment test using a two-step approach. The first step compares the fair value of a reporting unit to its carrying amount, including goodwill. If the fair value of the reporting unit is greater than its carrying amount, goodwill is not considered impaired and the second step is not required. If the fair value of the reporting unit is less than its carrying amount, the second step of the impairment test measures the amount of the impairment loss, if any, by comparing the implied fair value of goodwill to its carrying amount. If the carrying amount of goodwill exceeds its implied fair value, an impairment loss is recognized equal to that excess. The implied fair value of goodwill is calculated in the same manner that goodwill is calculated in a business combination, whereby the fair value of the reporting unit is allocated to all of the assets and liabilities of that unit, with the excess purchase price over the amounts assigned to assets and liabilities representing the implied fair value of goodwill. | |||||
Other intangible assets, net | |||||
Other intangible assets are amortized using the straight-line basis over the estimated useful lives as follows: | |||||
Category | Estimated useful life | ||||
Computer software | 3~5 years | ||||
Domain names and trademarks | 10~11 years | ||||
Courseware | 1~5 years | ||||
Website | 5 years | ||||
Business contracts | 3~5 years | ||||
Copyrights | 5 years | ||||
Platform | 3.5 years | ||||
Impairment of long-lived assets | |||||
The Group evaluates its long-lived assets or asset group including intangibles with definite lives for impairment whenever events or changes in circumstances (such as a significant adverse change to market conditions that will impact the future use of the assets) indicate that the carrying amount of a group of long-lived assets may not be fully recoverable. When these events occur, the Group evaluates the impairment by comparing the carrying amount of the assets to future undiscounted net cash flows expected to result from the use of the assets and their eventual disposition. If the sum of the expected undiscounted cash flows is less than the carrying amount of the assets, the Group recognizes an impairment loss based on the excess of the carrying amount of the asset group over its fair value, generally based upon discounted cash flows. | |||||
If the intent is to hold the asset for sale and certain other criteria are met (i.e., the asset can be disposed of currently, appropriate levels of authority have approved sale, and there is an actively pursuing buyer), the impairment test is a comparison of the asset’s carrying value to its fair value less costs to sell. To the extent that the carrying value is greater than the asset’s fair value less costs to sell, an impairment loss is recognized for the difference. Assets held for sale are separately presented on the balance sheet and are no longer depreciated. | |||||
Revenue recognition | |||||
Revenues are recognized when the following four criteria are met: (i) persuasive evidence of an arrangement exists, (ii) the service has been rendered, (iii) the fees are fixed or determinable, and (iv) collectability is reasonably assured. | |||||
Online education services | |||||
The online education service provided by the Group to its customers is an integrated service, including audio-video course content, mock examinations and online chat rooms during the subscription period. Audio-video course content, mock examinations and online chat rooms are not practical to be sold on standalone basis and have never been sold separately. | |||||
The Group earns revenues by providing online education services to customers pursuant to two types of revenue models - non-refundable course model and refundable course model. | |||||
The online courses using the non-refundable course model are mainly comprised of regular classes and premium classes. The revenues for the regular classes are recognized on a straight line basis over the subscription period from the month in which the customers enroll in the courses to the month in which subscribed courses terminate. For premium classes, if participants fail to pass the course examination and certain pre-agreed conditions are met, the participants can retake the same premium course and pay only 50% of the course fees. As such, the 50% discount is proportionately applied as a deduction to revenue recognized for each of the two premium classes that participants are entitled to. | |||||
For online courses using the refundable course model (i.e. elite classes), if the participants complete the courses and fail the professional exams and their scores are within a range provided for in the agreement, they are entitled to either a full refund or the right to retake the course. The participants must notify the Group within a 15 -30 day period after the professional examinations scores are released in order to be eligible for the refund or the right to retake the course. The proceeds from the refundable course model are initially recorded as “refundable fees”. Revenues are recognized upon the expiration of the participants’ right to receive a refund or ratably over the course period if the participants decide to retake the course before the expiration of such right. | |||||
Most of the course participants pay course fees via online payment systems provided by third parties including internet debit or credit card payment systems and other third-party payment systems. Some participants may choose to enroll for online courses through the use of prepaid study cards which are purchased from distributors. The Group sells to its regional distributors prepaid study cards at a discount to the face value of the cards. Revenues are recorded using the after-discount-selling-price of the cards and recognized over the period the online course is available to the customer, which generally is from the enrollment date to the completion of the relevant professional examination date. Sales of prepaid study cards that are not activated for course enrollment are recognized as revenues upon expiration of the cards. Prepaid study cards that have been activated but have not been used to enroll online courses do not have an expiry date and will be deferred until they are used to enroll in online courses. Participants who enroll with the Company directly are eligible to a refund within a 7-day trial period. Revenues from direct enrollment with the Company are recognized over the period from the lapse of the 7-day trial period to the completion of the relevant professional examination date. | |||||
The Group may, at times, offer volume discounts to its regional distributors for purchases over a specified amount of prepaid cards during a specified period of time, generally, one year. The amount of future rebates relating to these volume discounts cannot be reasonably estimated and accordingly a deferred revenue balance is recognized for the maximum potential amount of volume discount. If the number of purchases specified in the volume discount provisions is not reached upon the expiry of the volume discount period, the deferred revenue relating to such volume discount for each study card is recognized as revenue over the remaining period the online course is available to the user who enrolls using the study card or recognized as revenue immediately if the related online course has been completed or the study card has expired. | |||||
The Group also provides student recruiting services and online platform to government agencies which use the Group’s online platform to conduct continuing education services. The Group earns service fees as a percentage of total tuition fees based on the agreements entered into with the government agencies. Service fees received are initially recorded as deferred revenue and are recognized as revenue when course participants complete the stipulated study hours and take the examinations, or on a straight line basis over the subscription period based on the terms of the agreements. | |||||
For the years ended September 30, 2011, 2012 and 2013, the Group recognized revenues before business tax and related surcharges in connection with expired study cards amounted to US$103, US$113 and US$164 respectively. | |||||
The online service is provided by Beijing Champion and its subsidiaries which are subject to approximately 3% business tax and related surcharges. The Group records revenues net of these taxes in the consolidated statements of operations. Such business tax and related surcharges for the years ended September 30, 2011, 2012 and 2013 were US$918, US$1,331 and US$1,986 respectively. | |||||
Books and reference materials | |||||
The Group sells books and reference materials to distributors and end users. Revenues relating to such sales are deferred until cash is collected. Inventory costs of products delivered to distributors for which revenues have been deferred are presented as “deferred costs” on the consolidated balance sheets. | |||||
The Group also sells books and reference materials together with study cards which allow the customers to take a certain number of on-line courses for no additional charge. These sales are considered arrangements with two deliverables, consisting of the delivery of books and reference material and the on-line courses service. Because neither vendor-specific objective evidence nor third-party evidence of fair value of the deliverables exist, the Group allocates revenue to each deliverables based on their relative selling price. | |||||
Other revenues | |||||
Other revenues include sales of offline education services, courseware production services, platform production services, and others. | |||||
Revenues from offline training are recognized when the training courses are provided. For offline training sponsored by government authorities, the tuition fees of the training participants are subsidized by the government. Qualified enrollments and the fees to be earned cannot be determined until the confirmation from government authorities regarding the number of students and fees is received by the Company, which is after the completion of services. Therefore, revenues from such services are recognized upon cash receipt or the receipt of confirmations from government authorities, whichever is earlier, when all the other revenue recognition criteria have been met. | |||||
Revenues from sales of courseware, which are designed and developed pursuant to the requests from customers, are recognized when the courseware or platforms are accepted by the customers. The Company has no significant remaining obligation with respect to the courseware or platforms upon the acceptance of the customers. | |||||
From time to time, the Group enters into arrangement to provide the development and maintenance of online platforms to its customers. After the development of online platforms, the Group provides support and maintenance services. The development of online platform and the support and maintenance services have never been sold separately and they do not have standalone value to the customers. Accordingly, revenues from such arrangement is accounted as a single unit of accounting and recognized ratably over the support and maintenance services period. | |||||
Revenues from other services, including magazine content production, advertising and consulting services, are recognized over the period when such services are provided. | |||||
Value added taxes | |||||
The Group is subject to PRC value added tax (“VAT”) generally at a rate of 13% on proceeds received from customers for sales related to books and reference materials, which reduces revenues, and are entitled to an offset for VAT paid for the books and reference materials as well as a portion of VAT paid related to purchase of fixed assets. | |||||
By virtue of the VAT pilot reform scheme in Beijing, effective as of September 1, 2012, Champion Technology and Champion Education Technology are subject to VAT, instead of business tax, for their technical and consulting service, software licensing and course production services provided. The applicable VAT rates are 6% and 3% for Champion Technology and Champion Education Technology, respectively. Champion Technology is a VAT general taxpayer and the output VAT liability of Champion Technology is allowed to offset qualified input VAT paid to suppliers. On the other hand, Champion Education Technology is a VAT small-scale taxpayer and its output VAT liability is not allowed to offset its input VAT. | |||||
Net VAT balance between input VAT and output VAT is recorded in either other current liabilities or other current assets on the consolidated balance sheets. | |||||
Cost of sales | |||||
Cost of online education services primarily includes the production costs of study cards, server and bandwidth leasing fees, lecturer fees, staff costs involved in the operation of online education services including network operation and maintenance, course production and tutor services and other direct costs of providing these services. These costs are expensed when incurred. | |||||
The cost of books and reference materials, including direct materials used for production of books, authorship fee and printing cost, are initially deferred and recorded as “deferred cost”. The deferred costs are recognized as cost of sales when the related revenue is recognized upon cash receipt. | |||||
Advertising expenditure | |||||
Advertising expenditure is expensed when incurred and are included in “selling expenses” in the consolidated statements of operations. Advertising expenses from continuing operations were US$2,204, US$2,112 and US$3,167, and those from discontinued operations were US$179, US$26 and US$nil, for the years ended September 30, 2011, 2012 and 2013, respectively. | |||||
Shipping and handling costs | |||||
Shipping and handling costs of books and reference materials are classified as a component of “selling expenses” in the consolidated statements of operations. Shipping and handling costs classified as selling expenses from continuing operations were US$330, US$252 and US$489, and those from discontinued operations were US$8, US$1 and US$nil, for the years ended September 30, 2011, 2012 and 2013, respectively. | |||||
Income taxes | |||||
Current income taxes are provided for in accordance with the laws of the relevant tax authorities. Deferred income taxes are recognized when temporary differences exist between the tax bases of assets and liabilities and their reported amounts in the financial statements. Net operating loss carry forwards and credits are applied using enacted statutory tax rates applicable to future years. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more-likely-than-not that a portion of or all of the deferred tax assets will not be realized. The components of the deferred tax assets and liabilities are individually classified as current and non-current based on their characteristics. The impact of an uncertain income tax position is recognized at the largest amount that is more-likely-than-not to be sustained upon audit by the relevant tax authority. An uncertain income tax position will not be recognized if it has less than a 50% likelihood of being sustained. Interest and penalties on income taxes will be classified as a component of the provisions for income taxes. | |||||
Share-based compensation | |||||
Share-based compensation with employees is measured based on the grant-date fair value of the equity instrument issued and recognized as compensation expense over the requisite service period, with a corresponding addition to paid-in capital. The Group recognizes compensation expense over the vesting term on a straight-line basis with the amount of compensation expense recognized at any date not less than the portion of the grant-date value of the option vested at that date. | |||||
Share-based compensation with non-employee is measured based on the fair value of options at the earlier of the performance commitment date or the date at which the non-employee’s performance is complete (hereafter referred to as the measurement date). The Group recognizes compensation expense using the graded vesting attribution method. | |||||
Share-based compensation awards which require the issuance of a variable number of shares to settle a fixed monetary amount are accounted for as liabilities. | |||||
Net income per share | |||||
Basic net income per share is computed by dividing income attributable to holders of ordinary shares by the weighted average number of ordinary shares outstanding during the period. Nonvested restricted shares are also participating securities as they enjoy identical dividend rights as ordinary shares. Accordingly, the Group uses the two-class method whereby undistributed net income is allocated on a pro rata basis to each participating share to the extent that each class may share in income for the period. Diluted net income per share reflects the potential dilution that could occur if securities or other contracts to issue ordinary shares were exercised or converted into ordinary shares. The dilutive effect of outstanding share-based awards is reflected in the diluted net income per share by application of the treasury stock method. | |||||
Business combinations | |||||
Business combinations are recorded using the acquisition method of accounting. On October 1, 2009, the Group adopted a new accounting pronouncement with prospective application which made certain changes to the previous authoritative literature on business combinations. From October 1, 2009, the assets acquired, the liabilities assumed, and any noncontrolling interest of the acquiree at the acquisition date, if any, are measured at their fair values as of that date. Goodwill is recognized and measured as the excess of the total consideration transferred plus the fair value of any noncontrolling interest of the acquiree, if any, at the acquisition date over the fair values of the identifiable net assets acquired. Previously, any non-controlling interest was reflected at historical cost. Common forms of the consideration made in acquisitions include cash and common equity instruments. Consideration transferred in a business acquisition is measured at the fair value as at the date of acquisition. | |||||
Where the consideration in an acquisition includes contingent consideration the payment of which depends on the achievement of certain specified conditions post-acquisition, from October 1, 2009 the contingent consideration is recognized and measured at its fair value at the acquisition date and if recorded as a liability it is subsequently carried at fair value with changes in fair value reflected in earnings. For periods prior to October 1, 2009 contingent consideration was not recorded until the contingency was resolved. | |||||
In addition, upon the adoption of the accounting pronouncement regarding noncontrolling interests (see note 17), from October 1, 2009, changes in a parent’s ownership interest while the parent retains its controlling financial interest in its subsidiary are accounted for as equity transaction. Therefore, no gain or loss would be recognized and any difference between the fair value of the consideration received or paid and the amount by which the noncontrolling interest is adjusted is recognized in equity to the parent. | |||||
Comprehensive income (loss) | |||||
Comprehensive income (loss) includes net income and foreign currency translation adjustments and is reported in the consolidated statements of comprehensive income. | |||||
Significant risks and uncertainties | |||||
Foreign currency risk | |||||
RMB is not a freely convertible currency. The State Administration for Foreign Exchange, under the authority of the People’s Bank of China, controls the conversion of RMB into foreign currencies. The value of RMB is subject to changes in central government policies and to international economic and political developments affecting supply and demand in the China Foreign Exchange Trading System market. The cash and cash equivalents of the Group from the continuing operations and discontinued operations included aggregate amounts of US$36,360 and US$68,867, which were denominated in RMB, at September 30, 2012 and 2013, respectively, representing 73.1% and 95.8% of the cash and cash equivalents at September 30, 2012 and 2013, respectively. | |||||
Concentration of credit risk | |||||
Financial instrument that potentially expose the Group to significant concentration of credit risk primarily consist of cash and cash equivalents, term deposits, and accounts receivable. As of September 30, 2013, substantially all of the Group’s cash and cash equivalents and term deposits were deposited in financial institutions located in the PRC and Hong Kong. Accounts receivable are typically unsecured and are derived from revenue earned from customers in the PRC. The risk with respect to accounts receivable is mitigated by credit evaluations the Group performs on its customers and its ongoing monitoring process of outstanding balances. | |||||
There are no revenues from customers which individually represent greater than 10% of the total net revenues for any year of the three years period ended September 30, 2013. | |||||
Primarily due to the long payment cycles of government agencies, the Group had one customer that accounted for 43.7% of the Group’s accounts receivable balances as of September 30, 2012, respectively, and only one customer that accounted for 46.3% of the Group’s accounts receivable balances as of September 30, 2013. | |||||
Recently issued accounting pronouncements not yet adopted | |||||
In March 2013, the FASB issued an authoritative pronouncement related to 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. When a reporting entity (parent) 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, the parent is required to release any related cumulative translation adjustment into net income. Accordingly, the cumulative translation adjustment should be released into net income only if the sale or transfer results in the complete or substantially complete liquidation of the foreign entity in which the subsidiary or group of assets had resided. | |||||
For an equity method investment that is a foreign entity, the partial sale guidance still applies. As such, a pro rata portion of the cumulative translation adjustment should be released into net income upon a partial sale of such an equity method investment. However, this treatment does not apply to an equity method investment that is not a foreign entity. In those instances, the cumulative translation adjustment is released into net income only if the partial sale represents a complete or substantially complete liquidation of the foreign entity that contains the equity method investment. | |||||
Additionally, the amendments in this pronouncement clarify that the sale of an investment in a foreign entity includes both: (1) events that result in the loss of a controlling financial interest in a foreign entity (i.e., irrespective of any retained investment); and (2) events that result in an acquirer obtaining control of an acquiree in which it held an equity interest immediately before the acquisition date (sometimes also referred to as a step acquisition). Accordingly, the cumulative translation adjustment should be released into net income upon the occurrence of those events. | |||||
The amendments in this pronouncement 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 Group does not expect the adoption of this guidance will have a material effect on its consolidated financial statements. | |||||
In July 2013, the FASB issued an Accounting Standard Update (“ASU”) which provides guidance on financial statement presentation of an unrecognized tax benefits when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. The FASB’s objective in issuing this ASU is to eliminate diversity in practice resulting from a lack of guidance on this topic in current U.S. GAAP. | |||||
The amendments in this ASU state 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 carryforward, a similar tax loss, or a tax credit carryforward, except as follows. | |||||
To the extent a net operating loss carryforward, a similar tax loss, or a 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 purpose, the unrecognized tax benefit should be presented in the financial statements as a liability and should not be combined with deferred tax assets. | |||||
This ASU applies to all entities that have unrecognized tax benefits when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists at the reporting date. The amendments in this ASU 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 Group does not expect the adoption of this guidance will have a material effect on its consolidated financial statements. |
TRANSACTIONS_IN_CONNECTION_WIT
TRANSACTIONS IN CONNECTION WITH ACQUIRED BUSINESS | 12 Months Ended | ||||||
Sep. 30, 2013 | |||||||
TRANSACTIONS IN CONNECTION WITH ACQUIRED BUSINESS | ' | ||||||
3 | TRANSACTIONS IN CONNECTION WITH ACQUIRED BUSINESS | ||||||
Zhengbao Yucai | |||||||
On March 10, 2009, Beijing Champion acquired the business of start-up training services from Beijing Yinglun Yucai Education Consulting Co., Ltd. (“Yinglun Yucai”) which was owned by Mr. Liang Ma. The acquired business is operated by Zhengbao Yucai, an entity established by Beijing Champion. Upon the completion of the acquisition, Beijing Champion transferred 40% equity interest of Zhengbao Yucai to Mr. Liang Ma. | |||||||
The initial consideration for this acquisition was US$5,318 in cash, including US$56 of transaction costs, of which US$5,314 and US$4 were paid during the years ended September 30, 2009 and 2010 respectively. | |||||||
In addition, the purchase agreement provided for further contingent consideration to be paid or received by Beijing Champion as follows: | |||||||
• | For the fiscal year of 2009, if Zhengbao Yucai had a net income greater than RMB22,500 (approximately US$3,296), Beijing Champion would pay Mr. Liang Ma an additional cash consideration equal to 40% of the excess amount of net income over RMB22,500. | ||||||
• | For the fiscal year of 2010, if Zhengbao Yucai had a net income greater than RMB47,000 (approximately US$6,881), Beijing Champion would pay Mr. Liang Ma an additional cash consideration equal to 30% of the excess amount of net income over RMB47,000. | ||||||
• | If Zhengbao Yucai’s net income for the fiscal year of 2009 was less than RMB22,500 or for the fiscal year of 2010 was less than RMB47,000, Mr. Liang Ma would pay Beijing Champion a specified amount of cash which Mr. Liang Ma may settle in stock of Zhengbao Yucai. | ||||||
The purchase agreement also included the following call and put options: | |||||||
• | If Zhengbao Yucai had a net loss for the fiscal year of 2009 or 2010, Beijing Champion had the option to sell its equity interest of Zhengbao Yucai back to Mr. Liang Ma for RMB43,200 in cash. | ||||||
• | Beijing Champion had the option to acquire an additional 30% equity interest of Zhengbao Yucai in the next 5 years starting from the end of the fiscal year 2009 at a price equal to 30% of six times of the net income of Zhengbao Yucai for the preceding fiscal year. Zhengbao Yucai had the option to acquire up to 49% equity interest of Beijing Yinhong International Education Consulting Co. Ltd. (“Yinhong”), owned by Yinglun Yucai, within 3 years starting from February 15, 2009 at a price up to 49% of six times of the net income of Yinhong for the preceding fiscal year. | ||||||
The following table presents the allocation of the purchase price to the fair values of the portion of the assets acquired and liabilities assumed on March 10, 2009, which were determined by the Group with the assistance of an independent valuation firm. | |||||||
US$ | Amortization | ||||||
period | |||||||
Cash | 2,854 | ||||||
Property, plant and equipment | 138 | ||||||
Purchased call options | 1,221 | ||||||
Other intangible assets: | |||||||
Business contracts | 476 | 3~5 years | |||||
Copyrights | 586 | 5 years | |||||
Platform | 195 | 3.5 years | |||||
Domain names | 168 | 10~11 years | |||||
Software | 311 | 3 years | |||||
Courseware | 255 | 5 years | |||||
Deferred tax liability | (382 | ) | |||||
Noncontrolling interest | (2,107 | ) | |||||
Goodwill | 1,603 | ||||||
Total consideration | 5,318 | ||||||
Zhengbao Yucai incurred net losses for the fiscal years of 2009 and 2010. In addition, the Group noted that Mr. Liang Ma, the selling equity holder of Zhengbao Yucai, Yinglun Yucai, a company owned by Mr. Liang Ma, and Global Education Consortium Group Co., Limited, a company owned by Mr. Liang Ma’s wife engaged in competing businesses which is prohibited under the purchase agreement. | |||||||
In January 2010, the Group filed an arbitration application with the China International Economic and Trade Arbitration Commission (“CIETAC”), against Mr. Liang Ma and its related parties (“the respondents”) for breach of the original purchase agreement. | |||||||
As of September 30, 2010, the option to acquire equity interest in Yinhong was fully impaired by US$34 and the option to acquire equity interest in Zhengbao Yucai was impaired by US$128 for the year ended September 30, 2010. | |||||||
On June 1, 2011, the CIETAC awarded the Group (i) US $571 compensation from the respondents, which was received on July 27, 2011 and was recorded as other operating income, and (ii) 40% equity interest of Zhengbao Yucai with no consideration from Mr. Liang Ma, which was recorded as equity transaction with no gain or loss recognized (see Note 17). Thereafter, the Group fully impaired the option to acquire equity interest in Zhengbao Yucai by US$1,115 to nil. | |||||||
Champion Xinlixiang | |||||||
On September 30, 2009, Champion Wangge acquired the Gaokao retake business from Mr. Junnan Ye and Mr. Xiujie Hu, two third-party individuals. The acquired business is operated by Champion Xinlixiang, an entity established by Champion Wangge. Upon the completion of the acquisition, Champion Wangge transferred 40% equity interest of Champion Xinlixiang to Mr. Junnan Ye and Mr. Xiujie Hu. | |||||||
The initial consideration for this acquisition was US$2,379 in cash (RMB16,000), including US$37 of transaction costs, which was fully settled in the fiscal year of 2011. | |||||||
In addition, the purchase agreement provided for further contingent consideration to be paid or received by Champion Wangge as follows: | |||||||
• | For the fiscal year of 2010, if Champion Xinlixiang had a net income greater than RMB8,000 (approximately US$1,172), Champion Wangge would pay Mr. Junnan Ye and Mr. Xiujie Hu an additional cash consideration equal to 40% of the excess amount of net income over RMB8,000. | ||||||
• | For the fiscal year of 2011, if Champion Xinlixiang had a net income greater than RMB16,000 (approximately US$2,344), Champion Wangge would pay Mr. Junnan Ye and Mr. Xiujie Hu an additional cash consideration equal to 30% of the excess amount of net income over RMB16,000. | ||||||
• | If Champion Xinlixiang’s net income for the fiscal year of 2010 was less than RMB8,000 or for the fiscal year of 2011 was less than RMB16,000, Mr. Junnan Ye and Mr. Xiujie Hu would pay Champion Wangge a specified amount of cash which Mr. Junnan Ye and Mr. Xiujie Hu may settle in stock of Champion Xinlixiang. | ||||||
The purchase agreement also included the following call and put options: | |||||||
• | If Champion Xinlixiang had a net loss for the fiscal year of 2010 or 2011, Champion Wangge had the option to sell its equity interest of Champion Xinlixiang back to Mr. Junnan Ye and Mr. Xiujie Hu for RMB19,200 in cash. | ||||||
• | Champion Wangge, beginning October 1, 2011, had the option to acquire an additional 40% equity interest of Champion Xinlixiang at a price equal to 40% of six times of the net income of Champion Xinlixiang for the preceding fiscal year. Mr. Junnan Ye and Mr. Xiujie Hu, beginning October 1, 2011, had the right to request Champion Wangge to purchase their equity interest of Champion Xinlixiang at the same price. Upon the refusal of Champion Wangge, the sellers had the right to sell their equity interest of Champion Xinlixiang to a third party at a price no lower than Champion Wangge’s purchase price. | ||||||
The following table presents the allocation of the purchase price to the fair values of the portion of the assets acquired and liabilities assumed on September 30, 2009, which were determined by the Group with the assistance of an independent valuation firm. | |||||||
US$ | Amortization | ||||||
period | |||||||
Accounts receivable | 1,968 | ||||||
Purchased call option | 669 | ||||||
Other intangible assets: | |||||||
Non-compete agreement | 650 | 15 years | |||||
Supplementary domain names | 1 | 10 years | |||||
Deferred revenue | (1,617 | ) | |||||
Deferred tax liability | (330 | ) | |||||
Income tax payable | (61 | ) | |||||
Other payables | (107 | ) | |||||
Noncontrolling interest | (937 | ) | |||||
Goodwill | 2,143 | ||||||
Total consideration | 2,379 | ||||||
As Champion Xinlixiang incurred a net loss in the year ended September 30, 2010, pursuant to the terms of the original purchase agreement, the selling equity holders surrendered their 40% equity interest of US$911 in Champion Xinlixang to the Group for no consideration on October 1, 2010 (see Note 17). As a result, the purchased call option was impaired by US$477 and US$201 in the years ended September 30, 2010 and 2011, respectively. | |||||||
On September 27, 2011, the Group decided to discontinue its Gaokao retake education services business, and this operation was subsequently disposed on May 4, 2012 (see Note 4). |
DISCONTINUED_OPERATIONS
DISCONTINUED OPERATIONS | 12 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
DISCONTINUED OPERATIONS | ' | ||||||||
4 | DISCONTINUED OPERATIONS | ||||||||
Gaokao retake business operated by Champion Xinlixiang has been in a loss position. As a result, on September 27, 2011, the Company decided to discontinue operations of Gaokao retake business and put the related assets and business up for sale. On May 4, 2012, the Company completed the sale of this operation for total cash proceeds of US$157. The assets sold consisted primarily of cash and cash equivalents, accounts receivable, property and equipment, prepayment and other assets. The buyer also assumed certain income tax payable, deferred revenue and accrued liabilities and other liabilities. | |||||||||
In conjunction with the discontinuance of operations, the Company recorded an impairment loss of US$2,063 in the year ended September 30, 2011 to write down the related carrying amounts of its assets to their fair values less cost to sell (see Note 11). | |||||||||
The following is a summary of the assets and liabilities sold as of May 4, 2012 and the related gain on disposal: | |||||||||
Disposed as of | |||||||||
May 4, | |||||||||
2012 | |||||||||
US$ | |||||||||
Current assets of discontinued operations: | |||||||||
Cash and cash equivalents | 312 | ||||||||
Accounts receivable, net | 14 | ||||||||
Prepayment and other current assets | 324 | ||||||||
650 | |||||||||
Current liabilities of discontinued operations: | |||||||||
Accrued expenses and other liabilities | 348 | ||||||||
Income tax payable | 128 | ||||||||
Deferred revenue, current portion | 314 | ||||||||
790 | |||||||||
Net liabilities disposed | (140 | ) | |||||||
Cash proceeds | 157 | ||||||||
Gain on disposition of the discontinued operation | 297 | ||||||||
Summarized operating results from the discontinued operations included in the Group’s consolidated statements of operations were as follows for the years ended September 30, 2011 and 2012: | |||||||||
Years ended September 30, | |||||||||
2011 | 2012 | ||||||||
US$ | US$ | ||||||||
Revenues | 1,776 | 1,045 | |||||||
Pre-tax profit (loss) from discontinued operations | (3,444 | ) | (61 | ) | |||||
Income tax expense | 144 | — | |||||||
Income (loss) from discontinued operations, net of tax | (3,300 | ) | (61 | ) | |||||
Gain on disposal of discontinued operation | — | 297 | |||||||
Net (loss) income from discontinued operations attributable to China Distance Education Holding Limited, net of tax | (3,300 | ) | 236 | ||||||
All notes to the accompanying consolidated financial statements have reflected the effect of the discontinued operations, where applicable. |
ACCOUNTS_RECEIVABLE_NET
ACCOUNTS RECEIVABLE, NET | 12 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
ACCOUNTS RECEIVABLE, NET | ' | ||||||||
5 | ACCOUNTS RECEIVABLE, NET | ||||||||
Accounts receivable, net consisted of the following: | |||||||||
As of September 30, | |||||||||
2012 | 2013 | ||||||||
US$ | US$ | ||||||||
Accounts receivable | 6,173 | 5,291 | |||||||
Less: allowance for doubtful accounts | (2,092 | ) | (1,773 | ) | |||||
Accounts receivable, net | 4,081 | 3,518 | |||||||
Movement of allowance for doubtful accounts was as follows: | |||||||||
As of September 30, | |||||||||
2012 | 2013 | ||||||||
US$ | US$ | ||||||||
Balance at beginning of year | 3,190 | 2,092 | |||||||
Charged to expenses | 211 | (371 | ) | ||||||
Write-off of accounts receivable | (1,361 | ) | — | ||||||
Foreign currency adjustment | 52 | 52 | |||||||
Balance at end of the year | 2,092 | 1,773 | |||||||
INVENTORIES_NET
INVENTORIES, NET | 12 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
INVENTORIES, NET | ' | ||||||||
6 | INVENTORIES, NET | ||||||||
Inventories consisted of the following: | |||||||||
As of September 30, | |||||||||
2012 | 2013 | ||||||||
US$ | US$ | ||||||||
Books and other goods | 632 | 708 | |||||||
Paper and other raw materials | 70 | 102 | |||||||
Less: inventory provisions for slow-moving and obsolescence | (44 | ) | (112 | ) | |||||
658 | 698 | ||||||||
Inventories provision made in the years ended September 30, 2011, 2012 and 2013 were US$1, US$41 and US$67, respectively. |
PREPAYMENT_AND_OTHER_CURRENT_A
PREPAYMENT AND OTHER CURRENT ASSETS | 12 Months Ended | ||||||||||||
Sep. 30, 2013 | |||||||||||||
PREPAYMENT AND OTHER CURRENT ASSETS | ' | ||||||||||||
7 | PREPAYMENT AND OTHER CURRENT ASSETS | ||||||||||||
Prepayment and other current assets consisted of the following: | |||||||||||||
As of September 30, | |||||||||||||
Notes | 2012 | 2013 | |||||||||||
US$ | US$ | ||||||||||||
Advance to the suppliers | (1) | 1,835 | 1,873 | ||||||||||
Prepaid expenses | 1,092 | 1,034 | |||||||||||
Refundable prepayments | (2) | 325 | — | ||||||||||
Current portion of receivables related to ITAT program (Note 13) | — | 285 | |||||||||||
Funds receivable | (3) | 142 | 285 | ||||||||||
Deposits | 68 | 11 | |||||||||||
Others | 436 | 599 | |||||||||||
Less: allowance for doubtful accounts | (2) | (325 | ) | — | |||||||||
Prepayment and other current assets, net | 3,573 | 4,087 | |||||||||||
-1 | Advance to the suppliers represents interest-free cash deposits paid to suppliers for future purchase of raw materials and finished goods. The risk of loss arising from non-performance by or bankruptcy of the suppliers is assessed prior to making the deposits and is monitored on a regular basis by management. A charge to cost of sales will be recorded in the period in which a loss is incurred. To date, the Group has not experienced any loss of advances to suppliers. | ||||||||||||
-2 | The group prepaid a refundable fee to a government agency in the year ended September 30, 2010 as a sponsor of ITAT contest which was subsequently cancelled. In 2013, the Group and the government agency agreed to cease a series of cooperations on ITAT program, including ITAT contest. Based on the termination agreement, the Group waived the amount of US$325 related to the sponsorship of ITAT contest and accordingly wrote off the refundable prepayments in 2013. The Group recorded a full allowance for such prepaid amount in 2012. | ||||||||||||
-3 | Funds receivable arise due to the time taken to clear customers’ payment transactions through external payment networks. When customers remit fees to the Group via external payment networks using their bank account or credit card, there is a clearing period before the cash is received by the Group which usually takes one to three business days. These fees are treated as a receivable until the cash is received. |
PROPERTY_PLANT_AND_EQUIPMENT_N
PROPERTY, PLANT AND EQUIPMENT, NET | 12 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
PROPERTY, PLANT AND EQUIPMENT, NET | ' | ||||||||
8 | PROPERTY, PLANT AND EQUIPMENT, NET | ||||||||
Property, plant and equipment consisted of the following: | |||||||||
As of September 30, | |||||||||
2012 | 2013 | ||||||||
US$ | US$ | ||||||||
Buildings | 5,892 | 6,051 | |||||||
Electronic and office equipment | 7,604 | 9,523 | |||||||
Leasehold improvement and building improvement | 1,434 | 681 | |||||||
Motor vehicles | 1,106 | 1,164 | |||||||
Total | 16,036 | 17,419 | |||||||
Less: Accumulated depreciation | (6,360 | ) | (7,217 | ) | |||||
9,676 | 10,202 | ||||||||
Depreciation expenses from continuing operations were US$1,309, US$1,606 and US$1,848, and from discontinued operations were US$140, nil and nil, for the years ended September 30, 2011, 2012 and 2013, respectively. |
GOODWILL
GOODWILL | 12 Months Ended | ||||||||||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||||||||||
GOODWILL | ' | ||||||||||||||||||||||||||||
9 | GOODWILL | ||||||||||||||||||||||||||||
Goodwill was comprised of the following: | |||||||||||||||||||||||||||||
Year ended September 30 | |||||||||||||||||||||||||||||
2012 | 2013 | ||||||||||||||||||||||||||||
Gaokao re-take | |||||||||||||||||||||||||||||
Online | Start-up | business - | Online | Start-up | |||||||||||||||||||||||||
education | training | discontinued | education | training | |||||||||||||||||||||||||
service | service | operations | Total | service | service | Total | |||||||||||||||||||||||
US$ | US$ | US$ | US$ | US$ | US$ | US$ | |||||||||||||||||||||||
Gross amount | |||||||||||||||||||||||||||||
Beginning balance | 5,642 | 1,761 | 2,262 | 9,665 | 5,726 | 1,785 | 7,511 | ||||||||||||||||||||||
Exchange difference | 84 | 24 | — | 108 | 154 | 46 | 200 | ||||||||||||||||||||||
Disposal | — | — | (2,262 | ) | (2,262 | ) | — | — | — | ||||||||||||||||||||
Ending balance | 5,726 | 1,785 | — | 7,511 | 5,880 | 1,831 | 7,711 | ||||||||||||||||||||||
Accumulated impairment loss | |||||||||||||||||||||||||||||
Beginning balance | — | — | (2,262 | ) | 2,262 | — | — | — | |||||||||||||||||||||
Charge for the year | — | — | — | — | — | — | — | ||||||||||||||||||||||
Exchange difference | — | — | — | — | — | — | — | ||||||||||||||||||||||
Disposal | — | — | (2,262 | ) | (2,262 | ) | — | — | — | ||||||||||||||||||||
Ending balance | — | — | — | — | — | — | — | ||||||||||||||||||||||
Goodwill, net | 5,726 | 1,785 | — | 7,511 | 5,880 | 1,831 | 7,711 | ||||||||||||||||||||||
The Group tested its goodwill for impairment at the following reporting units level. | |||||||||||||||||||||||||||||
Online education service - This reporting unit provides online education services to its customers located in the PRC. It includes all the subsidiaries, the VIE and VIE’s subsidiaries of the Group except for Zhengbao Yucai and Champion Xinlixiang. The goodwill arising from the acquisitions of the entities under this reporting unit is fully allocated to this reporting unit. | |||||||||||||||||||||||||||||
Start-up training service - This reporting unit provides start-up training services to the Group’s customers located the PRC. It includes Zhengbao Yucai. The goodwill arising from the acquisitions of Zhengbao Yucai is fully allocated to this reporting unit. | |||||||||||||||||||||||||||||
Goodwill is tested for impairment annually or more frequently if events or changes in circumstances indicate that it might be impaired. The Group has not recorded any impairment of goodwill on online education service and start-up training service. | |||||||||||||||||||||||||||||
The reporting unit of Gaokao retake business acquired with the acquisition of Champion Xinlixiang was discontinued and accordingly the related goodwill was fully impaired in the year ended September 30, 2011. (See Note 4) |
OTHER_INTANGIBLE_ASSETS_NET
OTHER INTANGIBLE ASSETS, NET | 12 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
OTHER INTANGIBLE ASSETS, NET | ' | ||||||||
10 | OTHER INTANGIBLE ASSETS, NET | ||||||||
Other intangible assets consisted of the following: | |||||||||
As of September 30, | |||||||||
2012 | 2013 | ||||||||
US$ | US$ | ||||||||
Computer software | 2,645 | 2,978 | |||||||
Trademarks and domain names | 1,407 | 1,456 | |||||||
Website | 103 | 106 | |||||||
Courseware | 475 | 488 | |||||||
Business contracts | 517 | 531 | |||||||
Copyrights | 647 | 664 | |||||||
Platform | 211 | 217 | |||||||
Total intangible assets | 6,005 | 6,440 | |||||||
Less: Accumulated amortization | |||||||||
Computer software | (1,827 | ) | (2,275 | ) | |||||
Trademarks and domain names | (717 | ) | (840 | ) | |||||
Website | (102 | ) | (106 | ) | |||||
Courseware | (394 | ) | (462 | ) | |||||
Business contracts | (399 | ) | (494 | ) | |||||
Copyrights | (455 | ) | (600 | ) | |||||
Platform | (182 | ) | (187 | ) | |||||
Accumulated amortization | (4,076 | ) | (4,964 | ) | |||||
Intangible assets, net | 1,929 | 1,476 | |||||||
Amortization expenses from continuing operations were US$900, US$873 and US$771 and from discontinued operations were US$26, nil and nil, for the years ended September 30, 2011, 2012 and 2013, respectively. | |||||||||
The estimated amortization expenses for the above other intangible assets for each of the following fiscal years are as follows | |||||||||
Amortization | |||||||||
US$ | |||||||||
2014 | 491 | ||||||||
2015 | 348 | ||||||||
2016 | 277 | ||||||||
2017 | 211 | ||||||||
2018 | 82 | ||||||||
2019 and thereafter | 67 | ||||||||
1,476 | |||||||||
FAIR_VALUE_MEASUREMENT
FAIR VALUE MEASUREMENT | 12 Months Ended | |
Sep. 30, 2013 | ||
FAIR VALUE MEASUREMENT | ' | |
11 | FAIR VALUE MEASUREMENT | |
The Group’s financial instruments consist of cash equivalents, term deposits, restricted cash, accounts receivable, other current assets, and other current liabilities. The carrying amounts of these instruments approximate their fair values due to their short-term maturity. | ||
The Group reviews goodwill for impairment annually or more frequently if events or changes in circumstances indicate the possibility of impairment. For the continuing operations, other intangible assets, purchased call options and other long-lived assets are measured at fair value on a nonrecurring basis when there is an indicator of impairment, and they are recorded at fair value only when impairment is recognized. For discontinued operations, long-lived assets are measured at the lower of carrying amount or fair value less cost to sell. The fair value of these assets were determined using models with significant unobservable inputs which were classified as Level 3 inputs, primarily the discounted future cash flow. | ||
In the year ended September 30, 2011, the purchased call options acquired with the acquisitions of Zhengbao Yucai and Champion Xinlixiang were impaired by US$1,115 and US$201 to write them down to zero, because the Group acquired the additional 40% equity interest of Zhengbao Yucai and Champion Xinlixiang, respectively, in 2011 with no consideration (See Note 3). | ||
Due to continuous loss, on September 27, 2011, the Company decided to discontinue operations of Gaokao retake business, and put the related assets and business up for sale. As a result, goodwill related to Gaokao retake business was impaired by US$758 and written down to zero in the year ended September 30, 2011 (See Note 4). In addition, measured at the lower of carrying amount or fair value less cost to sell, the property, plant and equipment, and non-compete agreement of Gaokao retake business were impaired by US$973 and US$332 during the year ended September 30, 2011, respectively. |
DEPOSITS_FOR_PURCHASE_OF_NONCU
DEPOSITS FOR PURCHASE OF NON-CURRENT ASSETS | 12 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
DEPOSITS FOR PURCHASE OF NON-CURRENT ASSETS | ' | ||||||||
12 | DEPOSITS FOR PURCHASE OF NON-CURRENT ASSETS | ||||||||
Deposits for purchase of non-current assets consisted of the following: | |||||||||
As of September 30, | |||||||||
2012 | 2013 | ||||||||
US$ | US$ | ||||||||
Deposit for purchase of property, plant and equipment | 131 | 374 | |||||||
131 | 374 | ||||||||
OTHER_NONCURRENT_ASSETS
OTHER NON-CURRENT ASSETS | 12 Months Ended | ||||||||||
Sep. 30, 2013 | |||||||||||
OTHER NON-CURRENT ASSETS | ' | ||||||||||
13 | OTHER NON-CURRENT ASSETS | ||||||||||
Other non-current assets consisted of the following: | |||||||||||
As of September 30, | |||||||||||
2012 | 2013 | ||||||||||
US$ | US$ | ||||||||||
Long-term prepaid expenses | -1 | 462 | 1,207 | ||||||||
Long-term receivables | -2 | 504 | 171 | ||||||||
Rental deposits | -3 | 125 | 168 | ||||||||
1,091 | 1,546 | ||||||||||
-1 | Long-term prepaid expenses represent golf club membership fee valid for a period of ten years. The amortization of the long term prepaid expenses was included in “general and administrative expenses” on the consolidated statements of operations. | ||||||||||
-2 | Long-term receivables represent the non-current portion of prepaid service fee for obtaining government authorization to provide the ITAT program, an information technique application training program, for ten years, starting from 2010. The group amortized such prepayment on a straight-line basis. In 2013, the Group ceased a series of cooperation on ITAT program. Based on the termination agreement signed in July 2013, the remaining unamortized prepaid service fee will be repaid within next 48 months. Accordingly, as of September 30, 2013, US$285 and US$171 were recorded as current portion and non-current portion of receivables due from the government agency respectively (see Note 7). | ||||||||||
-3 | Rental deposits represent office rental deposits for the Group’s daily operations. These deposits are classified as non-current deposits since they will not be refunded within one year. |
ACCRUED_EXPENSES_AND_OTHER_LIA
ACCRUED EXPENSES AND OTHER LIABILITIES | 12 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
ACCRUED EXPENSES AND OTHER LIABILITIES | ' | ||||||||
14 | ACCRUED EXPENSES AND OTHER LIABILITIES | ||||||||
The components of accrued expenses and other liabilities are as follows: | |||||||||
As of September 30, | |||||||||
2012 | 2013 | ||||||||
US$ | US$ | ||||||||
Accrued expenses | 2,597 | 2,795 | |||||||
Salary and welfare payable | 1,823 | 2,775 | |||||||
Tuition fee payables to government agencies | 2,765 | 5,132 | |||||||
Remuneration payable to lecturers | 1,883 | 2,314 | |||||||
Uncertain income tax liabilities (Note 18) | 173 | 177 | |||||||
Payables to employees in connection with options exercise | — | 458 | |||||||
Other payable | 395 | 1,421 | |||||||
9,636 | 15,072 | ||||||||
Tuition fee payable to government agencies mainly represents the portion of tuition fee collected by the Group on behalf of the government agencies which provide accounting continuing education courses and the Group is only responsible for the student recruiting and provision of online platform and shares certain percentage of fee tuition as service fees. |
ORDINARY_SHARES
ORDINARY SHARES | 12 Months Ended | |
Sep. 30, 2013 | ||
ORDINARY SHARES | ' | |
15 | ORDINARY SHARES | |
On November 20, 2008, the Company’s board of directors approved a share repurchase program effective November 20, 2008. Under the approved program, the Company is authorized to repurchase up to US$10 million worth of its issued and outstanding ADSs from time to time in open-market transactions on NYSE. On April 29, 2011, the Company’s board of directors approved additional share repurchase up to US$10 million worth of its issued and outstanding ADSs. During the years ended September 30, 2011, 2012 and 2013, the Company repurchased 9,223,188, 1,285,464 and 67,100 ordinary shares for total considerations of US$8,138, US$993 and US$93, respectively. Such shares were immediately canceled after the repurchase. |
RESTRICTED_NET_ASSETS
RESTRICTED NET ASSETS | 12 Months Ended | |
Sep. 30, 2013 | ||
RESTRICTED NET ASSETS | ' | |
16 | RESTRICTED NET ASSETS | |
Relevant PRC statutory laws and regulations permit payments of dividends by the Group’s PRC subsidiaries only out of their retained earnings, if any, as determined in accordance with PRC accounting standards and regulations. The results of operations reflected in the financial statements prepared in accordance with U.S. GAAP differ from those reflected in the statutory financial statements of the Company’s subsidiaries. | ||
In accordance with the Regulations on Enterprises with Foreign Investment of China and their articles of association, a foreign invested enterprise established in the PRC is required to provide certain statutory reserves, namely general reserve fund, the enterprise expansion fund and staff welfare and bonus fund which are appropriated from net profit as reported in the enterprise’s PRC statutory accounts, which is included in retained earnings/(cumulative deficits) accounts in equity section of the consolidated balance sheets. A wholly-owned foreign invested enterprise is required to allocate at least 10% of its annual after-tax profit to the general reserve until such reserve has reached 50% of its respective registered capital based on the enterprise’s PRC statutory accounts. Appropriations to the enterprise expansion fund and staff welfare and bonus fund are at the discretion of the board of directors for all foreign invested enterprises. The aforementioned reserves can only be used for specific purposes and are not distributable as cash dividends. Champion Technology and Champion Education Technology were established as wholly-owned foreign invested enterprises and therefore are subject to the above mandated restrictions on distributable profits. | ||
Additionally, in accordance with the Company Law of the PRC, a domestic enterprise is required to provide statutory common reserve at least 10% of its annual after-tax profit until such reserve has reached 50% of its respective registered capital based on the enterprise’s PRC statutory accounts. A domestic enterprise is also required to provide for discretionary surplus reserve, at the discretion of the board of directors, from the profits determined in accordance with the enterprise’s PRC statutory accounts. The aforementioned reserves can only be used for specific purposes and are not distributable as cash dividends. | ||
As a result of these PRC laws and regulations, the appropriation to the statutory reserve amounted to US$2,388, US$3,206 and US$3,292 for the years ended September 30, 2011, 2012 and 2013, respectively. | ||
As a result of these PRC laws and regulations and the requirement that distributions by the Group’s entities in the PRC can only be paid out of distributable profits reported in accordance with PRC accounting standards, the Group’s entities in the PRC are restricted from transferring a portion of their net assets to the Company. The restricted amounts include the paid-in capital and statutory reserves of the Group’s entities in the PRC. The aggregate amount of paid-in capital and statutory reserves, which represented the amount of net assets of the Group’s entities in the PRC (mainland) not available for distribution, were US$17,835 and US$23,457, as of September 30, 2012 and 2013, respectively. |
NONCONTROLLING_INTERESTS
NONCONTROLLING INTERESTS | 12 Months Ended | ||||||||||||
Sep. 30, 2013 | |||||||||||||
NONCONTROLLING INTERESTS | ' | ||||||||||||
17 | NONCONTROLLING INTERESTS | ||||||||||||
On March 10, 2009, Beijing Champion acquired 60% of the equity interest in start-up training services. On September 30, 2009, Champion Wangge acquired 60% of the equity interest in Gaokao retake business. The Group’s noncontrolling interests represented 40% of the equity interest in start-up training service (Zhengbao Yucai) and Gaokao retake business (Champion Xinlixiang), respectively. | |||||||||||||
On June 1, 2011, the Group obtained 40% equity interest of Zhengbao Yucai through arbitration with no consideration, which was accounted for as equity transaction with no gain or loss recognized. (See Note 3) | |||||||||||||
On October 1, 2010, as Champion Xinlixiang incurred a net loss in year 2010, pursuant to the terms of the original purchase agreement, the selling equity holders transferred their 40% equity interest in Champion Xinlixiang to the Group for no consideration. The acquisition was accounted for as equity transaction with no gain or loss recognized. (See Note 3) | |||||||||||||
Start-up | Gaokao retake | ||||||||||||
training business | business | Total | |||||||||||
US$ | US$ | US$ | |||||||||||
Balance as of September 30, 2010 | 1,126 | 911 | 2,037 | ||||||||||
Net loss for the year | (303 | ) | — | (303 | ) | ||||||||
Foreign currency translation adjustments | 33 | — | 33 | ||||||||||
Acquisition of noncontrolling interest of start-up training business | (856 | ) | — | (856 | ) | ||||||||
Acquisition of noncontrolling interest of Gaokao retake business | — | (911 | ) | (911 | ) | ||||||||
Balance as of September 30, 2011 | — | — | — | ||||||||||
There was no activity with respect to noncontrolling interests in the years ended September 30, 2012 and 2013. |
TAXATION
TAXATION | 12 Months Ended | ||||||||||||
Sep. 30, 2013 | |||||||||||||
TAXATION | ' | ||||||||||||
18 | TAXATION | ||||||||||||
Cayman Islands | |||||||||||||
Under current law of Cayman Islands, the Company is not subject to income or capital gains taxes. In addition, dividends payments are not subject to tax withholding in the Cayman Islands. | |||||||||||||
The United States | |||||||||||||
DL Education was established in the United States and is inactive in the year ended September 30, 2012 and 2013. Therefore there is no income that is subject to the U.S. federal income taxes and state income taxes. | |||||||||||||
Hong Kong | |||||||||||||
CDEL Hong Kong and Pencil have not recorded tax provision for Hong Kong profits tax as the companies have not had assessable profits arising in or derived from Hong Kong. | |||||||||||||
China | |||||||||||||
The Enterprise Income Tax Law (the “EIT Law”) of the PRC, which took effect on January 1, 2008, has applied a uniform 25% enterprise income tax rate to all resident enterprise in China, including foreign invested enterprises. | |||||||||||||
In 2008, Beijing Champion and Champion Technology qualified as “high and new technology enterprise strongly supported by the State” (“HNTE”) under the EIT Law, and therefore, were entitled to preferential income tax rates. Beijing Champion is subject to the tax rate of 15% from 2008 through 2010. Champion Technology is subject to the tax rate of 7.5% for 2008 through 2009 and 15% for 2010. | |||||||||||||
In October 2011, Beijing Champion and Champion Technology renewed the HNTE qualification, and therefore, were continually entitled to the preferential income tax rate of 15% in years 2011 through 2013. | |||||||||||||
Under the EIT Law and its implementation rules, a withholding tax at 10%, unless reduced by a tax treaty or arrangement, is applied on dividends received by non-PRC-resident corporate investors from PRC-resident enterprises, such as the Company’s PRC subsidiaries. Undistributed earnings prior to January 1, 2008 are exempt from such withholding tax. Under the China-HK Tax Arrangement and the relevant regulations, a qualified Hong Kong tax resident which is the “beneficial owner” and holds 25% equity interests or more of a PRC enterprise is entitled to a reduced withholding rate of 5%. The Company believes that CDEL Hong Kong qualifies for the 5% withholding tax rate. CDEL Hong Kong’s deferred tax liabilities related to potential withholding tax were US$634 and US$905 as of September 30, 2012 and 2013, respectively, on the undistributed earnings from its investment in the PRC entities generated after January 1, 2008. And the related income tax expenses were nil, US$634 and US$271 for the years ended September 30, 2011, 2012 and 2013, respectively. | |||||||||||||
In general, the PRC tax authorities have up to five years to conduct examinations of the PRC entities’ tax filings. Accordingly, the PRC entities’ tax years from 2008 to 2012 remain subject to examination by the tax authorities. | |||||||||||||
Income before income taxes from continuing operations consisted of: | |||||||||||||
Years ended September 30, | |||||||||||||
2011 | 2012 | 2013 | |||||||||||
US$ | US$ | US$ | |||||||||||
Non - PRC | (6,873 | ) | (1,252 | ) | (2,003 | ) | |||||||
PRC | 7,039 | 11,825 | 19,364 | ||||||||||
166 | 10,573 | 17,361 | |||||||||||
The current and deferred components of the income tax benefit/(expense) from continuing operations appearing in the consolidated statements of operations are as follows: | |||||||||||||
Years ended September 30, | |||||||||||||
2011 | 2012 | 2013 | |||||||||||
US$ | US$ | US$ | |||||||||||
Current tax expense | 1,948 | 2,074 | 3,107 | ||||||||||
Deferred tax (benefit)/expense | (977 | ) | 526 | 690 | |||||||||
971 | 2,600 | 3,797 | |||||||||||
The reconciliation of the effective tax rate and the statutory income tax rate applicable to PRC operations is as follows: | |||||||||||||
Years ended September 30, | |||||||||||||
2011 | 2012 | 2013 | |||||||||||
US$ | US$ | US$ | |||||||||||
Income before taxes | 166 | 10,573 | 17,361 | ||||||||||
Income tax expense (benefit) computed a applicable tax rates of 25% | 42 | 2,643 | 4,340 | ||||||||||
Effect of different tax rates indifferent jurisdictions | 1,667 | 255 | 440 | ||||||||||
Non-deductible expenses | 260 | 59 | 75 | ||||||||||
Effect of tax holidays | (860 | ) | (1,037 | ) | (1,740 | ) | |||||||
Effect of valuation allowances | (138 | ) | 51 | 194 | |||||||||
Effect of tax rate changes | — | — | 237 | ||||||||||
Withholding tax on undistributed earnings | — | 629 | 251 | ||||||||||
971 | 2,600 | 3,797 | |||||||||||
Effective income tax rate | 584.94 | % | 24.59 | % | 21.87 | % | |||||||
The aggregate amount and per share effect of the tax holidays are as follows: | |||||||||||||
Years ended September 30, | |||||||||||||
2011 | 2012 | 2013 | |||||||||||
US$ | US$ | US$ | |||||||||||
The aggregate amount of tax holidays | 860 | 1,037 | 1,740 | ||||||||||
The aggregate effect on basic and diluted net income per share: | |||||||||||||
- Basic | 0.01 | 0.01 | 0.01 | ||||||||||
- Diluted | 0.01 | 0.01 | 0.01 | ||||||||||
Deferred taxes reflect the tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The components of deferred taxes from continuing operations are as follows: | |||||||||||||
As of September 30, | |||||||||||||
2012 | 2013 | ||||||||||||
US$ | US$ | ||||||||||||
Current deferred tax assets | |||||||||||||
Payroll payable | 291 | 409 | |||||||||||
Accrued expenses | 524 | 585 | |||||||||||
Allowance for doubtful accounts | 592 | 518 | |||||||||||
Net operating loss carry-forwards | 449 | 289 | |||||||||||
Total current deferred tax assets | 1,856 | 1,801 | |||||||||||
Less: valuation allowance | — | (50 | ) | ||||||||||
Current deferred tax assets, net | 1,856 | 1,751 | |||||||||||
Non-current deferred tax assets | |||||||||||||
Intangible assets | 87 | 48 | |||||||||||
Property, plant and equipment | 146 | 148 | |||||||||||
Net operating loss carry-forwards | 522 | 372 | |||||||||||
Total non-current deferred tax assets | 755 | 568 | |||||||||||
Less: valuation allowance | (117 | ) | (262 | ) | |||||||||
Non-current deferred tax assets, net | 638 | 306 | |||||||||||
Non-current deferred tax liabilities | |||||||||||||
Intangible assets | 136 | 78 | |||||||||||
Withholding tax on undistributed earnings | 634 | 905 | |||||||||||
Total non-current deferred tax liabilities | 770 | 983 | |||||||||||
The authoritative guidance requires that the Group recognizes the impact of a tax position in the financial statements if that position is more likely than not of being sustained upon audit by the tax authority, based on the technical merits of the position. Under PRC laws and regulations, arrangements and transactions among related parties may be subject to examination by the PRC tax authorities. If the PRC tax authorities determine that the contractual arrangements among related companies do not represent a price under normal commercial terms, they may make adjustments to the companies’ income and expenses. A transfer pricing adjustment could result in additional tax liabilities. | |||||||||||||
As a result of the Group’s assessment of its tax positions, the unrecognized tax benefit related to transfer price position prior to the year 2009 was recorded at US$170, US$173 and US$177 as of September 30, 2011, 2012 and 2013, respectively. The subsequent changes of the unrecognized tax benefit were due to foreign currency adjustment. | |||||||||||||
Reconciliation of accrued unrecognized tax benefits is as follows: | |||||||||||||
Unrecognized | |||||||||||||
tax benefits | |||||||||||||
Balance - September 30, 2011 | 170 | ||||||||||||
Foreign currency adjustment | 3 | ||||||||||||
Balance - September 30, 2012 | 173 | ||||||||||||
Foreign currency adjustment | 4 | ||||||||||||
Balance - September 30, 2013 | 177 | ||||||||||||
The unrecognized tax benefits would impact the effective tax rate, if recognized in connection with the normal tax return preparation. The Group does not anticipate any significant change in unrecognized tax benefits within 12 months from September 30, 2013. | |||||||||||||
In addition, uncertainties exist with respect to how the current income tax law in the PRC applies to the Group’s overall operations, and more specifically, with regard to tax residency status. The New EIT Law includes a provision specifying that legal entities organized outside of the PRC will be considered residents for Chinese Income tax purposes if the place of effective management or control is within the PRC. The implementation rules to the New EIT Law provide that non-resident legal entities will be considered PRC residents if substantial and overall management and control over the manufacturing and business operations, personnel, accounting and properties, occurs within the PRC. Despite the present uncertainties resulting from the limited PRC tax guidance on the issue, the Group does not believe that the legal entities organized outside of the PRC within the Group should be treated as residents for EIT law purposes. If the PRC tax authorities subsequently determine that the Company and its subsidiaries registered outside the PRC should be deemed resident enterprises, the Company and its subsidiaries registered outside the PRC will be subject to the PRC income taxes, at a rate of 25%. |
EMPLOYEE_DEFINED_CONTRIBUTION_
EMPLOYEE DEFINED CONTRIBUTION PLAN | 12 Months Ended | |
Sep. 30, 2013 | ||
EMPLOYEE DEFINED CONTRIBUTION PLAN | ' | |
19 | EMPLOYEE DEFINED CONTRIBUTION PLAN | |
Full time employees of the Group in the PRC participate in a government mandated defined contribution plan, pursuant to which certain pension benefits, medical care, employee housing fund and other welfare benefits are provided to employees. Chinese labor regulations require that the PRC subsidiaries of the Group make contributions to the government for these benefits based on certain percentages of the employees’ salaries. The Group has no legal obligation for the benefits beyond the contributions made. The total amounts for such employee benefits, which were expensed as incurred, were US$2,464, US$3,199 and US$3,910 for the years ended September 30, 2011, 2012 and 2013, respectively. Employee benefits from continuing operations were US$2,412, US$3,164 and US$3,910, and from discontinued operations were US$52, US$35 and US$nil for the years ended September 30, 2011, 2012 and 2013, respectively. | ||
Obligations for contributions to defined contribution retirement plans for full-time employee in Hong Kong, including contributions payable under the Hong Kong Mandatory Provident Fund Schemes Ordinance, are recognized as expenses in the consolidated statements of operations as incurred. The total amounts for such employee benefits were US$2, US$2 and US$2 for the years ended September 30, 2011, 2012 and 2013, respectively, which were included in continuing operations. |
COMMITMENTS_AND_CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended | ||||
Sep. 30, 2013 | |||||
COMMITMENTS AND CONTINGENCIES | ' | ||||
20 | COMMITMENTS AND CONTINGENCIES | ||||
Operating lease commitments | |||||
Future minimum payments under non-cancelable operating leases related to offices, servers and bandwidth with initial terms of one-year or more consisted of the following at September 30, 2013: | |||||
US$ | |||||
Years ending September 30, | |||||
2014 | 1,637 | ||||
2015 | 80 | ||||
2016 | 58 | ||||
2017 | 5 | ||||
1,780 | |||||
Payments under operating leases are expensed on the straight-line basis over the periods of their respective leases. The terms of the leases do not contain rent escalation or contingent rents. For the years ended September 30, 2011, 2012 and 2013, total rental expenses from continuing operations for all operating leases amounted to US$2,844, US$3,346 and US$3,904, respectively. Rental expenses from discontinued operations for all operating leases amounted to US$750, US$314 and US$nil, respectively. | |||||
Legal contingencies | |||||
The group is a party in potential claims arising in the ordinary course of business. The Group does not believe that the resolution of these matters will have a material effect on its financial position or results of operations. |
SEGMENT_REPORTING
SEGMENT REPORTING | 12 Months Ended | ||||||||||||
Sep. 30, 2013 | |||||||||||||
SEGMENT REPORTING | ' | ||||||||||||
21 | SEGMENT REPORTING | ||||||||||||
The Group operates and manages its business as a single segment that includes primarily the provision of online and offline education services and selling of related products. | |||||||||||||
The revenues attributable to the different service and product groups are as follows: | |||||||||||||
Years ended September 30, | |||||||||||||
2011 | 2012 | 2013 | |||||||||||
US$ | US$ | US$ | |||||||||||
Online education services | 30,788 | 40,281 | 58,573 | ||||||||||
Books and reference materials | 4,743 | 4,438 | 5,129 | ||||||||||
Offline education services | 2,907 | 4,507 | 4,617 | ||||||||||
Others | 3,126 | 2,876 | 3,041 | ||||||||||
41,564 | 52,102 | 71,360 | |||||||||||
Online education services accounted for 74.0%, 77.3% and 82.1% of the Group’s total net revenue for the years ended September 30, 2011, 2012 and 2013, respectively. Any significant reduction in sales from this service could have a substantial negative impact on the Group’s results of operations. | |||||||||||||
Geographic disclosures: | |||||||||||||
As the Group primarily generates its revenues from customers in the PRC, no geographical segments are presented. All of the Group’s long-lived assets are located in the PRC. |
NET_LOSS_INCOME_PER_SHARE
NET (LOSS) INCOME PER SHARE | 12 Months Ended | ||||||||||||
Sep. 30, 2013 | |||||||||||||
NET (LOSS) INCOME PER SHARE | ' | ||||||||||||
22 | NET (LOSS) INCOME PER SHARE | ||||||||||||
Basic and diluted net (loss) income per share for each of the periods presented were calculated as follows: | |||||||||||||
Years ended September 30, | |||||||||||||
2011 | 2012 | 2013 | |||||||||||
US$ | US$ | US$ | |||||||||||
Numerator: | |||||||||||||
Net income (loss) from continuing operations | (502 | ) | 7,973 | 13,564 | |||||||||
Net income (loss) from discontinued operations, net of tax | (3,300 | ) | 236 | — | |||||||||
Net (loss) income | (3,802 | ) | 8,209 | 13,564 | |||||||||
- allocated to ordinary share - basic | (3,800 | ) | 8,209 | 13,554 | |||||||||
- allocated to nonvested restricted share - basic | (2 | ) | — | 10 | |||||||||
Denominator: | |||||||||||||
Weighted average number of ordinary shares outstanding | 133,489,261 | 133,996,737 | 135,174,562 | ||||||||||
Weighted average number of nonvested restricted share | 82,466 | — | 103,082 | ||||||||||
Plus incremental weighted average ordinary shares from assumed exercise of share options using the treasury stock method | — | 366,371 | 1,121,589 | ||||||||||
Weighted average ordinary shares outstanding used in computing diluted net income per share | 133,571,727 | 134,363,108 | 136,399,233 | ||||||||||
Basic net (loss) income per share | |||||||||||||
Basic from continuing operations | — | 0.06 | 0.1 | ||||||||||
Basic from discontinued operations (net of tax) | (0.03 | ) | — | — | |||||||||
Basic | (0.03 | ) | 0.06 | 0.1 | |||||||||
Basic net (loss) income per nonvested restricted share | |||||||||||||
Basic from continuing operations | — | — | 0.1 | ||||||||||
Basic from discontinued operations (net of tax) | (0.03 | ) | — | — | |||||||||
Basic | (0.03 | ) | — | 0.1 | |||||||||
Diluted net (loss) income per share | |||||||||||||
Diluted from continuing operations | — | 0.06 | 0.1 | ||||||||||
Diluted from discontinued operations (net of tax) | (0.03 | ) | — | — | |||||||||
Diluted | (0.03 | ) | 0.06 | 0.1 | |||||||||
SHARE_INCENTIVE_PLAN
SHARE INCENTIVE PLAN | 12 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
SHARE INCENTIVE PLAN | ' | ||||||||||||||||
23 | SHARE INCENTIVE PLAN | ||||||||||||||||
Share options | |||||||||||||||||
On April 18, 2008, the Company’s shareholders approved the “China Distance Education Holdings Limited Share Incentive Plan” (the “Prior Plan”), which permits the grant of share options and shares to its employees and non-employees (the “Participants”). The maximum number of ordinary shares that may be delivered pursuant to compensatory awards granted to the “Participants” under the Prior Plan should not exceed 11,652,556 ordinary shares of par value US$0.0001 per share. On July 2, 2008, the Company’s shareholders approved the “China Distance Education Holdings Limited 2008 Performance Incentive Plan” (the “New Plan”). Subject to any amendment of the New Plan, the maximum number of ordinary shares that may be issued pursuant to the New Plan is equal to 5% of the total number of ordinary shares issued and outstanding as of August 4, 2008, plus an automatic annual increase on October 1 of each calendar year commencing with October 1, 2008, by an amount equal to the lesser of (i) 1% of the total number of ordinary shares issued and outstanding on September 30 of the same calendar year, or (ii) such number of ordinary shares as may be determined by the Company’s board of directors. The purpose of these share incentive plans is to promote the success of the Company and the interests of its shareholders by providing a means through which the Company may grant equity-based incentives to attract, motivate, retain and reward certain officers, employees, directors and other eligible persons and to further link the interests of recipients with those of the Company’s shareholders generally. The Prior Plan will expire on April 17, 2018. The New Plan will expire on the tenth anniversary date of August 4, 2008. Option awards are generally granted with an exercise price equal to the market price of the Company’s stock at the date of grant; those option awards generally vest within 4 years of continuous service and have 10-year contractual terms. Share awards generally vest for 1 year. | |||||||||||||||||
By a resolution of the board of directors on April 18, 2008, 11,652,556 share options were authorized to be granted to certain employees and non-employees. An aggregate of 11,045,500 share options were granted, including a total of 10,060,600 granted to employees on April 18, 2008 and May 31, 2008, and 984,900 granted to non-employees on April 18, 2008 (collectively “the first round”). The share options had an exercise price of US$2.995966 per share and a graded vesting term of four years. For the options granted to non-employees, the Group determined the measurement date to be the performance commitment date pursuant to the service supplemental agreements, in which the penalty for nonperformance was stipulated and represented a sufficiently large disincentive for nonperformance. | |||||||||||||||||
The options would vest as to 25% of the total number of ordinary shares subject to the options on the first anniversary of the vesting commencement date. The remaining 75% of the total number of ordinary shares subject to the options would vest in six substantially equal semi-annual installments, with the first installment vesting on the last day of the sixth month following the month in which the first anniversary of the vesting commencement date occurs and an additional installment vesting on the last day of every six months thereafter. | |||||||||||||||||
On November 17, 2008, the Company’s board of directors and compensation committee approved to provide a compensation package for the non-executive directors. 400,000 options were granted to five directors on December 2, 2008. These options are subject to a two-year vesting schedule with 50% vesting in each year. The exercise price is US$0.82 per share which was determined by the closing price of the Company’s ADSs on NYSE on December 2, 2008. | |||||||||||||||||
On December 2, 2008 (the “repricing date”), the Company’s board of directors and compensation committee approved to amend the terms of certain stock options granted to 260 employees and 17 non-employees to reduce the exercise price of all outstanding share options from US$2.995966 per share to US$0.82 per share based on the closing price of the Company’s ADSs on NYSE on December 2, 2008. The amendments did not change the vesting provisions or the number of shares subject to any of the option awards. This was accounted for as a share option modification and required the remeasurement of the fair value of these share options. This remeasurement resulted in a total incremental share-based compensation of US$2,699, of which US$752 and US$853 were recognized in the year ended September 30, 2009 and 2010, and the remaining is recognized ratably over the remaining vesting period of the award. | |||||||||||||||||
By a resolution of the board of directors on November 17, 2009, 1,361,900 share options were granted to selected employees for an exercise price per share equal to US$1.87. The option shall vest as to 25% of the total number of ordinary shares subject to the option on the first anniversary of the vesting commencement date. The remaining 75% of the total number of ordinary shares subject to the option shall vest in six substantially equal semi-annual installments, with the first installment vesting on the last day of the sixth month following the month in which the first anniversary of the vesting commencement date occurs and an additional installment vesting on the last day of every six months thereafter. | |||||||||||||||||
By a resolution of the board of directors on September 27, 2011, 1,000,600 share options were granted to selected employees with an exercise price per share equal to US$0.615, which was determined by the closing price of the Company’s ADSs on NYSE on September 27, 2011. These options are subject to a two-year vesting schedule with 25% vesting semi-annually. By the same resolution of the board of directors on September 27, 2011, 400,000 fully-vested options were granted to selected directors with an exercise price per share equal to US$0.615, which was determined by the closing price of the Company’s ADSs on NYSE on September 27, 2011. | |||||||||||||||||
Also by that resolution of the board of directors on September 27, 2011, the Company’s board of directors approved to amend the terms of certain stock options granted to 172 employees and 17 non-employees representing 9,465,000 share options. The amendments included (i) reduction of the exercise price of share options from US$0.82 per share to nil for one selected employee, and to reduce the exercise price of share options from US$0.82 per share to US$0.615 per share based on the closing price of the Company’s ADSs on NYSE on September 27, 2011 for the other 171 employees and 17 non-employees; (ii) acceleration of the vesting of share options to fully vested on September 27, 2011; (iii) an option of a three-year interest-free loan for exercising such options. The amendments did not change the vesting provisions or the number of shares subject to any of the option awards. This amendment was accounted for as a share option modification and required the re-measurement of the fair value of these share options. This re-measurement resulted in a total incremental share-based compensation of US$1,658, all of which was recognized in the year ended September 30, 2011. The loans to share option holders in connection with the exercise of options were included in the consolidated statements of changes in equity as a reduction of additional paid-in capital. | |||||||||||||||||
On May 21, 2013, the Company’s board of directors and compensation committee approved to cancel 400,000 options that were granted to the five directors on December 2, 2008 with an exercise price per share equal to US$0.615. Since these options were fully vested and the corresponding share-based compensation was recognized before the cancellation date, no expense related to such options was recorded in the year ended September 30, 2013. | |||||||||||||||||
By the same resolution of the board of directors on May 21, 2013, 720,900 options that were granted to the selected employees on November 17, 2009 with an exercise price per share equal to US$1.87 were cancelled. This cancellation resulted in an immediate recording of the remaining share-based compensation of US$146 in the year ended September 30, 2013. | |||||||||||||||||
A summary of option activity as of September 30, 2013, and changes during the years ended September 30, 2013 are presented below: | |||||||||||||||||
Share option granted to employees and non-executive directors | Number | Weighted- | Weighted- | Aggregated | |||||||||||||
of shares | average | average | intrinsic value | ||||||||||||||
exercise price | remaining | ||||||||||||||||
contractual | |||||||||||||||||
term (years) | |||||||||||||||||
Outstanding, September 30, 2012 | 3,747,024 | US$ | 0.87 | 1 | 7 | — | |||||||||||
Exercised | 964,092 | US$ | 0.61 | ||||||||||||||
Forfeited | 82,300 | US$ | 1.41 | ||||||||||||||
Cancelled | 1,120,900 | US$ | 1.38 | ||||||||||||||
Outstanding, September 30, 2013 | 1,579,732 | US$ | 0.5 | 6.37 | 3,389 | ||||||||||||
Expected to vest, September 30, 2013 | — | — | — | — | |||||||||||||
Exercisable at September 30, 2013 | 1,579,732 | US$ | 0.5 | 6.37 | 3,389 | ||||||||||||
A summary of the activities of the share option granted to non-employees as of September 30, 2013, and changes during the year ended September 30, 2013 are presented below: | |||||||||||||||||
Share option granted to non-employees | Number | Weighted- | Weighted- | Aggregated | |||||||||||||
of shares | average | average | intrinsic | ||||||||||||||
exercise price | remaining | value | |||||||||||||||
contractual | |||||||||||||||||
term (years) | |||||||||||||||||
Outstanding, September 30, 2012 | 151,500 | US$ | 0.62 | 1 | 5.55 | 25 | |||||||||||
Exercised | 23,300 | US$ | 0.495 | ||||||||||||||
Outstanding, September 30, 2013 | 128,200 | US$ | 0.495 | 4.55 | 275 | ||||||||||||
Expected to vest, September 30, 2013 | — | — | — | — | |||||||||||||
Exercisable at September 30, 2013 | 128,200 | US$ | 0.495 | 4.55 | 275 | ||||||||||||
1 | On November 13, 2012, the Company approved and declared a cash dividend of US$0.12 per ordinary share on its outstanding shares to shareholders as of December 7, 2012 and according to the terms of the Prior and New Plan, reduced the exercise price by US$0.12 for all of the outstanding options as of December 7, 2012. The change in exercise price was incurred in the year ended September 30, 2013, and therefore was not reflected in the weighted-average exercise price as of September 30, 2012. | ||||||||||||||||
The total intrinsic value of options exercised during the year ended September 30, 2013 was US$487. As of September 30, 2013, there was no unrecognized share-based compensation cost related to share options since the share options were all fully vested. | |||||||||||||||||
The fair value of each option award to employees and non-employees was estimated using the Black-Scholes Option Pricing Model by the management of the Company. The volatility assumption was estimated based on the price volatility of the shares of comparable companies in the education business because the Company did not have sufficient data to calculate expected volatility of the price of the underlying ordinary shares over the expected term of the option. The expected term was estimated based on the vesting terms, contractual terms and management’s expectation of exercise behavior of the option grantees. The risk-free rate was based on the market yield of China Sovereign Bonds denominated in US$ with maturity terms equal to the expected term of the option awards. The closing market price of the ordinary shares of the Company as of the grant date was used as the fair value of the ordinary shares on that date. | |||||||||||||||||
The Company used the Black Scholes Model to estimate the fair value of the share options on the grant dates with the following assumptions: | |||||||||||||||||
For the year ended | |||||||||||||||||
September 30, | |||||||||||||||||
2011 | |||||||||||||||||
Risk-free interest rate | 1.40% ~ 1.86% | ||||||||||||||||
Dividend yield | — | ||||||||||||||||
Expected volatility | 51% | ||||||||||||||||
Expected life (in years) | 3.71 ~ 5.63 | ||||||||||||||||
Nonvested restricted shares | |||||||||||||||||
On July 2, 2008, the Company’s board of directors approved compensation in total of US$300 to an independent director in exchange for her services to be provided to the Company over a three-year period commencing from July 29, 2008. The US$300 has therefore been recognized as compensation expenses over the three-year period from July 2008 through July 2011. The initial US$100 was paid in the form of 57,143 restricted ordinary shares of the Company in August 2008. The number of restricted ordinary shares was determined based on the closing price of the Company’s ADSs on the issuance date. The remaining US$200 was accrued as a liability and paid in cash of US$100 in November 2009 and July 2010, respectively. | |||||||||||||||||
On December 3, 2010, the Company granted 100,000 nonvested restricted shares of the Company to directors. These shares are restricted on transferability and will be forfeited if the directors cease to provide requisite service to the Company. The restriction will be removed upon the vesting of the nonvested restricted shares on the first anniversary of the issuance day. Before the removal of such restrictions, the holders of the nonvested shares shall be entitled to all rights and privileges of those of ordinary shareholders, and shall be entitled to voting rights and dividends. Therefore, these nonvested shares are considered participating securities for the purpose of net earnings (loss) per share calculation. The grant-date fair value of a nonvested restricted share was US$1.25, which was determined based on the closing price of the Company’s ADSs on NYSE on December 3, 2010. This grant resulted in a total share-based compensation of US$125, which was recognized ratably over the requisite service period of one year. | |||||||||||||||||
On December 3, 2012, the Company granted 225,000 nonvested restricted shares of the Company to directors, of which 100,000 nonvested restricted shares are vested immediately on the grant date and the rest is restricted on transferability and will be forfeited if the directors cease to provide requisite service to the Company. The restriction will be removed upon the vesting of the nonvested restricted shares on the first anniversary of the issuance day. Before the removal of such restrictions, the holders of the nonvested shares shall be entitled to all rights and privileges of those of ordinary shareholders, and shall be entitled to voting rights and dividends. Therefore, these nonvested shares are considered participating securities for the purpose of net earnings (loss) per share calculation. The grant-date fair value of a nonvested restricted share was US$1.22, which was determined based on the closing price of the Company’s ADSs on NYSE on December 3, 2012. This grant resulted in a total share-based compensation of US$276, of which US$122 was recognized immediately on the grand date and US$154 was recognized ratably over the requisite service period of one year. | |||||||||||||||||
A summary of the nonvested restricted shares activity is as follows: | |||||||||||||||||
Number of | Weight average | Aggregated | |||||||||||||||
Nonvested restricted | grant-date | intrinsic value | |||||||||||||||
shares outstanding | fair value | ||||||||||||||||
US$ | |||||||||||||||||
Nonvested restricted shares outstanding at September 30, 2012 | — | — | |||||||||||||||
Granted | 225,000 | 1.22 | |||||||||||||||
Vested | 100,000 | 1.22 | |||||||||||||||
Nonvested restricted shares outstanding at September 30, 2013 | 125,000 | 1.22 | $ | 330 | |||||||||||||
Nonvested restricted shares expected to vest at September 30, 2013 | 125,000 | 1.22 | $ | 330 | |||||||||||||
The total fair value of shares vested during the years ended September 30, 2011, 2012 and 2013 were $125, $nil and $122, respectively. The Company recorded share-based compensation expenses of $104, $21 and $250 for the years ended September 30, 2011, 2012 and 2013, respectively. As of September 30, 2013, there was $26 of share-based compensation related to nonvested shares that is expected to be recognized over a weighted average period of 0.2 year. | |||||||||||||||||
Share-based compensation expense | |||||||||||||||||
Total share-based compensation expense of share-based awards granted to employees, non-employees and non-executive directors recognized for the years ended September 30, 2011, 2012 and 2013 are as follows: | |||||||||||||||||
As of September 30, | |||||||||||||||||
2011 | 2012 | 2013 | |||||||||||||||
US$ | US$ | US$ | |||||||||||||||
Cost of services | 1,999 | 37 | 56 | ||||||||||||||
General and administrative expenses | 3,347 | 88 | 522 | ||||||||||||||
Selling expenses | 678 | 16 | 47 | ||||||||||||||
6,024 | 141 | 625 | |||||||||||||||
CASH_DIVIDEND
CASH DIVIDEND | 12 Months Ended | |
Sep. 30, 2013 | ||
CASH DIVIDEND | ' | |
24 | CASH DIVIDEND | |
On November 16, 2011, the Company approved and declared a cash dividend of US$0.12 per ordinary share on its total 135,565,361 outstanding shares as of the close of trading on December 15, 2011, resulting in payments totaling US$16,268 to shareholders. Such dividend was recorded as a reduction to additional paid-in capital since the Company had cumulative deficits at the declaration date. | ||
On November 13, 2012, the Company approved and declared a cash dividend of US$0.12 per ordinary share on its total 135,409,521 outstanding shares as of the close of trading on December 7, 2012, resulting in payments totaling US$16,056 to shareholders. Such dividend was recorded as a reduction to additional paid-in capital since the Company had cumulative deficits at the declaration date. |
SUBSEQUENT_EVENTS
SUBSEQUENT EVENTS | 12 Months Ended | |
Sep. 30, 2013 | ||
SUBSEQUENT EVENTS | ' | |
25 | SUBSEQUENT EVENTS | |
On November 20, 2013, the Company approved and declared a cash dividend of US$0.15 per ordinary share on its outstanding shares to shareholders of record as of the close of trading on January 8, 2014. According to the dividend protection terms of the Prior and New Plan, and approved by the Company, the exercise price of all of the outstanding options as of January 8, 2014 will be reduced by US$0.15 per share, which is a change in exercise price pursuant to the Prior and New Plan and therefore will not be treated as a share option modification. | ||
On December 6, 2013, CDEL Hong Kong entered into a loan agreement with Deutsche Bank, AG, Singapore Branch, for a RMB100 million, approximately US$16 million, term loan facility with an 2.40% annual interest rate for a term of 18 months. The facility will be secured by a term deposit of RMB100 million to be provided by Champion Technology. The Company expects to draw down the loan in January 2014. |
Financial_Statement_Schedule_I
Financial Statement Schedule I | 12 Months Ended | ||||||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||||||
Financial Statement Schedule I | ' | ||||||||||||||||||||||||
CHINA DISTANCE EDUCATION HOLDINGS LIMITED | |||||||||||||||||||||||||
Additional Information - Financial Statement Schedule I | |||||||||||||||||||||||||
Condensed Financial Information of Parent Company | |||||||||||||||||||||||||
BALANCE SHEETS | |||||||||||||||||||||||||
(U.S. dollars in thousands, except share data and per share data, or otherwise noted) | |||||||||||||||||||||||||
As of September 30, | |||||||||||||||||||||||||
2012 | 2013 | ||||||||||||||||||||||||
US$ | US$ | ||||||||||||||||||||||||
ASSETS | |||||||||||||||||||||||||
Current assets | |||||||||||||||||||||||||
Cash and cash equivalents | 11,998 | 2,333 | |||||||||||||||||||||||
Prepayment and other current assets | 293 | 278 | |||||||||||||||||||||||
Amount due from subsidiaries | 8,904 | 2,642 | |||||||||||||||||||||||
Total current assets | 21,195 | 5,253 | |||||||||||||||||||||||
Non-current assets | |||||||||||||||||||||||||
Investment in subsidiaries | 45,836 | 62,424 | |||||||||||||||||||||||
Total non-current assets | 45,836 | 62,424 | |||||||||||||||||||||||
Total assets | 67,031 | 67,677 | |||||||||||||||||||||||
LIABILITIES AND EQUITY | |||||||||||||||||||||||||
Current liabilities | |||||||||||||||||||||||||
Accrued expenses and other liabilities | 159 | 809 | |||||||||||||||||||||||
Amount due to subsidiaries | 2,255 | 2,348 | |||||||||||||||||||||||
Total current liabilities | 2,414 | 3,157 | |||||||||||||||||||||||
Total liabilities | 2,414 | 3,157 | |||||||||||||||||||||||
Shareholders’ equity | |||||||||||||||||||||||||
Ordinary shares (par value of US$0.0001 per share at September 30, 2012 and 2013; Authorized - 480,000,000 shares at September 30, 2012 and 2013; Issued and outstanding – 134,386,849 and 135,532,141 shares at September 30, 2012 and 2013, respectively) | 13 | 14 | |||||||||||||||||||||||
Additional paid-in capital | 61,777 | 46,742 | |||||||||||||||||||||||
Accumulated other comprehensive income | 4,922 | 6,295 | |||||||||||||||||||||||
Retained earnings/(Cumulative deficits) | (2,095 | ) | 11,469 | ||||||||||||||||||||||
Total equity | 64,617 | 64,520 | |||||||||||||||||||||||
Total liabilities and equity | 67,031 | 67,677 | |||||||||||||||||||||||
CHINA DISTANCE EDUCATION HOLDINGS LIMITED | |||||||||||||||||||||||||
Additional Information - Financial Statement Schedule I | |||||||||||||||||||||||||
Condensed Financial Information of Parent Company | |||||||||||||||||||||||||
STATEMENTS OF OPERATIONS | |||||||||||||||||||||||||
(U.S. dollars in thousands, except share data and per share data, or otherwise noted) | |||||||||||||||||||||||||
For the years ended September 30, | |||||||||||||||||||||||||
2011 | 2012 | 2013 | |||||||||||||||||||||||
US$ | US$ | US$ | |||||||||||||||||||||||
Cost of revenues | (1,999 | ) | (37 | ) | (56 | ) | |||||||||||||||||||
Selling expenses | (678 | ) | (16 | ) | (47 | ) | |||||||||||||||||||
General and administrative expenses | (4,209 | ) | (1,033 | ) | (1,556 | ) | |||||||||||||||||||
Operating loss | (6,886 | ) | (1,086 | ) | (1,659 | ) | |||||||||||||||||||
Equity in income of subsidiaries and variable interest entities | 2,819 | 9,124 | 15,215 | ||||||||||||||||||||||
Finance cost | 265 | 171 | 8 | ||||||||||||||||||||||
Net (loss)/income | (3,802 | ) | 8,209 | 13,564 | |||||||||||||||||||||
CHINA DISTANCE EDUCATION HOLDINGS LIMITED | |||||||||||||||||||||||||
Additional Information - Financial Statement Schedule I | |||||||||||||||||||||||||
Condensed Financial Information of Parent Company | |||||||||||||||||||||||||
STATEMENTS OF COMPREHENSIVE INCOME (LOSS) | |||||||||||||||||||||||||
(U.S. dollars in thousands, except share data and per share data, or otherwise noted) | |||||||||||||||||||||||||
Years ended September 30, | |||||||||||||||||||||||||
2011 | 2012 | 2013 | |||||||||||||||||||||||
US$ | US$ | US$ | |||||||||||||||||||||||
Net (loss)/income | (3,802 | ) | 8,209 | 13,564 | |||||||||||||||||||||
Other comprehensive income (loss): | |||||||||||||||||||||||||
Foreign currency translation adjustment | 1,822 | 701 | 1,373 | ||||||||||||||||||||||
Total comprehensive income | 1,980 | 8,910 | 14,937 | ||||||||||||||||||||||
CHINA DISTANCE EDUCATION HOLDINGS LIMITED | |||||||||||||||||||||||||
Additional Information - Financial Statement Schedule I | |||||||||||||||||||||||||
Condensed Financial Information of Parent Company | |||||||||||||||||||||||||
STATEMENT OF CHANGES IN EQUITY | |||||||||||||||||||||||||
(U.S. dollars in thousands, except share data and per share data, or otherwise noted) | |||||||||||||||||||||||||
China Distance Education Holding Limited shareholders | |||||||||||||||||||||||||
Total China | |||||||||||||||||||||||||
Accumulated | Retained | Distance Education | |||||||||||||||||||||||
Number of | Additional | other | earnings/ | Holding Limited | |||||||||||||||||||||
ordinary | Ordinary | paid-in | comprehensive | (Cumulative | shareholders’ | ||||||||||||||||||||
shares | shares | capital | income | deficits) | equity | ||||||||||||||||||||
US$ | US$ | US$ | US$ | US$ | |||||||||||||||||||||
Balance as of September 30, 2010 | 136,932,849 | 14 | 79,075 | 2,399 | (6,502 | ) | 74,986 | ||||||||||||||||||
Net loss for the year | — | — | — | — | (3,802 | ) | (3,802 | ) | |||||||||||||||||
Foreign currency translation adjustments | — | — | — | 1,822 | — | 1,822 | |||||||||||||||||||
Repurchase of ordinary shares | (9,223,188 | ) | (1 | ) | (8,137 | ) | — | — | (8,138 | ) | |||||||||||||||
Options exercised | 91,012 | — | 75 | — | — | 75 | |||||||||||||||||||
Stock-based compensation expense - stock options (Note 23) | — | — | 6,024 | — | — | 6,024 | |||||||||||||||||||
Acquisition of noncontrolling Interest of Gaokao retake business (Note 3) | — | — | 911 | — | — | 911 | |||||||||||||||||||
Acquisition of noncontrolling Interest of start-up training business (Note 3) | — | — | 856 | — | — | 856 | |||||||||||||||||||
Balance as of September 30, 2011 | 127,800,673 | 13 | 78,804 | 4,221 | (10,304 | ) | 72,734 | ||||||||||||||||||
Net income for the year | — | — | — | — | 8,209 | 8,209 | |||||||||||||||||||
Foreign currency translation adjustments | — | — | — | 701 | — | 701 | |||||||||||||||||||
Repurchase of ordinary shares | (1,285,464 | ) | — | (993 | ) | — | — | (993 | ) | ||||||||||||||||
Options exercised | 7,871,640 | — | 3,981 | — | — | 3,981 | |||||||||||||||||||
Stock-based compensation expense - stock options (Note 23) | — | — | 141 | — | — | 141 | |||||||||||||||||||
Dividends (Note 24) | — | — | (16,268 | ) | — | — | (16,268 | ) | |||||||||||||||||
Loan to optionees in connection with exercise of options | — | — | (3,888 | ) | — | — | (3,888 | ) | |||||||||||||||||
Balance as of September 30, 2012 | 134,386,849 | 13 | 61,777 | 4,922 | (2,095 | ) | 64,617 | ||||||||||||||||||
Net income for the year | — | — | — | — | 13,564 | 13,564 | |||||||||||||||||||
Foreign currency translation adjustments | — | — | — | 1,373 | — | 1,373 | |||||||||||||||||||
Repurchase of ordinary shares | (67,100 | ) | — | (93 | ) | — | — | (93 | ) | ||||||||||||||||
Options exercised | 987,392 | 1 | 602 | — | — | 603 | |||||||||||||||||||
Stock-based compensation expense (Note 23) | 225,000 | — | 625 | — | — | 625 | |||||||||||||||||||
Dividends (Note 24) | — | — | (16,056 | ) | — | — | (16,056 | ) | |||||||||||||||||
Loan to optionees in connection with exercise of options | — | — | (113 | ) | — | — | (113 | ) | |||||||||||||||||
Balance as of September 30, 2013 | 135,532,141 | 14 | 46,472 | 6,295 | 11,469 | 64,520 | |||||||||||||||||||
CHINA DISTANCE EDUCATION HOLDINGS LIMITED | |||||||||||||||||||||||||
Additional Information - Financial Statement Schedule I | |||||||||||||||||||||||||
Condensed Financial Information of Parent Company | |||||||||||||||||||||||||
STATEMENTS OF CASH FLOWS | |||||||||||||||||||||||||
(U.S. dollars in thousands, except share data and per share data, or otherwise noted) | |||||||||||||||||||||||||
For the years ended September 30, | |||||||||||||||||||||||||
2011 | 2012 | 2013 | |||||||||||||||||||||||
US$ | US$ | US$ | |||||||||||||||||||||||
CASH FLOWS FROM OPERATING ACTIVITIES | |||||||||||||||||||||||||
Net (loss) income | (3,802 | ) | 8,209 | 13,564 | |||||||||||||||||||||
Adjustments to reconcile net income to net cash used in operating activities: | |||||||||||||||||||||||||
Equity in profit of subsidiaries and variable interest entities | (2,819 | ) | (9,124 | ) | (15,215 | ) | |||||||||||||||||||
Share-based compensation | 6,024 | 141 | 625 | ||||||||||||||||||||||
Increase in accrued expenses and other liabilities | 47 | 22 | 650 | ||||||||||||||||||||||
Decrease in amounts due from subsidiaries | 4,033 | 10,318 | 6,262 | ||||||||||||||||||||||
Increase (decrease) in prepayments and other assets | 56 | (36 | ) | 15 | |||||||||||||||||||||
Increase in amounts due to a subsidiary | 3 | 16 | 93 | ||||||||||||||||||||||
Net cash generated in operating activities | 3,542 | 9,546 | 5,994 | ||||||||||||||||||||||
Repurchase of ordinary shares | (8,138 | ) | (993 | ) | (93 | ) | |||||||||||||||||||
Proceeds from share options exercised by employees | 75 | 3,981 | 603 | ||||||||||||||||||||||
Loan to optionees in connection with exercise of options | — | (3,888 | ) | (408 | ) | ||||||||||||||||||||
Repayment of loan to optionees in connection with exercise of options | — | — | 295 | ||||||||||||||||||||||
Dividends paid to shareholders | — | (16,268 | ) | (16,056 | ) | ||||||||||||||||||||
Net cash used in financing activities | (8,063 | ) | (17,168 | ) | (15,659 | ) | |||||||||||||||||||
Net decrease in cash and cash equivalents | (4,521 | ) | (7,622 | ) | (9,665 | ) | |||||||||||||||||||
Cash and cash equivalents at beginning of the year | 24,141 | 19,620 | 11,998 | ||||||||||||||||||||||
Cash and cash equivalents and end of the year | 19,620 | 11,998 | 2,333 | ||||||||||||||||||||||
CHINA DISTANCE EDUCATION HOLDINGS LIMITED | |||||||||||||||||||||||||
Additional Information - Financial Statement Schedule I | |||||||||||||||||||||||||
Condensed Financial Information of Parent Company | |||||||||||||||||||||||||
NOTES TO FINANCIAL STATEMENTS | |||||||||||||||||||||||||
(U.S. dollars in thousands, except share data and per share data, or otherwise noted) | |||||||||||||||||||||||||
1 | BASIS FOR PREPARATION | ||||||||||||||||||||||||
The condensed financial information of the Parent Company has been prepared using the same accounting policies as set out in the Group’s consolidated financial statements except that the Parent Company used the equity method to account for investments in its subsidiaries and VIE. | |||||||||||||||||||||||||
The condensed financial information is provided since the restricted net assets of the Group’s subsidiaries, VIE and VIE’s subsidiaries were over the 25% of the consolidated net assets of the Group as of September 30, 2013. | |||||||||||||||||||||||||
2 | INVESTMENTS IN SUBSIDIARIES AND VIE | ||||||||||||||||||||||||
In its consolidated financial statements, the Parent Company consolidates the results of operations and assets and liabilities of its subsidiaries, VIE and VIE’s subsidiaries, and inter-company balances and transactions were eliminated upon consolidation. For the purpose of the Parent Company’s standalone financial statements, its investments in subsidiaries are reported using the equity method of accounting as a single line item and the Parent Company’s share of income from its subsidiaries are reported as the single line item of equity in income of subsidiaries and variable interest entities. | |||||||||||||||||||||||||
The Parent Company carried the investments in subsidiaries and VIE at $45,836 and $62,424 at September 30, 2012 and 2013, respectively. | |||||||||||||||||||||||||
The Parent Company’s share of equity in income in subsidiaries and the VIE recognized in years ended September 30, 2011, 2012 and 2013 was $2,819, $9,124 and $15,215, respectively. |
SIGNIFICANT_ACCOUNTING_POLICIE1
SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended | ||||
Sep. 30, 2013 | |||||
Basis of presentation and use of estimates | ' | ||||
Basis of presentation and use of estimates | |||||
The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). | |||||
The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities at the balance sheet dates and the reported amounts of revenues and expenses during the reporting periods. Significant estimates and assumptions reflected in the Group’s financial statements include, but are not limited to, revenue recognition, consolidation of VIE, income tax, allowance for doubtful accounts, impairment of goodwill and long-term assets and share-based compensation expenses. Actual results could materially differ from those estimates. | |||||
The effect of discontinued operations has been reflected in certain accounts and balances in the consolidated financial statements for the year ended September 30, 2010 as described in Note 4. | |||||
Principles of consolidation | ' | ||||
Principles of consolidation | |||||
The consolidated financial statements include the financial statements of the Company, its subsidiaries, its VIE and VIE’s subsidiaries. All transactions and balances among the Company, its subsidiaries, its VIE and VIE’s subsidiaries have been eliminated upon consolidation. | |||||
Foreign currency translation and transactions | ' | ||||
Foreign currency translation and transactions | |||||
The Company, DL Education CDEL Hong Kong and Pencil’s functional currencies are United States dollars (“US$”). The Company’s PRC subsidiaries, VIE and VIE’s subsidiaries determine their functional currencies to be the Chinese Renminbi (“RMB”). The Company uses the US$ as its reporting currency and uses the monthly average exchange rate for the year and the exchange rate at the balance sheet date to translate the operating results and financial position of its PRC subsidiaries and its variable interest entities, respectively. Translation differences are recorded in accumulated other comprehensive income, a component of consolidated statements of changes in equity. | |||||
Transactions denominated in foreign currencies are remeasured into the functional currency at the exchange rates prevailing on the transaction dates. Foreign currency denominated financial assets and liabilities are remeasured at the balance sheet date exchange rate. Exchange gains and losses are included in the consolidated statements of comprehensive income (loss). | |||||
Cash and cash equivalents | ' | ||||
Cash and cash equivalents | |||||
Cash and cash equivalents consist of cash on hand and highly liquid investments which are unrestricted as to withdrawal or use, and which have an original maturity of three months or less when purchased. | |||||
Term deposits | ' | ||||
Term deposits | |||||
Term deposits consist of deposits placed with financial institutions with an original maturity of greater than three months and less than one year. | |||||
Inventories | ' | ||||
Inventories | |||||
Inventories, consisting of papers and professional examination reference books, are stated at the lower of cost or market value. Cost is determined using the first in, first out method. | |||||
Fair value | ' | ||||
Fair value | |||||
Fair value is 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 it considers assumptions that market participants would use when pricing the asset or liability. Authoritative literature provides a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. The level in the hierarchy within which the fair value measurement in its entirety falls is based upon the lowest level of input that is significant to the fair value measurement as follows: | |||||
Level 1 | |||||
Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities. | |||||
Level 2 | |||||
Level 2 applies to assets or liabilities for which there are inputs other than quoted prices included within Level 1 that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data. | |||||
Level 3 | |||||
Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities. | |||||
Allowance for doubtful accounts | ' | ||||
Allowance for doubtful accounts | |||||
An allowance for doubtful accounts is recorded in the period in which a loss is determined to be probable based on an assessment of specific evidence indicating doubtful collection, historical experience, account balance aging and prevailing economic conditions. Accounts receivable balances are written off after all collection efforts have been exhausted. | |||||
Property, plant and equipment, net | ' | ||||
Property, plant and equipment, net | |||||
Property, plant and equipment are stated at cost and are depreciated using the straight-line method over the estimated useful lives of the assets, as follows: | |||||
Category | Estimated useful life | Estimated residual value | |||
Buildings | 35 years | 5-10% | |||
Electronic and office equipment | 5 years | 5-10% | |||
Motor vehicles | 5 years | 5-10% | |||
Leasehold improvement and building improvement | Shorter of lease term or 5 years | — | |||
Repair and maintenance costs are charged to expense as incurred, whereas the cost of renewals and betterment that extends the useful lives of property, plant and equipment are capitalized as additions to the related assets. Retirements, sales and disposals of assets are recorded by removing the cost and accumulated depreciation from the asset and accumulated depreciation accounts with any resulting gain or loss reflected in the consolidated statements of operations. | |||||
Goodwill | ' | ||||
Goodwill | |||||
Goodwill is not amortized, but tested for impairment annually or more frequently if event and circumstances indicate that it might be impaired. | |||||
The excess of the purchase price over the fair value of net assets acquired is recorded on the consolidated balance sheet as goodwill. In September 2011, the FASB issued an authoritative pronouncement related to testing goodwill for impairment. The guidance permits the Company to first assess qualitative factors to determine whether it is “more likely than not” that the fair value of a reporting unit is less than its carrying amount as a basis for determining whether it is necessary to perform the two-step goodwill impairment test. Absent from any impairment indicators, the Group performs its annual impairment test on the last day of each fiscal year. | |||||
For the years ended September 30, 2012 and 2013, the Group did not choose to perform the assessment of qualitative factors for goodwill impairment and performed its annual impairment test using a two-step approach. The first step compares the fair value of a reporting unit to its carrying amount, including goodwill. If the fair value of the reporting unit is greater than its carrying amount, goodwill is not considered impaired and the second step is not required. If the fair value of the reporting unit is less than its carrying amount, the second step of the impairment test measures the amount of the impairment loss, if any, by comparing the implied fair value of goodwill to its carrying amount. If the carrying amount of goodwill exceeds its implied fair value, an impairment loss is recognized equal to that excess. The implied fair value of goodwill is calculated in the same manner that goodwill is calculated in a business combination, whereby the fair value of the reporting unit is allocated to all of the assets and liabilities of that unit, with the excess purchase price over the amounts assigned to assets and liabilities representing the implied fair value of goodwill. | |||||
Other intangible assets, net | ' | ||||
Other intangible assets, net | |||||
Other intangible assets are amortized using the straight-line basis over the estimated useful lives as follows: | |||||
Category | Estimated useful life | ||||
Computer software | 3~5 years | ||||
Domain names and trademarks | 10~11 years | ||||
Courseware | 1~5 years | ||||
Website | 5 years | ||||
Business contracts | 3~5 years | ||||
Copyrights | 5 years | ||||
Platform | 3.5 years | ||||
Impairment of long-lived assets | ' | ||||
Impairment of long-lived assets | |||||
The Group evaluates its long-lived assets or asset group including intangibles with definite lives for impairment whenever events or changes in circumstances (such as a significant adverse change to market conditions that will impact the future use of the assets) indicate that the carrying amount of a group of long-lived assets may not be fully recoverable. When these events occur, the Group evaluates the impairment by comparing the carrying amount of the assets to future undiscounted net cash flows expected to result from the use of the assets and their eventual disposition. If the sum of the expected undiscounted cash flows is less than the carrying amount of the assets, the Group recognizes an impairment loss based on the excess of the carrying amount of the asset group over its fair value, generally based upon discounted cash flows. | |||||
If the intent is to hold the asset for sale and certain other criteria are met (i.e., the asset can be disposed of currently, appropriate levels of authority have approved sale, and there is an actively pursuing buyer), the impairment test is a comparison of the asset’s carrying value to its fair value less costs to sell. To the extent that the carrying value is greater than the asset’s fair value less costs to sell, an impairment loss is recognized for the difference. Assets held for sale are separately presented on the balance sheet and are no longer depreciated. | |||||
Revenue recognition | ' | ||||
Revenue recognition | |||||
Revenues are recognized when the following four criteria are met: (i) persuasive evidence of an arrangement exists, (ii) the service has been rendered, (iii) the fees are fixed or determinable, and (iv) collectability is reasonably assured. | |||||
Online education services | |||||
The online education service provided by the Group to its customers is an integrated service, including audio-video course content, mock examinations and online chat rooms during the subscription period. Audio-video course content, mock examinations and online chat rooms are not practical to be sold on standalone basis and have never been sold separately. | |||||
The Group earns revenues by providing online education services to customers pursuant to two types of revenue models - non-refundable course model and refundable course model. | |||||
The online courses using the non-refundable course model are mainly comprised of regular classes and premium classes. The revenues for the regular classes are recognized on a straight line basis over the subscription period from the month in which the customers enroll in the courses to the month in which subscribed courses terminate. For premium classes, if participants fail to pass the course examination and certain pre-agreed conditions are met, the participants can retake the same premium course and pay only 50% of the course fees. As such, the 50% discount is proportionately applied as a deduction to revenue recognized for each of the two premium classes that participants are entitled to. | |||||
For online courses using the refundable course model (i.e. elite classes), if the participants complete the courses and fail the professional exams and their scores are within a range provided for in the agreement, they are entitled to either a full refund or the right to retake the course. The participants must notify the Group within a 15 -30 day period after the professional examinations scores are released in order to be eligible for the refund or the right to retake the course. The proceeds from the refundable course model are initially recorded as “refundable fees”. Revenues are recognized upon the expiration of the participants’ right to receive a refund or ratably over the course period if the participants decide to retake the course before the expiration of such right. | |||||
Most of the course participants pay course fees via online payment systems provided by third parties including internet debit or credit card payment systems and other third-party payment systems. Some participants may choose to enroll for online courses through the use of prepaid study cards which are purchased from distributors. The Group sells to its regional distributors prepaid study cards at a discount to the face value of the cards. Revenues are recorded using the after-discount-selling-price of the cards and recognized over the period the online course is available to the customer, which generally is from the enrollment date to the completion of the relevant professional examination date. Sales of prepaid study cards that are not activated for course enrollment are recognized as revenues upon expiration of the cards. Prepaid study cards that have been activated but have not been used to enroll online courses do not have an expiry date and will be deferred until they are used to enroll in online courses. Participants who enroll with the Company directly are eligible to a refund within a 7-day trial period. Revenues from direct enrollment with the Company are recognized over the period from the lapse of the 7-day trial period to the completion of the relevant professional examination date. | |||||
The Group may, at times, offer volume discounts to its regional distributors for purchases over a specified amount of prepaid cards during a specified period of time, generally, one year. The amount of future rebates relating to these volume discounts cannot be reasonably estimated and accordingly a deferred revenue balance is recognized for the maximum potential amount of volume discount. If the number of purchases specified in the volume discount provisions is not reached upon the expiry of the volume discount period, the deferred revenue relating to such volume discount for each study card is recognized as revenue over the remaining period the online course is available to the user who enrolls using the study card or recognized as revenue immediately if the related online course has been completed or the study card has expired. | |||||
The Group also provides student recruiting services and online platform to government agencies which use the Group’s online platform to conduct continuing education services. The Group earns service fees as a percentage of total tuition fees based on the agreements entered into with the government agencies. Service fees received are initially recorded as deferred revenue and are recognized as revenue when course participants complete the stipulated study hours and take the examinations, or on a straight line basis over the subscription period based on the terms of the agreements. | |||||
For the years ended September 30, 2011, 2012 and 2013, the Group recognized revenues before business tax and related surcharges in connection with expired study cards amounted to US$103, US$113 and US$164 respectively. | |||||
The online service is provided by Beijing Champion and its subsidiaries which are subject to approximately 3% business tax and related surcharges. The Group records revenues net of these taxes in the consolidated statements of operations. Such business tax and related surcharges for the years ended September 30, 2011, 2012 and 2013 were US$918, US$1,331 and US$1,986 respectively. | |||||
Books and reference materials | |||||
The Group sells books and reference materials to distributors and end users. Revenues relating to such sales are deferred until cash is collected. Inventory costs of products delivered to distributors for which revenues have been deferred are presented as “deferred costs” on the consolidated balance sheets. | |||||
The Group also sells books and reference materials together with study cards which allow the customers to take a certain number of on-line courses for no additional charge. These sales are considered arrangements with two deliverables, consisting of the delivery of books and reference material and the on-line courses service. Because neither vendor-specific objective evidence nor third-party evidence of fair value of the deliverables exist, the Group allocates revenue to each deliverables based on their relative selling price. | |||||
Other revenues | |||||
Other revenues include sales of offline education services, courseware production services, platform production services, and others. | |||||
Revenues from offline training are recognized when the training courses are provided. For offline training sponsored by government authorities, the tuition fees of the training participants are subsidized by the government. Qualified enrollments and the fees to be earned cannot be determined until the confirmation from government authorities regarding the number of students and fees is received by the Company, which is after the completion of services. Therefore, revenues from such services are recognized upon cash receipt or the receipt of confirmations from government authorities, whichever is earlier, when all the other revenue recognition criteria have been met. | |||||
Revenues from sales of courseware, which are designed and developed pursuant to the requests from customers, are recognized when the courseware or platforms are accepted by the customers. The Company has no significant remaining obligation with respect to the courseware or platforms upon the acceptance of the customers. | |||||
From time to time, the Group enters into arrangement to provide the development and maintenance of online platforms to its customers. After the development of online platforms, the Group provides support and maintenance services. The development of online platform and the support and maintenance services have never been sold separately and they do not have standalone value to the customers. Accordingly, revenues from such arrangement is accounted as a single unit of accounting and recognized ratably over the support and maintenance services period. | |||||
Revenues from other services, including magazine content production, advertising and consulting services, are recognized over the period when such services are provided. | |||||
Value added taxes | ' | ||||
Value added taxes | |||||
The Group is subject to PRC value added tax (“VAT”) generally at a rate of 13% on proceeds received from customers for sales related to books and reference materials, which reduces revenues, and are entitled to an offset for VAT paid for the books and reference materials as well as a portion of VAT paid related to purchase of fixed assets. | |||||
By virtue of the VAT pilot reform scheme in Beijing, effective as of September 1, 2012, Champion Technology and Champion Education Technology are subject to VAT, instead of business tax, for their technical and consulting service, software licensing and course production services provided. The applicable VAT rates are 6% and 3% for Champion Technology and Champion Education Technology, respectively. Champion Technology is a VAT general taxpayer and the output VAT liability of Champion Technology is allowed to offset qualified input VAT paid to suppliers. On the other hand, Champion Education Technology is a VAT small-scale taxpayer and its output VAT liability is not allowed to offset its input VAT. | |||||
Net VAT balance between input VAT and output VAT is recorded in either other current liabilities or other current assets on the consolidated balance sheets. | |||||
Cost of sales | ' | ||||
Cost of sales | |||||
Cost of online education services primarily includes the production costs of study cards, server and bandwidth leasing fees, lecturer fees, staff costs involved in the operation of online education services including network operation and maintenance, course production and tutor services and other direct costs of providing these services. These costs are expensed when incurred. | |||||
The cost of books and reference materials, including direct materials used for production of books, authorship fee and printing cost, are initially deferred and recorded as “deferred cost”. The deferred costs are recognized as cost of sales when the related revenue is recognized upon cash receipt. | |||||
Advertising expenditure | ' | ||||
Advertising expenditure | |||||
Advertising expenditure is expensed when incurred and are included in “selling expenses” in the consolidated statements of operations. Advertising expenses from continuing operations were US$2,204, US$2,112 and US$3,167, and those from discontinued operations were US$179, US$26 and US$nil, for the years ended September 30, 2011, 2012 and 2013, respectively. | |||||
Shipping and handling costs | ' | ||||
Shipping and handling costs | |||||
Shipping and handling costs of books and reference materials are classified as a component of “selling expenses” in the consolidated statements of operations. Shipping and handling costs classified as selling expenses from continuing operations were US$330, US$252 and US$489, and those from discontinued operations were US$8, US$1 and US$nil, for the years ended September 30, 2011, 2012 and 2013, respectively. | |||||
Income taxes | ' | ||||
Income taxes | |||||
Current income taxes are provided for in accordance with the laws of the relevant tax authorities. Deferred income taxes are recognized when temporary differences exist between the tax bases of assets and liabilities and their reported amounts in the financial statements. Net operating loss carry forwards and credits are applied using enacted statutory tax rates applicable to future years. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more-likely-than-not that a portion of or all of the deferred tax assets will not be realized. The components of the deferred tax assets and liabilities are individually classified as current and non-current based on their characteristics. The impact of an uncertain income tax position is recognized at the largest amount that is more-likely-than-not to be sustained upon audit by the relevant tax authority. An uncertain income tax position will not be recognized if it has less than a 50% likelihood of being sustained. Interest and penalties on income taxes will be classified as a component of the provisions for income taxes. | |||||
Share-based compensation | ' | ||||
Share-based compensation | |||||
Share-based compensation with employees is measured based on the grant-date fair value of the equity instrument issued and recognized as compensation expense over the requisite service period, with a corresponding addition to paid-in capital. The Group recognizes compensation expense over the vesting term on a straight-line basis with the amount of compensation expense recognized at any date not less than the portion of the grant-date value of the option vested at that date. | |||||
Share-based compensation with non-employee is measured based on the fair value of options at the earlier of the performance commitment date or the date at which the non-employee’s performance is complete (hereafter referred to as the measurement date). The Group recognizes compensation expense using the graded vesting attribution method. | |||||
Share-based compensation awards which require the issuance of a variable number of shares to settle a fixed monetary amount are accounted for as liabilities. | |||||
Net income per share | ' | ||||
Net income per share | |||||
Basic net income per share is computed by dividing income attributable to holders of ordinary shares by the weighted average number of ordinary shares outstanding during the period. Nonvested restricted shares are also participating securities as they enjoy identical dividend rights as ordinary shares. Accordingly, the Group uses the two-class method whereby undistributed net income is allocated on a pro rata basis to each participating share to the extent that each class may share in income for the period. Diluted net income per share reflects the potential dilution that could occur if securities or other contracts to issue ordinary shares were exercised or converted into ordinary shares. The dilutive effect of outstanding share-based awards is reflected in the diluted net income per share by application of the treasury stock method. | |||||
Business combinations | ' | ||||
Business combinations | |||||
Business combinations are recorded using the acquisition method of accounting. On October 1, 2009, the Group adopted a new accounting pronouncement with prospective application which made certain changes to the previous authoritative literature on business combinations. From October 1, 2009, the assets acquired, the liabilities assumed, and any noncontrolling interest of the acquiree at the acquisition date, if any, are measured at their fair values as of that date. Goodwill is recognized and measured as the excess of the total consideration transferred plus the fair value of any noncontrolling interest of the acquiree, if any, at the acquisition date over the fair values of the identifiable net assets acquired. Previously, any non-controlling interest was reflected at historical cost. Common forms of the consideration made in acquisitions include cash and common equity instruments. Consideration transferred in a business acquisition is measured at the fair value as at the date of acquisition. | |||||
Where the consideration in an acquisition includes contingent consideration the payment of which depends on the achievement of certain specified conditions post-acquisition, from October 1, 2009 the contingent consideration is recognized and measured at its fair value at the acquisition date and if recorded as a liability it is subsequently carried at fair value with changes in fair value reflected in earnings. For periods prior to October 1, 2009 contingent consideration was not recorded until the contingency was resolved. | |||||
In addition, upon the adoption of the accounting pronouncement regarding noncontrolling interests (see note 17), from October 1, 2009, changes in a parent’s ownership interest while the parent retains its controlling financial interest in its subsidiary are accounted for as equity transaction. Therefore, no gain or loss would be recognized and any difference between the fair value of the consideration received or paid and the amount by which the noncontrolling interest is adjusted is recognized in equity to the parent. | |||||
Comprehensive income (loss) | ' | ||||
Comprehensive income (loss) | |||||
Comprehensive income (loss) includes net income and foreign currency translation adjustments and is reported in the consolidated statements of comprehensive income. | |||||
Significant risks and uncertainties | ' | ||||
Significant risks and uncertainties | |||||
Foreign currency risk | |||||
RMB is not a freely convertible currency. The State Administration for Foreign Exchange, under the authority of the People’s Bank of China, controls the conversion of RMB into foreign currencies. The value of RMB is subject to changes in central government policies and to international economic and political developments affecting supply and demand in the China Foreign Exchange Trading System market. The cash and cash equivalents of the Group from the continuing operations and discontinued operations included aggregate amounts of US$36,360 and US$68,867, which were denominated in RMB, at September 30, 2012 and 2013, respectively, representing 73.1% and 95.8% of the cash and cash equivalents at September 30, 2012 and 2013, respectively. | |||||
Concentration of credit risk | |||||
Financial instrument that potentially expose the Group to significant concentration of credit risk primarily consist of cash and cash equivalents, term deposits, and accounts receivable. As of September 30, 2013, substantially all of the Group’s cash and cash equivalents and term deposits were deposited in financial institutions located in the PRC and Hong Kong. Accounts receivable are typically unsecured and are derived from revenue earned from customers in the PRC. The risk with respect to accounts receivable is mitigated by credit evaluations the Group performs on its customers and its ongoing monitoring process of outstanding balances. | |||||
There are no revenues from customers which individually represent greater than 10% of the total net revenues for any year of the three years period ended September 30, 2013. | |||||
Primarily due to the long payment cycles of government agencies, the Group had one customer that accounted for 43.7% of the Group’s accounts receivable balances as of September 30, 2012, respectively, and only one customer that accounted for 46.3% of the Group’s accounts receivable balances as of September 30, 2013. | |||||
Recently issued accounting pronouncements not yet adopted | ' | ||||
Recently issued accounting pronouncements not yet adopted | |||||
In March 2013, the FASB issued an authoritative pronouncement related to 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. When a reporting entity (parent) 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, the parent is required to release any related cumulative translation adjustment into net income. Accordingly, the cumulative translation adjustment should be released into net income only if the sale or transfer results in the complete or substantially complete liquidation of the foreign entity in which the subsidiary or group of assets had resided. | |||||
For an equity method investment that is a foreign entity, the partial sale guidance still applies. As such, a pro rata portion of the cumulative translation adjustment should be released into net income upon a partial sale of such an equity method investment. However, this treatment does not apply to an equity method investment that is not a foreign entity. In those instances, the cumulative translation adjustment is released into net income only if the partial sale represents a complete or substantially complete liquidation of the foreign entity that contains the equity method investment. | |||||
Additionally, the amendments in this pronouncement clarify that the sale of an investment in a foreign entity includes both: (1) events that result in the loss of a controlling financial interest in a foreign entity (i.e., irrespective of any retained investment); and (2) events that result in an acquirer obtaining control of an acquiree in which it held an equity interest immediately before the acquisition date (sometimes also referred to as a step acquisition). Accordingly, the cumulative translation adjustment should be released into net income upon the occurrence of those events. | |||||
The amendments in this pronouncement 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 Group does not expect the adoption of this guidance will have a material effect on its consolidated financial statements. | |||||
In July 2013, the FASB issued an Accounting Standard Update (“ASU”) which provides guidance on financial statement presentation of an unrecognized tax benefits when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. The FASB’s objective in issuing this ASU is to eliminate diversity in practice resulting from a lack of guidance on this topic in current U.S. GAAP. | |||||
The amendments in this ASU state 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 carryforward, a similar tax loss, or a tax credit carryforward, except as follows. | |||||
To the extent a net operating loss carryforward, a similar tax loss, or a 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 purpose, the unrecognized tax benefit should be presented in the financial statements as a liability and should not be combined with deferred tax assets. | |||||
This ASU applies to all entities that have unrecognized tax benefits when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists at the reporting date. The amendments in this ASU 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 Group does not expect the adoption of this guidance will have a material effect on its consolidated financial statements. |
ORGANIZATION_AND_BASIS_OF_PRES1
ORGANIZATION AND BASIS OF PRESENTATION (Tables) | 12 Months Ended | ||||||||||||
Sep. 30, 2013 | |||||||||||||
Details of Company's Subsidiaries and Variable Interest Entities | ' | ||||||||||||
As of September 30, 2013, details of the Company’s subsidiaries, its VIE and VIE’s subsidiaries were as follows: | |||||||||||||
Company | Date of | Place of | Percentage of | Principal activities | |||||||||
establishment | establishment | legal ownership | |||||||||||
by the Company | |||||||||||||
Subsidiaries: | |||||||||||||
China Distance Education Limited (“CDEL Hong Kong”) | March 13, 2003 | Hong Kong | 100 | % | Investment holding | ||||||||
Practice Enterprises Network China International Links Limited (“Pencil”) | February 23, 2010 | Hong Kong | 100 | % | Inactive | ||||||||
DL Education Service , LLC (“DL Education”) | September 27, 2012 | US | 100 | % | Inactive | ||||||||
Beijing Champion Distance Education Technology Co., Ltd. (“Champion Technology”) | 5-Jan-04 | PRC | 100 | % | Provision of technical support and consultancy services and course production | ||||||||
Beijing Champion Education Technology Co., Ltd. (“Champion Education Technology”) | 23-Apr-07 | PRC | 100 | % | Software licensing and course production | ||||||||
Variable interest entity: | |||||||||||||
Beijing Champion Hi-Tech Co., Ltd. (“Beijing Champion”) | 12-Jul-00 | PRC | Nil | Provision of online education services and sales of books and reference materials | |||||||||
Subsidiaries of variable interest entity: | |||||||||||||
Beijing Caikaowang Company Ltd. (“Caikaowang”) | November 28, 2007 | PRC | Nil | Provision of online education services | |||||||||
Beijing Champion Wangge Education Technology Co., Ltd. (“Champion Wangge”) | 24-Jun-08 | PRC | Nil | Provision of online education services | |||||||||
Beijing Zhengbao Yucai Education Technology Co., Ltd. (“Zhengbao Yucai”) | 19-Feb-09 | PRC | Nil | Provision of start-up training services | |||||||||
Beijing Haidian District Champion Training School (“Champion Training School”) | 19-Feb-09 | PRC | Nil | Provision of online and offline education services | |||||||||
Financial Information of Company's VIE and VIE's Subsidiaries | ' | ||||||||||||
The following financial information of the Company’s VIE and VIE’s subsidiaries as of September 30, 2012 and 2013 and for each of the three years in the period ended September 30, 2013 was included in the accompanying consolidated financial statements after elimination of intercompany transactions and balances within VIE and VIE’s subsidiaries: | |||||||||||||
As of September 30, | |||||||||||||
2012 | 2013 | ||||||||||||
US$ | US$ | ||||||||||||
Cash and cash equivalents | 15,798 | 39,706 | |||||||||||
Prepayment and other current assets | 3,311 | 3,839 | |||||||||||
Total current assets | 29,581 | 54,575 | |||||||||||
Total assets | 47,381 | 72,515 | |||||||||||
Deferred revenue | 9,408 | 17,120 | |||||||||||
Total current liabilities | 24,041 | 38,442 | |||||||||||
Total liabilities | 24,041 | 38,442 | |||||||||||
Total equity | 23,340 | 34,073 | |||||||||||
For the years ended September 30, | |||||||||||||
2011 | 2012 | 2013 | |||||||||||
US$ | US$ | US$ | |||||||||||
Revenues | 42,510 | 52,005 | 70,942 | ||||||||||
Net income (1) | 7,365 | 14,944 | 21,062 | ||||||||||
Net cash provided by operating activities | 2,860 | 6,958 | 25,755 | ||||||||||
Net cash (used in)/provided by investing activities | (2,137 | ) | 549 | (2,521 | ) | ||||||||
Effects of exchange rate changes | 481 | 183 | 674 | ||||||||||
-1 | This is net income before service fees charged by Champion Technology and Champion Education Technology. |
SIGNIFICANT_ACCOUNTING_POLICIE2
SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended | ||||
Sep. 30, 2013 | |||||
Schedule of Estmated Useful Lives of Property, Plant and Equipment | ' | ||||
Property, plant and equipment are stated at cost and are depreciated using the straight-line method over the estimated useful lives of the assets, as follows: | |||||
Category | Estimated useful life | Estimated residual value | |||
Buildings | 35 years | 5-10% | |||
Electronic and office equipment | 5 years | 5-10% | |||
Motor vehicles | 5 years | 5-10% | |||
Leasehold improvement and building improvement | Shorter of lease term or 5 years | — | |||
Schedule Of Estmated Useful Lives Of Other Intangible Assets | ' | ||||
Other intangible assets are amortized using the straight-line basis over the estimated useful lives as follows: | |||||
Category | Estimated useful life | ||||
Computer software | 3~5 years | ||||
Domain names and trademarks | 10~11 years | ||||
Courseware | 1~5 years | ||||
Website | 5 years | ||||
Business contracts | 3~5 years | ||||
Copyrights | 5 years | ||||
Platform | 3.5 years |
TRANSACTIONS_IN_CONNECTION_WIT1
TRANSACTIONS IN CONNECTION WITH ACQUIRED BUSINESS (Tables) | 12 Months Ended | ||||||
Sep. 30, 2013 | |||||||
Beijing Zhengbao Yucai Education Technology Co Ltd (Zhengbao Yucai) | ' | ||||||
Allocation of Purchase Price to Fair Values of Portion of Assets Acquired and Liabilities Assumed | ' | ||||||
The following table presents the allocation of the purchase price to the fair values of the portion of the assets acquired and liabilities assumed on September 30, 2009, which were determined by the Group with the assistance of an independent valuation firm. | |||||||
US$ | Amortization | ||||||
period | |||||||
Accounts receivable | 1,968 | ||||||
Purchased call option | 669 | ||||||
Other intangible assets: | |||||||
Non-compete agreement | 650 | 15 years | |||||
Supplementary domain names | 1 | 10 years | |||||
Deferred revenue | (1,617 | ) | |||||
Deferred tax liability | (330 | ) | |||||
Income tax payable | (61 | ) | |||||
Other payables | (107 | ) | |||||
Noncontrolling interest | (937 | ) | |||||
Goodwill | 2,143 | ||||||
Total consideration | 2,379 | ||||||
Zhejiang Champion Xinlixiang Education Management Co Ltd (Champion Xinlixiang) | ' | ||||||
Allocation of Purchase Price to Fair Values of Portion of Assets Acquired and Liabilities Assumed | ' | ||||||
The following table presents the allocation of the purchase price to the fair values of the portion of the assets acquired and liabilities assumed on March 10, 2009, which were determined by the Group with the assistance of an independent valuation firm. | |||||||
US$ | Amortization | ||||||
period | |||||||
Cash | 2,854 | ||||||
Property, plant and equipment | 138 | ||||||
Purchased call options | 1,221 | ||||||
Other intangible assets: | |||||||
Business contracts | 476 | 3~5 years | |||||
Copyrights | 586 | 5 years | |||||
Platform | 195 | 3.5 years | |||||
Domain names | 168 | 10~11 years | |||||
Software | 311 | 3 years | |||||
Courseware | 255 | 5 years | |||||
Deferred tax liability | (382 | ) | |||||
Noncontrolling interest | (2,107 | ) | |||||
Goodwill | 1,603 | ||||||
Total consideration | 5,318 | ||||||
DISCONTINUED_OPERATIONS_Tables
DISCONTINUED OPERATIONS (Tables) | 12 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Assets And Liabilities of Discontinued Operations | ' | ||||||||
The following is a summary of the assets and liabilities sold as of May 4, 2012 and the related gain on disposal: | |||||||||
Disposed as of | |||||||||
May 4, | |||||||||
2012 | |||||||||
US$ | |||||||||
Current assets of discontinued operations: | |||||||||
Cash and cash equivalents | 312 | ||||||||
Accounts receivable, net | 14 | ||||||||
Prepayment and other current assets | 324 | ||||||||
650 | |||||||||
Current liabilities of discontinued operations: | |||||||||
Accrued expenses and other liabilities | 348 | ||||||||
Income tax payable | 128 | ||||||||
Deferred revenue, current portion | 314 | ||||||||
790 | |||||||||
Net liabilities disposed | (140 | ) | |||||||
Cash proceeds | 157 | ||||||||
Gain on disposition of the discontinued operation | 297 | ||||||||
Operating Results From Discontinued Operations | ' | ||||||||
Summarized operating results from the discontinued operations included in the Group’s consolidated statements of operations were as follows for the years ended September 30, 2011 and 2012: | |||||||||
Years ended September 30, | |||||||||
2011 | 2012 | ||||||||
US$ | US$ | ||||||||
Revenues | 1,776 | 1,045 | |||||||
Pre-tax profit (loss) from discontinued operations | (3,444 | ) | (61 | ) | |||||
Income tax expense | 144 | — | |||||||
Income (loss) from discontinued operations, net of tax | (3,300 | ) | (61 | ) | |||||
Gain on disposal of discontinued operation | — | 297 | |||||||
Net (loss) income from discontinued operations attributable to China Distance Education Holding Limited, net of tax | (3,300 | ) | 236 | ||||||
ACCOUNTS_RECEIVABLE_NET_Tables
ACCOUNTS RECEIVABLE, NET (Tables) | 12 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Accounts Receivable, Net | ' | ||||||||
Accounts receivable, net consisted of the following: | |||||||||
As of September 30, | |||||||||
2012 | 2013 | ||||||||
US$ | US$ | ||||||||
Accounts receivable | 6,173 | 5,291 | |||||||
Less: allowance for doubtful accounts | (2,092 | ) | (1,773 | ) | |||||
Accounts receivable, net | 4,081 | 3,518 | |||||||
Movement Of Allowance For Doubtful Accounts | ' | ||||||||
Movement of allowance for doubtful accounts was as follows: | |||||||||
As of September 30, | |||||||||
2012 | 2013 | ||||||||
US$ | US$ | ||||||||
Balance at beginning of year | 3,190 | 2,092 | |||||||
Charged to expenses | 211 | (371 | ) | ||||||
Write-off of accounts receivable | (1,361 | ) | — | ||||||
Foreign currency adjustment | 52 | 52 | |||||||
Balance at end of the year | 2,092 | 1,773 | |||||||
INVENTORIES_NET_Tables
INVENTORIES, NET (Tables) | 12 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Inventories | ' | ||||||||
Inventories consisted of the following: | |||||||||
As of September 30, | |||||||||
2012 | 2013 | ||||||||
US$ | US$ | ||||||||
Books and other goods | 632 | 708 | |||||||
Paper and other raw materials | 70 | 102 | |||||||
Less: inventory provisions for slow-moving and obsolescence | (44 | ) | (112 | ) | |||||
658 | 698 | ||||||||
PREPAYMENT_AND_OTHER_CURRENT_A1
PREPAYMENT AND OTHER CURRENT ASSETS (Tables) | 12 Months Ended | ||||||||||||
Sep. 30, 2013 | |||||||||||||
Prepayment And Other Current Assets | ' | ||||||||||||
Prepayment and other current assets consisted of the following: | |||||||||||||
As of September 30, | |||||||||||||
Notes | 2012 | 2013 | |||||||||||
US$ | US$ | ||||||||||||
Advance to the suppliers | (1) | 1,835 | 1,873 | ||||||||||
Prepaid expenses | 1,092 | 1,034 | |||||||||||
Refundable prepayments | (2) | 325 | — | ||||||||||
Current portion of receivables related to ITAT program (Note 13) | — | 285 | |||||||||||
Funds receivable | (3) | 142 | 285 | ||||||||||
Deposits | 68 | 11 | |||||||||||
Others | 436 | 599 | |||||||||||
Less: allowance for doubtful accounts | (2) | (325 | ) | — | |||||||||
Prepayment and other current assets, net | 3,573 | 4,087 | |||||||||||
-1 | Advance to the suppliers represents interest-free cash deposits paid to suppliers for future purchase of raw materials and finished goods. The risk of loss arising from non-performance by or bankruptcy of the suppliers is assessed prior to making the deposits and is monitored on a regular basis by management. A charge to cost of sales will be recorded in the period in which a loss is incurred. To date, the Group has not experienced any loss of advances to suppliers. | ||||||||||||
-2 | The group prepaid a refundable fee to a government agency in the year ended September 30, 2010 as a sponsor of ITAT contest which was subsequently cancelled. In 2013, the Group and the government agency agreed to cease a series of cooperations on ITAT program, including ITAT contest. Based on the termination agreement, the Group waived the amount of US$325 related to the sponsorship of ITAT contest and accordingly wrote off the refundable prepayments in 2013. The Group recorded a full allowance for such prepaid amount in 2012. | ||||||||||||
-3 | Funds receivable arise due to the time taken to clear customers’ payment transactions through external payment networks. When customers remit fees to the Group via external payment networks using their bank account or credit card, there is a clearing period before the cash is received by the Group which usually takes one to three business days. These fees are treated as a receivable until the cash is received. |
PROPERTY_PLANT_AND_EQUIPMENT_N1
PROPERTY, PLANT AND EQUIPMENT, NET (Tables) | 12 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Property, Plant And Equipment | ' | ||||||||
Property, plant and equipment consisted of the following: | |||||||||
As of September 30, | |||||||||
2012 | 2013 | ||||||||
US$ | US$ | ||||||||
Buildings | 5,892 | 6,051 | |||||||
Electronic and office equipment | 7,604 | 9,523 | |||||||
Leasehold improvement and building improvement | 1,434 | 681 | |||||||
Motor vehicles | 1,106 | 1,164 | |||||||
Total | 16,036 | 17,419 | |||||||
Less: Accumulated depreciation | (6,360 | ) | (7,217 | ) | |||||
9,676 | 10,202 | ||||||||
GOODWILL_Tables
GOODWILL (Tables) | 12 Months Ended | ||||||||||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||||||||||
Goodwill | ' | ||||||||||||||||||||||||||||
Goodwill was comprised of the following: | |||||||||||||||||||||||||||||
Year ended September 30 | |||||||||||||||||||||||||||||
2012 | 2013 | ||||||||||||||||||||||||||||
Gaokao re-take | |||||||||||||||||||||||||||||
Online | Start-up | business - | Online | Start-up | |||||||||||||||||||||||||
education | training | discontinued | education | training | |||||||||||||||||||||||||
service | service | operations | Total | service | service | Total | |||||||||||||||||||||||
US$ | US$ | US$ | US$ | US$ | US$ | US$ | |||||||||||||||||||||||
Gross amount | |||||||||||||||||||||||||||||
Beginning balance | 5,642 | 1,761 | 2,262 | 9,665 | 5,726 | 1,785 | 7,511 | ||||||||||||||||||||||
Exchange difference | 84 | 24 | — | 108 | 154 | 46 | 200 | ||||||||||||||||||||||
Disposal | — | — | (2,262 | ) | (2,262 | ) | — | — | — | ||||||||||||||||||||
Ending balance | 5,726 | 1,785 | — | 7,511 | 5,880 | 1,831 | 7,711 | ||||||||||||||||||||||
Accumulated impairment loss | |||||||||||||||||||||||||||||
Beginning balance | — | — | (2,262 | ) | 2,262 | — | — | — | |||||||||||||||||||||
Charge for the year | — | — | — | — | — | — | — | ||||||||||||||||||||||
Exchange difference | — | — | — | — | — | — | — | ||||||||||||||||||||||
Disposal | — | — | (2,262 | ) | (2,262 | ) | — | — | — | ||||||||||||||||||||
Ending balance | — | — | — | — | — | — | — | ||||||||||||||||||||||
Goodwill, net | 5,726 | 1,785 | — | 7,511 | 5,880 | 1,831 | 7,711 | ||||||||||||||||||||||
OTHER_INTANGIBLE_ASSETS_NET_Ta
OTHER INTANGIBLE ASSETS, NET (Tables) | 12 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Composition Of Other Intangible Assets | ' | ||||||||
Other intangible assets consisted of the following: | |||||||||
As of September 30, | |||||||||
2012 | 2013 | ||||||||
US$ | US$ | ||||||||
Computer software | 2,645 | 2,978 | |||||||
Trademarks and domain names | 1,407 | 1,456 | |||||||
Website | 103 | 106 | |||||||
Courseware | 475 | 488 | |||||||
Business contracts | 517 | 531 | |||||||
Copyrights | 647 | 664 | |||||||
Platform | 211 | 217 | |||||||
Total intangible assets | 6,005 | 6,440 | |||||||
Less: Accumulated amortization | |||||||||
Computer software | (1,827 | ) | (2,275 | ) | |||||
Trademarks and domain names | (717 | ) | (840 | ) | |||||
Website | (102 | ) | (106 | ) | |||||
Courseware | (394 | ) | (462 | ) | |||||
Business contracts | (399 | ) | (494 | ) | |||||
Copyrights | (455 | ) | (600 | ) | |||||
Platform | (182 | ) | (187 | ) | |||||
Accumulated amortization | (4,076 | ) | (4,964 | ) | |||||
Intangible assets, net | 1,929 | 1,476 | |||||||
Estimated Amortization Expenses for Other Intangible Assets | ' | ||||||||
The estimated amortization expenses for the above other intangible assets for each of the following fiscal years are as follows | |||||||||
Amortization | |||||||||
US$ | |||||||||
2014 | 491 | ||||||||
2015 | 348 | ||||||||
2016 | 277 | ||||||||
2017 | 211 | ||||||||
2018 | 82 | ||||||||
2019 and thereafter | 67 | ||||||||
1,476 | |||||||||
DEPOSITS_FOR_PURCHASE_OF_NONCU1
DEPOSITS FOR PURCHASE OF NON-CURRENT ASSETS (Tables) | 12 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
DEPOSITS FOR PURCHASE OF NON-CURRENT ASSETS | ' | ||||||||
Deposits for purchase of non-current assets consisted of the following: | |||||||||
As of September 30, | |||||||||
2012 | 2013 | ||||||||
US$ | US$ | ||||||||
Deposit for purchase of property, plant and equipment | 131 | 374 | |||||||
131 | 374 | ||||||||
OTHER_NONCURRENT_ASSETS_Tables
OTHER NON-CURRENT ASSETS (Tables) | 12 Months Ended | ||||||||||
Sep. 30, 2013 | |||||||||||
Other Non-Current Assets | ' | ||||||||||
Other non-current assets consisted of the following: | |||||||||||
As of September 30, | |||||||||||
2012 | 2013 | ||||||||||
US$ | US$ | ||||||||||
Long-term prepaid expenses | -1 | 462 | 1,207 | ||||||||
Long-term receivables | -2 | 504 | 171 | ||||||||
Rental deposits | -3 | 125 | 168 | ||||||||
1,091 | 1,546 | ||||||||||
-1 | Long-term prepaid expenses represent golf club membership fee valid for a period of ten years. The amortization of the long term prepaid expenses was included in “general and administrative expenses” on the consolidated statements of operations. | ||||||||||
-2 | Long-term receivables represent the non-current portion of prepaid service fee for obtaining government authorization to provide the ITAT program, an information technique application training program, for ten years, starting from 2010. The group amortized such prepayment on a straight-line basis. In 2013, the Group ceased a series of cooperation on ITAT program. Based on the termination agreement signed in July 2013, the remaining unamortized prepaid service fee will be repaid within next 48 months. Accordingly, as of September 30, 2013, US$285 and US$171 were recorded as current portion and non-current portion of receivables due from the government agency respectively (see Note 7). | ||||||||||
-3 | Rental deposits represent office rental deposits for the Group’s daily operations. These deposits are classified as non-current deposits since they will not be refunded within one year. |
ACCRUED_EXPENSES_AND_OTHER_LIA1
ACCRUED EXPENSES AND OTHER LIABILITIES (Tables) | 12 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Accrued Expenses And Other Liabilities | ' | ||||||||
The components of accrued expenses and other liabilities are as follows: | |||||||||
As of September 30, | |||||||||
2012 | 2013 | ||||||||
US$ | US$ | ||||||||
Accrued expenses | 2,597 | 2,795 | |||||||
Salary and welfare payable | 1,823 | 2,775 | |||||||
Tuition fee payables to government agencies | 2,765 | 5,132 | |||||||
Remuneration payable to lecturers | 1,883 | 2,314 | |||||||
Uncertain income tax liabilities (Note 18) | 173 | 177 | |||||||
Payables to employees in connection with options exercise | — | 458 | |||||||
Other payable | 395 | 1,421 | |||||||
9,636 | 15,072 | ||||||||
NONCONTROLLING_INTERESTS_Table
NONCONTROLLING INTERESTS (Tables) | 12 Months Ended | ||||||||||||
Sep. 30, 2013 | |||||||||||||
Noncontrolling Interest | ' | ||||||||||||
The acquisition was accounted for as equity transaction with no gain or loss recognized. (See Note 3) | |||||||||||||
Start-up | Gaokao retake | ||||||||||||
training business | business | Total | |||||||||||
US$ | US$ | US$ | |||||||||||
Balance as of September 30, 2010 | 1,126 | 911 | 2,037 | ||||||||||
Net loss for the year | (303 | ) | — | (303 | ) | ||||||||
Foreign currency translation adjustments | 33 | — | 33 | ||||||||||
Acquisition of noncontrolling interest of start-up training business | (856 | ) | — | (856 | ) | ||||||||
Acquisition of noncontrolling interest of Gaokao retake business | — | (911 | ) | (911 | ) | ||||||||
Balance as of September 30, 2011 | — | — | — | ||||||||||
TAXATION_Tables
TAXATION (Tables) | 12 Months Ended | ||||||||||||
Sep. 30, 2013 | |||||||||||||
Income (Loss) Before Income Taxes From Continuing Operations | ' | ||||||||||||
Income before income taxes from continuing operations consisted of: | |||||||||||||
Years ended September 30, | |||||||||||||
2011 | 2012 | 2013 | |||||||||||
US$ | US$ | US$ | |||||||||||
Non - PRC | (6,873 | ) | (1,252 | ) | (2,003 | ) | |||||||
PRC | 7,039 | 11,825 | 19,364 | ||||||||||
166 | 10,573 | 17,361 | |||||||||||
Current and Deferred Components of Income Tax Benefit/ (Expense) from Continuing Operations | ' | ||||||||||||
The current and deferred components of the income tax benefit/(expense) from continuing operations appearing in the consolidated statements of operations are as follows: | |||||||||||||
Years ended September 30, | |||||||||||||
2011 | 2012 | 2013 | |||||||||||
US$ | US$ | US$ | |||||||||||
Current tax expense | 1,948 | 2,074 | 3,107 | ||||||||||
Deferred tax (benefit)/expense | (977 | ) | 526 | 690 | |||||||||
971 | 2,600 | 3,797 | |||||||||||
Reconciliation of Effective Tax Rate and Statutory Income Tax Rate Applicable to PRC Operations | ' | ||||||||||||
The reconciliation of the effective tax rate and the statutory income tax rate applicable to PRC operations is as follows: | |||||||||||||
Years ended September 30, | |||||||||||||
2011 | 2012 | 2013 | |||||||||||
US$ | US$ | US$ | |||||||||||
Income before taxes | 166 | 10,573 | 17,361 | ||||||||||
Income tax expense (benefit) computed a applicable tax rates of 25% | 42 | 2,643 | 4,340 | ||||||||||
Effect of different tax rates indifferent jurisdictions | 1,667 | 255 | 440 | ||||||||||
Non-deductible expenses | 260 | 59 | 75 | ||||||||||
Effect of tax holidays | (860 | ) | (1,037 | ) | (1,740 | ) | |||||||
Effect of valuation allowances | (138 | ) | 51 | 194 | |||||||||
Effect of tax rate changes | — | — | 237 | ||||||||||
Withholding tax on undistributed earnings | — | 629 | 251 | ||||||||||
971 | 2,600 | 3,797 | |||||||||||
Effective income tax rate | 584.94 | % | 24.59 | % | 21.87 | % | |||||||
Aggregate Amount and per Share Effect of Tax Holidays | ' | ||||||||||||
The aggregate amount and per share effect of the tax holidays are as follows: | |||||||||||||
Years ended September 30, | |||||||||||||
2011 | 2012 | 2013 | |||||||||||
US$ | US$ | US$ | |||||||||||
The aggregate amount of tax holidays | 860 | 1,037 | 1,740 | ||||||||||
The aggregate effect on basic and diluted net income per share: | |||||||||||||
- Basic | 0.01 | 0.01 | 0.01 | ||||||||||
- Diluted | 0.01 | 0.01 | 0.01 | ||||||||||
Components of Deferred Taxes from Continuing Operations | ' | ||||||||||||
The components of deferred taxes from continuing operations are as follows: | |||||||||||||
As of September 30, | |||||||||||||
2012 | 2013 | ||||||||||||
US$ | US$ | ||||||||||||
Current deferred tax assets | |||||||||||||
Payroll payable | 291 | 409 | |||||||||||
Accrued expenses | 524 | 585 | |||||||||||
Allowance for doubtful accounts | 592 | 518 | |||||||||||
Net operating loss carry-forwards | 449 | 289 | |||||||||||
Total current deferred tax assets | 1,856 | 1,801 | |||||||||||
Less: valuation allowance | — | (50 | ) | ||||||||||
Current deferred tax assets, net | 1,856 | 1,751 | |||||||||||
Non-current deferred tax assets | |||||||||||||
Intangible assets | 87 | 48 | |||||||||||
Property, plant and equipment | 146 | 148 | |||||||||||
Net operating loss carry-forwards | 522 | 372 | |||||||||||
Total non-current deferred tax assets | 755 | 568 | |||||||||||
Less: valuation allowance | (117 | ) | (262 | ) | |||||||||
Non-current deferred tax assets, net | 638 | 306 | |||||||||||
Non-current deferred tax liabilities | |||||||||||||
Intangible assets | 136 | 78 | |||||||||||
Withholding tax on undistributed earnings | 634 | 905 | |||||||||||
Total non-current deferred tax liabilities | 770 | 983 | |||||||||||
Reconciliation of Accrued Unrecognized Tax Benefits | ' | ||||||||||||
Reconciliation of accrued unrecognized tax benefits is as follows: | |||||||||||||
Unrecognized | |||||||||||||
tax benefits | |||||||||||||
Balance - September 30, 2011 | 170 | ||||||||||||
Foreign currency adjustment | 3 | ||||||||||||
Balance - September 30, 2012 | 173 | ||||||||||||
Foreign currency adjustment | 4 | ||||||||||||
Balance - September 30, 2013 | 177 | ||||||||||||
COMMITMENTS_AND_CONTINGENCIES_
COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended | ||||
Sep. 30, 2013 | |||||
Operating Lease Commitments | ' | ||||
Future minimum payments under non-cancelable operating leases related to offices, servers and bandwidth with initial terms of one-year or more consisted of the following at September 30, 2013: | |||||
US$ | |||||
Years ending September 30, | |||||
2014 | 1,637 | ||||
2015 | 80 | ||||
2016 | 58 | ||||
2017 | 5 | ||||
1,780 | |||||
SEGMENT_REPORTING_Tables
SEGMENT REPORTING (Tables) | 12 Months Ended | ||||||||||||
Sep. 30, 2013 | |||||||||||||
Revenues Attributable To The Different Service And Product Groups | ' | ||||||||||||
The revenues attributable to the different service and product groups are as follows: | |||||||||||||
Years ended September 30, | |||||||||||||
2011 | 2012 | 2013 | |||||||||||
US$ | US$ | US$ | |||||||||||
Online education services | 30,788 | 40,281 | 58,573 | ||||||||||
Books and reference materials | 4,743 | 4,438 | 5,129 | ||||||||||
Offline education services | 2,907 | 4,507 | 4,617 | ||||||||||
Others | 3,126 | 2,876 | 3,041 | ||||||||||
41,564 | 52,102 | 71,360 | |||||||||||
NET_LOSS_INCOME_PER_SHARE_Tabl
NET (LOSS) INCOME PER SHARE (Tables) | 12 Months Ended | ||||||||||||
Sep. 30, 2013 | |||||||||||||
Basic and diluted net (loss) income per share | ' | ||||||||||||
Basic and diluted net (loss) income per share for each of the periods presented were calculated as follows: | |||||||||||||
Years ended September 30, | |||||||||||||
2011 | 2012 | 2013 | |||||||||||
US$ | US$ | US$ | |||||||||||
Numerator: | |||||||||||||
Net income (loss) from continuing operations | (502 | ) | 7,973 | 13,564 | |||||||||
Net income (loss) from discontinued operations, net of tax | (3,300 | ) | 236 | — | |||||||||
Net (loss) income | (3,802 | ) | 8,209 | 13,564 | |||||||||
- allocated to ordinary share - basic | (3,800 | ) | 8,209 | 13,554 | |||||||||
- allocated to nonvested restricted share - basic | (2 | ) | — | 10 | |||||||||
Denominator: | |||||||||||||
Weighted average number of ordinary shares outstanding | 133,489,261 | 133,996,737 | 135,174,562 | ||||||||||
Weighted average number of nonvested restricted share | 82,466 | — | 103,082 | ||||||||||
Plus incremental weighted average ordinary shares from assumed exercise of share options using the treasury stock method | — | 366,371 | 1,121,589 | ||||||||||
Weighted average ordinary shares outstanding used in computing diluted net income per share | 133,571,727 | 134,363,108 | 136,399,233 | ||||||||||
Basic net (loss) income per share | |||||||||||||
Basic from continuing operations | — | 0.06 | 0.1 | ||||||||||
Basic from discontinued operations (net of tax) | (0.03 | ) | — | — | |||||||||
Basic | (0.03 | ) | 0.06 | 0.1 | |||||||||
Basic net (loss) income per nonvested restricted share | |||||||||||||
Basic from continuing operations | — | — | 0.1 | ||||||||||
Basic from discontinued operations (net of tax) | (0.03 | ) | — | — | |||||||||
Basic | (0.03 | ) | — | 0.1 | |||||||||
Diluted net (loss) income per share | |||||||||||||
Diluted from continuing operations | — | 0.06 | 0.1 | ||||||||||
Diluted from discontinued operations (net of tax) | (0.03 | ) | — | — | |||||||||
Diluted | (0.03 | ) | 0.06 | 0.1 | |||||||||
SHARE_INCENTIVE_PLAN_Tables
SHARE INCENTIVE PLAN (Tables) | 12 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Summary of Option Activity | ' | ||||||||||||||||
A summary of option activity as of September 30, 2013, and changes during the years ended September 30, 2013 are presented below: | |||||||||||||||||
Share option granted to employees and non-executive directors | Number | Weighted- | Weighted- | Aggregated | |||||||||||||
of shares | average | average | intrinsic value | ||||||||||||||
exercise price | remaining | ||||||||||||||||
contractual | |||||||||||||||||
term (years) | |||||||||||||||||
Outstanding, September 30, 2012 | 3,747,024 | US$ | 0.87 | 1 | 7 | — | |||||||||||
Exercised | 964,092 | US$ | 0.61 | ||||||||||||||
Forfeited | 82,300 | US$ | 1.41 | ||||||||||||||
Cancelled | 1,120,900 | US$ | 1.38 | ||||||||||||||
Outstanding, September 30, 2013 | 1,579,732 | US$ | 0.5 | 6.37 | 3,389 | ||||||||||||
Expected to vest, September 30, 2013 | — | — | — | — | |||||||||||||
Exercisable at September 30, 2013 | 1,579,732 | US$ | 0.5 | 6.37 | 3,389 | ||||||||||||
Share Options, NonEmployees | ' | ||||||||||||||||
A summary of the activities of the share option granted to non-employees as of September 30, 2013, and changes during the year ended September 30, 2013 are presented below: | |||||||||||||||||
Share option granted to non-employees | Number | Weighted- | Weighted- | Aggregated | |||||||||||||
of shares | average | average | intrinsic | ||||||||||||||
exercise price | remaining | value | |||||||||||||||
contractual | |||||||||||||||||
term (years) | |||||||||||||||||
Outstanding, September 30, 2012 | 151,500 | US$ | 0.62 | 1 | 5.55 | 25 | |||||||||||
Exercised | 23,300 | US$ | 0.495 | ||||||||||||||
Outstanding, September 30, 2013 | 128,200 | US$ | 0.495 | 4.55 | 275 | ||||||||||||
Expected to vest, September 30, 2013 | — | — | — | — | |||||||||||||
Exercisable at September 30, 2013 | 128,200 | US$ | 0.495 | 4.55 | 275 | ||||||||||||
1 | On November 13, 2012, the Company approved and declared a cash dividend of US$0.12 per ordinary share on its outstanding shares to shareholders as of December 7, 2012 and according to the terms of the Prior and New Plan, reduced the exercise price by US$0.12 for all of the outstanding options as of December 7, 2012. The change in exercise price was incurred in the year ended September 30, 2013, and therefore was not reflected in the weighted-average exercise price as of September 30, 2012. | ||||||||||||||||
Estimated Fair Value of The Share Options, Assumptions Used | ' | ||||||||||||||||
The Company used the Black Scholes Model to estimate the fair value of the share options on the grant dates with the following assumptions: | |||||||||||||||||
For the year ended | |||||||||||||||||
September 30, | |||||||||||||||||
2011 | |||||||||||||||||
Risk-free interest rate | 1.40% ~ 1.86% | ||||||||||||||||
Dividend yield | — | ||||||||||||||||
Expected volatility | 51% | ||||||||||||||||
Expected life (in years) | 3.71 ~ 5.63 | ||||||||||||||||
Summary of The Nonvested Restricted Shares Activity | ' | ||||||||||||||||
A summary of the nonvested restricted shares activity is as follows: | |||||||||||||||||
Number of | Weight average | Aggregated | |||||||||||||||
Nonvested restricted | grant-date | intrinsic value | |||||||||||||||
shares outstanding | fair value | ||||||||||||||||
US$ | |||||||||||||||||
Nonvested restricted shares outstanding at September 30, 2012 | — | — | |||||||||||||||
Granted | 225,000 | 1.22 | |||||||||||||||
Vested | 100,000 | 1.22 | |||||||||||||||
Nonvested restricted shares outstanding at September 30, 2013 | 125,000 | 1.22 | $ | 330 | |||||||||||||
Nonvested restricted shares expected to vest at September 30, 2013 | 125,000 | 1.22 | $ | 330 | |||||||||||||
Share-Based Compensation Expense Of Share-Based Awards Granted | ' | ||||||||||||||||
Total share-based compensation expense of share-based awards granted to employees, non-employees and non-executive directors recognized for the years ended September 30, 2011, 2012 and 2013 are as follows: | |||||||||||||||||
As of September 30, | |||||||||||||||||
2011 | 2012 | 2013 | |||||||||||||||
US$ | US$ | US$ | |||||||||||||||
Cost of services | 1,999 | 37 | 56 | ||||||||||||||
General and administrative expenses | 3,347 | 88 | 522 | ||||||||||||||
Selling expenses | 678 | 16 | 47 | ||||||||||||||
6,024 | 141 | 625 | |||||||||||||||
Details_of_Subsidiaries_and_Va
Details of Subsidiaries and Variable Interest Entities (Detail) | 12 Months Ended |
Sep. 30, 2013 | |
China Distance Education Limited (CDEL Hong Kong) | ' |
Variable Interest Entity [Line Items] | ' |
Date of establishment | 13-Mar-03 |
Percentage of legal ownership by the Company | 100.00% |
Principal activities | 'Investment holding |
Practice Enterprises Network China International Links Limited (Pencil) | ' |
Variable Interest Entity [Line Items] | ' |
Date of establishment | 23-Feb-10 |
Percentage of legal ownership by the Company | 100.00% |
Principal activities | 'Inactive |
DL Education Service , LLC ("DL Education") | ' |
Variable Interest Entity [Line Items] | ' |
Date of establishment | 27-Sep-12 |
Percentage of legal ownership by the Company | 100.00% |
Principal activities | 'Inactive |
Beijing Champion Distance Education Technology Co., Ltd. ("Champion Technology") | ' |
Variable Interest Entity [Line Items] | ' |
Date of establishment | 5-Jan-04 |
Percentage of legal ownership by the Company | 100.00% |
Principal activities | 'Provision of technical support and consultancy services and course production |
Beijing Champion Education Technology Co Ltd (Champion Education Technology) | ' |
Variable Interest Entity [Line Items] | ' |
Date of establishment | 23-Apr-07 |
Percentage of legal ownership by the Company | 100.00% |
Principal activities | 'Software licensing and course production |
Beijing Champion Hi-Tech Co Ltd (Beijing Champion) | ' |
Variable Interest Entity [Line Items] | ' |
Date of establishment | 12-Jul-00 |
Principal activities | 'Provision of online education services and sales of books and reference materials |
Beijing Caikaowang Company Ltd (Caikaowang) | ' |
Variable Interest Entity [Line Items] | ' |
Date of establishment | 28-Nov-07 |
Principal activities | 'Provision of online education services |
Beijing Champion Wangge Education Technology Co Ltd (Champion Wangge) | ' |
Variable Interest Entity [Line Items] | ' |
Date of establishment | 24-Jun-08 |
Principal activities | 'Provision of online education services |
Beijing Zhengbao Yucai Education Technology Co Ltd (Zhengbao Yucai) | ' |
Variable Interest Entity [Line Items] | ' |
Date of establishment | 19-Feb-09 |
Principal activities | 'Provision of start-up training services |
Beijing Haidian District Champion Training School (Champion Training School) | ' |
Variable Interest Entity [Line Items] | ' |
Date of establishment | 19-Feb-09 |
Principal activities | 'Provision of online and offline education services |
Recovered_Sheet1
Organization and Basis of Presentation - Additional Information (Detail) | 12 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2012 | |
Basis Of Presentation And Organization [Line Items] | ' | ' |
Exclusive purchase right contract term | '10 years | ' |
Beijing Champion Hi-Tech Co Ltd (Beijing Champion) | ' | ' |
Basis Of Presentation And Organization [Line Items] | ' | ' |
Percent of assets | 68.00% | 53.00% |
Percent of liabilities | 93.00% | 95.00% |
Financial_Information_of_VIE_a
Financial Information of VIE and VIE's Subsidiaries (Detail) (USD $) | 12 Months Ended | |||||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 | |||
Variable Interest Entity [Line Items] | ' | ' | ' | |||
Cash and cash equivalents | $71,919 | $49,723 | ' | |||
Prepayment and other current assets | 4,087 | 3,573 | ' | |||
Total current assets | 84,685 | 69,648 | ' | |||
Total assets | 105,994 | 89,986 | ' | |||
Total current liabilities | 40,797 | 25,237 | ' | |||
Total liabilities | 41,474 | 25,369 | ' | |||
Total equity | 64,520 | 64,617 | ' | |||
Revenues | 71,360 | 52,102 | 41,564 | |||
Net income | 13,564 | 8,209 | -4,105 | |||
Net cash provided by operating activities | 32,138 | 15,063 | 9,192 | |||
Net cash (used in)/provided by investing activities | 4,506 | 471 | -9,843 | |||
Effects of exchange rate changes | 1,211 | 410 | 906 | |||
Consolidated VIE | ' | ' | ' | |||
Variable Interest Entity [Line Items] | ' | ' | ' | |||
Cash and cash equivalents | 39,706 | 15,798 | ' | |||
Prepayment and other current assets | 3,839 | 3,311 | ' | |||
Total current assets | 54,575 | 29,581 | ' | |||
Total assets | 72,515 | 47,381 | ' | |||
Deferred revenue | 17,120 | 9,408 | ' | |||
Total current liabilities | 38,442 | 24,041 | ' | |||
Total liabilities | 38,442 | 24,041 | ' | |||
Total equity | 34,073 | 23,340 | ' | |||
Revenues | 70,942 | 52,005 | 42,510 | |||
Net income | 21,062 | [1] | 14,944 | [1] | 7,365 | [1] |
Net cash provided by operating activities | 25,755 | 6,958 | 2,860 | |||
Net cash (used in)/provided by investing activities | -2,521 | 549 | -2,137 | |||
Effects of exchange rate changes | $674 | $183 | $481 | |||
[1] | This is net income before service fees charged by Champion Technology and Champion Education Technology. |
Property_Plant_and_Equipment_E
Property, Plant and Equipment Estimated Useful Lives of Assets (Detail) | 12 Months Ended |
Sep. 30, 2013 | |
Building | ' |
Property, Plant and Equipment [Line Items] | ' |
Estimated useful life | '35 years |
Building | Minimum | ' |
Property, Plant and Equipment [Line Items] | ' |
Estimated residual value | 5.00% |
Building | Maximum | ' |
Property, Plant and Equipment [Line Items] | ' |
Estimated residual value | 10.00% |
Electronic And Office Equipment | ' |
Property, Plant and Equipment [Line Items] | ' |
Estimated useful life | '5 years |
Electronic And Office Equipment | Minimum | ' |
Property, Plant and Equipment [Line Items] | ' |
Estimated residual value | 5.00% |
Electronic And Office Equipment | Maximum | ' |
Property, Plant and Equipment [Line Items] | ' |
Estimated residual value | 10.00% |
Motor vehicles | ' |
Property, Plant and Equipment [Line Items] | ' |
Estimated useful life | '5 years |
Motor vehicles | Minimum | ' |
Property, Plant and Equipment [Line Items] | ' |
Estimated residual value | 5.00% |
Motor vehicles | Maximum | ' |
Property, Plant and Equipment [Line Items] | ' |
Estimated residual value | 10.00% |
Leasehold Improvement And Building Improvement | ' |
Property, Plant and Equipment [Line Items] | ' |
Leasehold improvement and building improvement | 'Shorter of lease term or 5 years |
Other_Intangible_Assets_Estima
Other Intangible Assets Estimated Useful Lives (Detail) | 12 Months Ended |
Sep. 30, 2013 | |
Computer Software | Minimum | ' |
Finite-Lived Intangible Assets [Line Items] | ' |
Estimated useful life | '3 years |
Computer Software | Maximum | ' |
Finite-Lived Intangible Assets [Line Items] | ' |
Estimated useful life | '5 years |
Domain names and trademarks | Minimum | ' |
Finite-Lived Intangible Assets [Line Items] | ' |
Estimated useful life | '10 years |
Domain names and trademarks | Maximum | ' |
Finite-Lived Intangible Assets [Line Items] | ' |
Estimated useful life | '11 years |
Courseware | Minimum | ' |
Finite-Lived Intangible Assets [Line Items] | ' |
Estimated useful life | '1 year |
Courseware | Maximum | ' |
Finite-Lived Intangible Assets [Line Items] | ' |
Estimated useful life | '5 years |
Website | ' |
Finite-Lived Intangible Assets [Line Items] | ' |
Estimated useful life | '5 years |
Business Contracts | Minimum | ' |
Finite-Lived Intangible Assets [Line Items] | ' |
Estimated useful life | '3 years |
Business Contracts | Maximum | ' |
Finite-Lived Intangible Assets [Line Items] | ' |
Estimated useful life | '5 years |
Copyrights | ' |
Finite-Lived Intangible Assets [Line Items] | ' |
Estimated useful life | '5 years |
Platform | ' |
Finite-Lived Intangible Assets [Line Items] | ' |
Estimated useful life | '3 years 6 months |
Recovered_Sheet2
Significant Accounting Policies - Additional Information (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 |
Significant Accounting Policies [Line Items] | ' | ' | ' |
Participation in revenues and costs percentage | 50.00% | ' | ' |
Advertising expenses from continuing operations | $3,167 | $2,112 | $2,204 |
Advertising expense from discontinued operations | ' | 26 | 179 |
Shipping and handling costs from continuing operations | 489 | 252 | 330 |
Shipping and handling costs from discontinued operations | ' | 1 | 8 |
Cash and cash equivalents from the continuing operations and discontinued operations, denominated in RMB | 68,867 | 36,360 | ' |
Foreign currency risk, cash and cash equivalents, represented amount, percent | 95.80% | 73.10% | ' |
Accounts Receivable | Concentration Risk Customer One | ' | ' | ' |
Significant Accounting Policies [Line Items] | ' | ' | ' |
One customers accounts receivable, Maximum percentage | 46.30% | 43.70% | ' |
Beijing Champion Hi-Tech Co Ltd (Beijing Champion) | ' | ' | ' |
Significant Accounting Policies [Line Items] | ' | ' | ' |
Recognized revenues before business tax and related surcharges in connection with expired study cards | 164 | 113 | 103 |
Business tax and related surcharges, percent | 3.00% | 3.00% | 3.00% |
Business tax and related surcharges, amount | $1,986 | $1,331 | $918 |
PRC value added tax ("VAT"), general rate | 13.00% | ' | ' |
Beijing Champion Distance Education Technology Co., Ltd. ("Champion Technology") | ' | ' | ' |
Significant Accounting Policies [Line Items] | ' | ' | ' |
PRC value added tax ("VAT"), general rate | 6.00% | ' | ' |
Beijing Champion Education Technology Co Ltd (Champion Education Technology) | ' | ' | ' |
Significant Accounting Policies [Line Items] | ' | ' | ' |
PRC value added tax ("VAT"), general rate | 3.00% | ' | ' |
Recovered_Sheet3
Transactions in Connection with Acquired Business - Additional Information (Detail) | Sep. 30, 2011 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2011 | Sep. 30, 2010 | Sep. 30, 2009 | Sep. 30, 2009 | Sep. 30, 2009 | Sep. 30, 2010 | Sep. 30, 2013 | Sep. 30, 2011 | Sep. 30, 2011 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 |
In Thousands, unless otherwise specified | China International Economic And Trade Arbitration Commission | Beijing Zhengbao Yucai Education Technology Co Ltd (Zhengbao Yucai) | Beijing Zhengbao Yucai Education Technology Co Ltd (Zhengbao Yucai) | Beijing Zhengbao Yucai Education Technology Co Ltd (Zhengbao Yucai) | Beijing Zhengbao Yucai Education Technology Co Ltd (Zhengbao Yucai) | Beijing Zhengbao Yucai Education Technology Co Ltd (Zhengbao Yucai) | Beijing Zhengbao Yucai Education Technology Co Ltd (Zhengbao Yucai) | Yinhong | Yinhong | Zhejiang Champion Xinlixiang Education Management Co Ltd (Champion Xinlixiang) | Zhejiang Champion Xinlixiang Education Management Co Ltd (Champion Xinlixiang) | Zhejiang Champion Xinlixiang Education Management Co Ltd (Champion Xinlixiang) | Zhejiang Champion Xinlixiang Education Management Co Ltd (Champion Xinlixiang) | Zhejiang Champion Xinlixiang Education Management Co Ltd (Champion Xinlixiang) | Zhejiang Champion Xinlixiang Education Management Co Ltd (Champion Xinlixiang) | Zhejiang Champion Xinlixiang Education Management Co Ltd (Champion Xinlixiang) | Zhejiang Champion Xinlixiang Education Management Co Ltd (Champion Xinlixiang) |
USD ($) | USD ($) | CNY | USD ($) | USD ($) | USD ($) | CNY | USD ($) | CNY | USD ($) | CNY | Purchase Agreement Year One | Purchase Agreement Year One | Purchase Agreement Year Two | Purchase Agreement Year Two | Surrendered | ||
USD ($) | CNY | USD ($) | CNY | USD ($) | |||||||||||||
Business Acquisition [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Transferred equity interest | ' | ' | ' | 40.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Initial consideration, in cash | ' | ' | ' | $5,318 | $4 | $5,314 | ' | ' | ' | ' | $2,379 | 16,000 | ' | ' | ' | ' | ' |
Initial consideration for acquisition, transaction costs | ' | ' | ' | 56 | ' | ' | ' | ' | ' | ' | 37 | ' | ' | ' | ' | ' | ' |
Minimum net income, cash consideration, amount | ' | 6,881 | 47,000 | ' | ' | 3,296 | 22,500 | ' | ' | ' | ' | ' | 1,172 | 8,000 | 2,344 | 16,000 | ' |
Percentage of excess amount of net income additional cash consideration | ' | 30.00% | 30.00% | ' | ' | 40.00% | 40.00% | ' | ' | ' | ' | ' | 40.00% | 40.00% | 30.00% | 30.00% | ' |
Minimum Net Income Cash Consideration, Effective Fiscal Year | ' | '2010 | '2010 | ' | ' | ' | ' | ' | ' | ' | ' | ' | '2010 | '2010 | '2011 | '2011 | ' |
Purchase agreement, option to acquire additional equity interest, impaired amount | ' | ' | 43,200 | 1,115 | ' | ' | ' | ' | 34 | 19,200 | ' | ' | 477 | ' | 201 | ' | ' |
Purchase agreement, option to acquire additional equity interest, percent amount | ' | ' | ' | 40.00% | ' | 30.00% | 30.00% | 49.00% | ' | ' | 40.00% | 40.00% | ' | ' | ' | ' | 40.00% |
Purchase agreement, option to acquire additional equity interest, number of years | ' | ' | ' | ' | ' | '5 years | '5 years | '3 years | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Purchase agreement, subject to option, price (six times of the net income) | ' | ' | ' | ' | ' | 30.00% | 30.00% | 49.00% | ' | 40.00% | ' | ' | ' | ' | ' | ' | ' |
Option To Acquire Equity Interest Impaired Amount | ' | ' | ' | ' | 128 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
China International Economic and Trade Arbitration Commission awarded amount recorded as other operating income | 571 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net loss contingency, option to sell equity interest, cash amount | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $911 |
Allocation_of_Purchase_Price_t
Allocation of Purchase Price to Fair Values of Portion of Assets Acquired and Liabilities Assumed (Detail) (USD $) | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2009 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2009 | Sep. 30, 2009 | Mar. 10, 2009 | Mar. 10, 2009 | Mar. 10, 2009 | Mar. 10, 2009 | Mar. 10, 2009 | Mar. 10, 2009 | Mar. 10, 2009 | Mar. 10, 2009 | Mar. 10, 2009 | Mar. 10, 2009 | Mar. 10, 2009 |
In Thousands, unless otherwise specified | Zhejiang Champion Xinlixiang Education Management Co Ltd (Champion Xinlixiang) | Business Contracts | Business Contracts | Copyrights | Platform | Computer Software | Computer Software | Courseware | Courseware | Noncompete Agreements | Supplementary Domain Names | Beijing Zhengbao Yucai Education Technology Co Ltd (Zhengbao Yucai) | Beijing Zhengbao Yucai Education Technology Co Ltd (Zhengbao Yucai) | Beijing Zhengbao Yucai Education Technology Co Ltd (Zhengbao Yucai) | Beijing Zhengbao Yucai Education Technology Co Ltd (Zhengbao Yucai) | Beijing Zhengbao Yucai Education Technology Co Ltd (Zhengbao Yucai) | Beijing Zhengbao Yucai Education Technology Co Ltd (Zhengbao Yucai) | Beijing Zhengbao Yucai Education Technology Co Ltd (Zhengbao Yucai) | Beijing Zhengbao Yucai Education Technology Co Ltd (Zhengbao Yucai) | Beijing Zhengbao Yucai Education Technology Co Ltd (Zhengbao Yucai) | Beijing Zhengbao Yucai Education Technology Co Ltd (Zhengbao Yucai) | Beijing Zhengbao Yucai Education Technology Co Ltd (Zhengbao Yucai) | ||
Minimum | Maximum | Minimum | Maximum | Minimum | Maximum | Zhejiang Champion Xinlixiang Education Management Co Ltd (Champion Xinlixiang) | Zhejiang Champion Xinlixiang Education Management Co Ltd (Champion Xinlixiang) | Business Contracts | Business Contracts | Business Contracts | Copyrights | Platform | Domain Name | Domain Name | Domain Name | Computer Software | Courseware | |||||||
Minimum | Maximum | Minimum | Maximum | |||||||||||||||||||||
Schedule of Business Acquisitions, Purchase Price [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Deferred revenue | ' | ' | ($1,617) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cash | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,854 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Accounts receivable | ' | ' | 1,968 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Property, plant and equipment | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 138 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Purchased call option | ' | ' | 669 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,221 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Other intangible assets | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 650 | 1 | ' | 476 | ' | ' | 586 | 195 | 168 | ' | ' | 311 | 255 |
Amortization period | ' | ' | ' | '3 years | '5 years | '5 years | '3 years 6 months | '3 years | '5 years | '1 year | '5 years | '15 years | '10 years | ' | ' | '3 years | '5 years | '5 years | '3 years 6 months | ' | '10 years | '11 years | '3 years | '5 years |
Deferred tax liability | ' | ' | -330 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -382 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Income tax payable | ' | ' | -61 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Other payables | ' | ' | -107 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Noncontrolling interest | ' | ' | -937 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -2,107 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Goodwill | 7,711 | 7,511 | 2,143 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,603 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total consideration | ' | ' | $2,379 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $5,318 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Discontinued_Operations_Additi
Discontinued Operations - Additional Information (Detail) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2011 | 4-May-12 |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ' | ' |
Disposal group including discontinued operation goodwill impairment loss | $1,115 | ' |
Gaokao re-take business | ' | ' |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ' | ' |
Total cash proceeds from sale of discontinued operations | ' | 157 |
Disposal group including discontinued operation goodwill impairment loss | $2,063 | ' |
Assets_and_Liabilities_of_The_
Assets and Liabilities of The Discontinued Operations (Detail) (Gaokao re-take business, USD $) | 4-May-12 |
In Thousands, unless otherwise specified | |
Gaokao re-take business | ' |
Current assets of discontinued operations: | ' |
Cash and cash equivalents | $312 |
Accounts receivable, net | 14 |
Prepayment and other current assets | 324 |
Current assets of discontinued operations | 650 |
Current liabilities of discontinued operations: | ' |
Accrued expenses and other liabilities | 348 |
Income tax payable | 128 |
Deferred revenue, current portion | 314 |
Current liabilities of discontinued operations | 790 |
Net liabilities disposed | -140 |
Cash proceeds | 157 |
Gain on disposition of the discontinued operation | $297 |
Operating_Results_From_Discont
Operating Results From Discontinued Operations Included in Group's Consolidated Statement of Operations (Detail) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2012 | Sep. 30, 2011 |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ' | ' |
Net (loss) income from discontinued operations attributable to China Distance Education Holding Limited, net of tax | $236 | ($3,300) |
Gaokao re-take business | ' | ' |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ' | ' |
Revenues | 1,045 | 1,776 |
Pre-tax profit (loss) from discontinued operations | -61 | -3,444 |
Income tax expense | ' | 144 |
Income (loss) from discontinued operations, net of tax | -61 | -3,300 |
Gain on disposal of discontinued operation | 297 | ' |
Net (loss) income from discontinued operations attributable to China Distance Education Holding Limited, net of tax | $236 | ($3,300) |
Accounts_Receivable_Net_Detail
Accounts Receivable Net (Detail) (USD $) | Sep. 30, 2013 | Sep. 30, 2012 |
In Thousands, unless otherwise specified | ||
Accounts Receivable, Net, Current [Abstract] | ' | ' |
Accounts receivable | $5,291 | $6,173 |
Less: allowance for doubtful accounts | -1,773 | -2,092 |
Accounts receivable, net | $3,518 | $4,081 |
Movement_of_Allowance_For_Doub
Movement of Allowance For Doubtful Accounts (Detail) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Allowance for Doubtful Accounts Receivable [Roll Forward] | ' | ' |
Balance at beginning of year | $2,092 | $3,190 |
Charged to expenses | -371 | 211 |
Write-off of accounts receivable | ' | -1,361 |
Foreign currency adjustment | 52 | 52 |
Balance at end of the year | $1,773 | $2,092 |
Inventories_Net_Detail
Inventories Net (Detail) (USD $) | Sep. 30, 2013 | Sep. 30, 2012 |
In Thousands, unless otherwise specified | ||
Inventory [Line Items] | ' | ' |
Books and other goods | $708 | $632 |
Paper and other raw materials | 102 | 70 |
Less: inventory provisions for slow-moving and obsolescence | -112 | -44 |
Inventories, total | $698 | $658 |
Inventories_Net_Additional_Inf
Inventories Net - Additional Information (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 |
Inventory [Line Items] | ' | ' | ' |
Inventories provision | $67 | $41 | $1 |
Recovered_Sheet4
Prepayment and Other Current Assets (Detail) (USD $) | Sep. 30, 2013 | Sep. 30, 2012 | ||
In Thousands, unless otherwise specified | ||||
Prepaid Expense and Other Assets, Current [Abstract] | ' | ' | ||
Advance to the suppliers | $1,873 | [1] | $1,835 | [1] |
Prepaid expenses | 1,034 | 1,092 | ||
Refundable prepayments | ' | 325 | [2] | |
Current portion of receivables related to ITAT program (Note 13) | 285 | ' | ||
Funds receivable | 285 | [3] | 142 | [3] |
Deposits | 11 | 68 | ||
Others | 599 | 436 | ||
Less: allowance for doubtful accounts | ' | -325 | [2] | |
Prepayment and other current assets, net | $4,087 | $3,573 | ||
[1] | Advance to the suppliers represents interest-free cash deposits paid to suppliers for future purchase of raw materials and finished goods. The risk of loss arising from non-performance by or bankruptcy of the suppliers is assessed prior to making the deposits and is monitored on a regular basis by management. A charge to cost of sales will be recorded in the period in which a loss is incurred. To date, the Group has not experienced any loss of advances to suppliers. | |||
[2] | The group prepaid a refundable fee to a government agency in the year ended September 30, 2010 as a sponsor of ITAT contest which was subsequently cancelled. In 2013, the Group and the government agency agreed to cease a series of cooperations on ITAT program, including ITAT contest. Based on the termination agreement, the Group waived the amount of US$325 related to the sponsorship of ITAT contest and accordingly wrote off the refundable prepayments in 2013. The Group recorded a full allowance for such prepaid amount in 2012. | |||
[3] | Funds receivable arise due to the time taken to clear customers' payment transactions through external payment networks. When customers remit fees to the Group via external payment networks using their bank account or credit card, there is a clearing period before the cash is received by the Group which usually takes one to three business days. These fees are treated as a receivable until the cash is received. |
Recovered_Sheet5
Prepayment and Other Current Assets (Parenthetical) (Detail) (USD $) | Sep. 30, 2012 | |
In Thousands, unless otherwise specified | ||
Prepaid Expense and Other Assets, Current [Abstract] | ' | |
Refundable prepayments | $325 | [1] |
[1] | The group prepaid a refundable fee to a government agency in the year ended September 30, 2010 as a sponsor of ITAT contest which was subsequently cancelled. In 2013, the Group and the government agency agreed to cease a series of cooperations on ITAT program, including ITAT contest. Based on the termination agreement, the Group waived the amount of US$325 related to the sponsorship of ITAT contest and accordingly wrote off the refundable prepayments in 2013. The Group recorded a full allowance for such prepaid amount in 2012. |
Property_Plant_and_Equipment_D
Property, Plant and Equipment (Detail) (USD $) | Sep. 30, 2013 | Sep. 30, 2012 |
In Thousands, unless otherwise specified | ||
Property, Plant and Equipment [Line Items] | ' | ' |
Total | $17,419 | $16,036 |
Less: Accumulated depreciation | -7,217 | -6,360 |
Property, Plant and Equipment, Net | 10,202 | 9,676 |
Building | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Total | 6,051 | 5,892 |
Electronic And Office Equipment | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Total | 9,523 | 7,604 |
Leasehold Improvement And Building Improvement | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Total | 681 | 1,434 |
Motor vehicles | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Total | $1,164 | $1,106 |
Property_Plant_and_Equipment_A
Property, Plant and Equipment - Additional Information (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 |
Property, Plant and Equipment [Line Items] | ' | ' | ' |
Depreciation expenses from continuing operations | $1,848 | $1,606 | $1,309 |
Depreciation expenses from discontinued operations | ' | ' | $140 |
Goodwill_Detail
Goodwill (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 |
Goodwill [Line Items] | ' | ' | ' |
Beginning balance | $7,511 | $9,665 | ' |
Exchange difference | 200 | 108 | ' |
Disposal | ' | -2,262 | ' |
Ending balance | 7,711 | 7,511 | 9,665 |
Beginning balance | ' | 2,262 | ' |
Charge for the year | ' | ' | 758 |
Exchange difference | ' | ' | ' |
Disposal | ' | -2,262 | ' |
Ending balance | ' | ' | 2,262 |
Goodwill, net | 7,711 | 7,511 | ' |
Online Education Service | ' | ' | ' |
Goodwill [Line Items] | ' | ' | ' |
Beginning balance | 5,726 | 5,642 | ' |
Exchange difference | 154 | 84 | ' |
Ending balance | 5,880 | 5,726 | ' |
Charge for the year | ' | ' | ' |
Exchange difference | ' | ' | ' |
Goodwill, net | 5,880 | 5,726 | ' |
Beijing Zhengbao Yucai Education Technology Co Ltd (Zhengbao Yucai) | Startup Training Service | ' | ' | ' |
Goodwill [Line Items] | ' | ' | ' |
Beginning balance | 1,785 | 1,761 | ' |
Exchange difference | 46 | 24 | ' |
Ending balance | 1,831 | 1,785 | ' |
Charge for the year | ' | ' | ' |
Exchange difference | ' | ' | ' |
Goodwill, net | 1,831 | 1,785 | ' |
Zhejiang Champion Xinlixiang Education Management Co Ltd (Champion Xinlixiang) | Gaokao re-take business | ' | ' | ' |
Goodwill [Line Items] | ' | ' | ' |
Beginning balance | ' | 2,262 | ' |
Disposal | ' | -2,262 | ' |
Beginning balance | ' | -2,262 | ' |
Charge for the year | ' | ' | ' |
Exchange difference | ' | ' | ' |
Disposal | ' | ($2,262) | ' |
Composition_of_Other_Intangibl
Composition of Other Intangible Assets (Detail) (USD $) | Sep. 30, 2013 | Sep. 30, 2012 |
In Thousands, unless otherwise specified | ||
Finite-Lived Intangible Assets And Liabilities [Line Items] | ' | ' |
Total intangible assets | $6,440 | $6,005 |
Less: Accumulated amortization | -4,964 | -4,076 |
Other intangible assets, Net | 1,476 | 1,929 |
Computer Software | ' | ' |
Finite-Lived Intangible Assets And Liabilities [Line Items] | ' | ' |
Total intangible assets | 2,978 | 2,645 |
Less: Accumulated amortization | -2,275 | -1,827 |
Domain names and trademarks | ' | ' |
Finite-Lived Intangible Assets And Liabilities [Line Items] | ' | ' |
Total intangible assets | 1,456 | 1,407 |
Less: Accumulated amortization | -840 | -717 |
Website | ' | ' |
Finite-Lived Intangible Assets And Liabilities [Line Items] | ' | ' |
Total intangible assets | 106 | 103 |
Less: Accumulated amortization | -106 | -102 |
Courseware | ' | ' |
Finite-Lived Intangible Assets And Liabilities [Line Items] | ' | ' |
Total intangible assets | 488 | 475 |
Less: Accumulated amortization | -462 | -394 |
Business Contracts | ' | ' |
Finite-Lived Intangible Assets And Liabilities [Line Items] | ' | ' |
Total intangible assets | 531 | 517 |
Less: Accumulated amortization | -494 | -399 |
Copyrights | ' | ' |
Finite-Lived Intangible Assets And Liabilities [Line Items] | ' | ' |
Total intangible assets | 664 | 647 |
Less: Accumulated amortization | -600 | -455 |
Platform | ' | ' |
Finite-Lived Intangible Assets And Liabilities [Line Items] | ' | ' |
Total intangible assets | 217 | 211 |
Less: Accumulated amortization | ($187) | ($182) |
Other_Intangible_Assets_Net_Ad
Other Intangible Assets, Net - Additional Information (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 |
Finite-Lived Intangible Assets And Liabilities [Line Items] | ' | ' | ' |
Amortization expenses from continuing operations | $771 | $873 | $900 |
Amortization expenses from discontinuing operations | ' | ' | $26 |
Estimated_Amortization_Expense
Estimated Amortization Expenses for Other Intangible Assets (Detail) (USD $) | Sep. 30, 2013 | Sep. 30, 2012 |
In Thousands, unless otherwise specified | ||
Finite-Lived Intangible Assets And Liabilities [Line Items] | ' | ' |
2014 | $491 | ' |
2015 | 348 | ' |
2016 | 277 | ' |
2017 | 211 | ' |
2018 | 82 | ' |
2019 and thereafter | 67 | ' |
Other intangible assets, Net | $1,476 | $1,929 |
Fair_Value_Measurement_Additio
Fair Value Measurement - Additional Information (Detail) (USD $) | 12 Months Ended | |||||||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 | Sep. 30, 2011 | Sep. 30, 2011 | Sep. 30, 2009 | Sep. 30, 2011 | Sep. 30, 2009 | |
Gaokao re-take business | Beijing Zhengbao Yucai Education Technology Co Ltd (Zhengbao Yucai) | Beijing Zhengbao Yucai Education Technology Co Ltd (Zhengbao Yucai) | Zhejiang Champion Xinlixiang Education Management Co Ltd (Champion Xinlixiang) | Zhejiang Champion Xinlixiang Education Management Co Ltd (Champion Xinlixiang) | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' |
Impairment during the year | ' | ' | ' | ' | $1,115,000 | ' | $201,000 | ' |
Assets | ' | ' | ' | ' | 0 | ' | 0 | ' |
Purchase agreement, option to acquire additional equity interest, percent amount | ' | ' | ' | ' | 40.00% | 30.00% | 40.00% | ' |
Impairment of goodwill | ' | ' | 758,000 | 758,000 | ' | ' | ' | ' |
Goodwill | 7,711,000 | 7,511,000 | ' | 0 | ' | ' | ' | 2,143,000 |
Impairment of property, plant and equipment | ' | ' | ' | 973,000 | ' | ' | ' | ' |
Impairment of non-compete agreement | ' | ' | $332,000 | $332,000 | ' | ' | ' | ' |
Deposits_for_NonCurrent_Assets
Deposits for Non-Current Assets (Detail) (USD $) | Sep. 30, 2013 | Sep. 30, 2012 |
Property, Plant and Equipment [Line Items] | ' | ' |
Deposit for purchase of non-current assets | $374 | $131 |
Property, Plant And Equipment | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Deposit for purchase of non-current assets | $374 | $131 |
Other_NonCurrent_Assets_Detail
Other Non-Current Assets (Detail) (USD $) | Sep. 30, 2013 | Sep. 30, 2012 | ||
In Thousands, unless otherwise specified | ||||
Other Assets Noncurrent [Line Items] | ' | ' | ||
Long-term prepaid expenses | $1,207 | [1] | $462 | [1] |
Long-term receivables | 171 | [2] | 504 | [2] |
Rental deposits | 168 | [3] | 125 | [3] |
Other Assets, Miscellaneous, Total | $1,546 | $1,091 | ||
[1] | Long-term prepaid expenses represent golf club membership fee valid for a period of ten years. The amortization of the long term prepaid expenses was included in "general and administrative expenses" on the consolidated statements of operations. | |||
[2] | Long-term receivables represent the non-current portion of prepaid service fee for obtaining government authorization to provide the ITAT program, an information technique application training program, for ten years, starting from 2010. The group amortized such prepayment on a straight-line basis. In 2013, the Group ceased a series of cooperation on ITAT program. Based on the termination agreement signed in July 2013, the remaining unamortized prepaid service fee will be repaid within next 48 months. Accordingly, as of September 30, 2013, US$285 and US$171 were recorded as current portion and non-current portion of receivables due from the government agency respectively (see Note 7). | |||
[3] | Rental deposits represent office rental deposits for the Group's daily operations. These deposits are classified as non-current deposits since they will not be refunded within one year. |
Other_NonCurrent_Assets_Parent
Other Non-Current Assets (Parenthetical) (Detail) (USD $) | Sep. 30, 2013 | Sep. 30, 2012 | ||
In Thousands, unless otherwise specified | ||||
Other Assets Noncurrent [Line Items] | ' | ' | ||
Period over which golf club membership fee is valid | '10 years | ' | ||
Prepaid service fee repayment period | '48 months | ' | ||
Current portion of receivables due from government agency | $285 | ' | ||
Non-current portion of receivables due from government agency | $171 | [1] | $504 | [1] |
[1] | Long-term receivables represent the non-current portion of prepaid service fee for obtaining government authorization to provide the ITAT program, an information technique application training program, for ten years, starting from 2010. The group amortized such prepayment on a straight-line basis. In 2013, the Group ceased a series of cooperation on ITAT program. Based on the termination agreement signed in July 2013, the remaining unamortized prepaid service fee will be repaid within next 48 months. Accordingly, as of September 30, 2013, US$285 and US$171 were recorded as current portion and non-current portion of receivables due from the government agency respectively (see Note 7). |
Components_of_Accrued_Expenses
Components of Accrued Expenses and Other Liabilities (Detail) (USD $) | Sep. 30, 2013 | Sep. 30, 2012 |
In Thousands, unless otherwise specified | ||
Accrued Expenses and Other Current Liabilities [Line Items] | ' | ' |
Accrued expenses | $2,795 | $2,597 |
Salary and welfare payable | 2,775 | 1,823 |
Tuition fee payables to government agencies | 5,132 | 2,765 |
Remuneration payable to lecturers | 2,314 | 1,883 |
Uncertain income tax liabilities (Note 18) | 177 | 173 |
Payables to employees in connection with options exercise | 458 | ' |
Other payable | 1,421 | 395 |
Accrued expenses and other liabilities | $15,072 | $9,636 |
Ordinary_Shares_Additional_Inf
Ordinary Shares - Additional Information (Detail) (USD $) | 0 Months Ended | 12 Months Ended | |||
Apr. 29, 2011 | Nov. 20, 2008 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 | |
Class of Stock [Line Items] | ' | ' | ' | ' | ' |
Approved program, issued and outstanding shares authorized for repurchase, maximum value | ' | $10,000,000 | ' | ' | ' |
Stock repurchase program, additional authorized amount, value | 10,000,000 | ' | ' | ' | ' |
Repurchase of ordinary shares | ' | ' | 93,000 | 993,000 | 8,138,000 |
Ordinary shares | ' | ' | ' | ' | ' |
Class of Stock [Line Items] | ' | ' | ' | ' | ' |
Repurchase of ordinary shares, shares | ' | ' | 67,100 | 1,285,464 | 9,223,188 |
Repurchase of ordinary shares | ' | ' | ' | ' | $1,000 |
Restricted_Net_Assets_Addition
Restricted Net Assets - Additional Information (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 |
Restricted Assets And Liabilities Relating To Securitization [Line Items] | ' | ' | ' |
Minimum required percent of annual after-tax profit, general reserve | 10.00% | ' | ' |
Required reserve, percent of respective registered capital | 50.00% | ' | ' |
Minimum required percent of annual after-tax profit, statutory common reserve | 10.00% | ' | ' |
Appropriation to the statutory reserve | $3,292 | $3,206 | $2,388 |
Aggregate amount of paid-in capital and statutory reserves not available for distribution | $23,457 | $17,835 | ' |
Noncontrolling_Interests_Addit
Noncontrolling Interests - Additional Information (Detail) | Sep. 30, 2010 | Jun. 01, 2011 | Mar. 10, 2009 | Mar. 10, 2009 | Sep. 30, 2009 |
Beijing Champion Hi-Tech Co Ltd (Beijing Champion) | Beijing Zhengbao Yucai Education Technology Co Ltd (Zhengbao Yucai) | Startup Training Service | Startup Training Service | Gaokao re-take business | |
Beijing Champion Hi-Tech Co Ltd (Beijing Champion) | |||||
Noncontrolling Interest [Line Items] | ' | ' | ' | ' | ' |
Noncontrolling Interest, Ownership Percentage by Parent | 40.00% | 40.00% | 60.00% | ' | 60.00% |
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners | ' | ' | ' | 40.00% | 40.00% |
Noncontrolling_Interest_Detail
Noncontrolling Interest (Detail) (USD $) | 12 Months Ended | 12 Months Ended | |||||
In Thousands, unless otherwise specified | Sep. 30, 2011 | Sep. 30, 2011 | Sep. 30, 2011 | Sep. 30, 2011 | Sep. 30, 2011 | Sep. 30, 2010 | Sep. 30, 2011 |
Beijing Champion Hi-Tech Co Ltd (Beijing Champion) | Beijing Champion Wangge Education Technology Co Ltd (Champion Wangge) | Startup Training Service | Startup Training Service | Gaokao re-take business | Gaokao re-take business | ||
Beijing Champion Hi-Tech Co Ltd (Beijing Champion) | Beijing Champion Wangge Education Technology Co Ltd (Champion Wangge) | ||||||
Noncontrolling Interest [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Beginning Balance | $2,037 | ' | ' | $1,126 | ' | $911 | ' |
Net loss for the year | -303 | ' | ' | -303 | ' | ' | ' |
Foreign currency translation adjustments | 33 | ' | ' | 33 | ' | ' | ' |
Acquisition of noncontrolling interest | ' | -856 | -911 | ' | -856 | ' | -911 |
Ending Balance | ' | ' | ' | ' | ' | $911 | ' |
Taxation_Additional_Informatio
Taxation - Additional Information (Detail) (USD $) | 12 Months Ended | |||||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 | Sep. 30, 2010 | Sep. 30, 2009 | Sep. 30, 2008 |
Income Tax Disclosure [Line Items] | ' | ' | ' | ' | ' | ' |
Income tax rate | 25.00% | 25.00% | 25.00% | ' | ' | ' |
Withholding tax rate | 5.00% | ' | ' | ' | ' | ' |
Withholding tax on undistributed earnings | 905 | 634 | ' | ' | ' | ' |
Income tax expenses | 3,797 | 2,600 | 971 | ' | ' | ' |
Unrecognized tax benefits | 177 | 173 | 170 | ' | ' | ' |
Beijing Champion Hi-Tech Co Ltd (Beijing Champion) | ' | ' | ' | ' | ' | ' |
Income Tax Disclosure [Line Items] | ' | ' | ' | ' | ' | ' |
Preferential income tax rate | 15.00% | 15.00% | 15.00% | 15.00% | 15.00% | 15.00% |
Beijing Champion Distance Education Technology Co., Ltd. ("Champion Technology") | ' | ' | ' | ' | ' | ' |
Income Tax Disclosure [Line Items] | ' | ' | ' | ' | ' | ' |
Preferential income tax rate | 15.00% | 15.00% | 15.00% | 15.00% | 7.50% | 7.50% |
China Distance Education Limited (CDEL Hong Kong) | ' | ' | ' | ' | ' | ' |
Income Tax Disclosure [Line Items] | ' | ' | ' | ' | ' | ' |
Withholding tax on undistributed earnings | 905 | 634 | ' | ' | ' | ' |
Income tax expenses | 271 | 634 | ' | ' | ' | ' |
Income_Loss_before_Income_Taxe
Income (Loss) before Income Taxes from Continuing Operations (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 |
Income Before Income Taxes [Line Items] | ' | ' | ' |
Non - PRC | ($2,003) | ($1,252) | ($6,873) |
PRC | 19,364 | 11,825 | 7,039 |
Income before income taxes | $17,361 | $10,573 | $166 |
Current_and_Deferred_Component
Current and Deferred Components of Income Tax Benefit/(Expense) from Continuing Operations (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 |
Components Of Income Tax Expense Benefit [Line Items] | ' | ' | ' |
Current tax expense | $3,107 | $2,074 | $1,948 |
Deferred tax (benefit)/expense | 690 | 526 | -977 |
Income Tax Expense (Benefit), Total | $3,797 | $2,600 | $971 |
Reconciliation_of_Effective_Ta
Reconciliation of Effective Tax Rate (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 |
Schedule of Effective Tax Rate Reconciliation [Line Items] | ' | ' | ' |
Income before taxes | $17,361 | $10,573 | $166 |
Income tax expense (benefit) computed a applicable tax rates of 25% | 4,340 | 2,643 | 42 |
Effect of different tax rates indifferent jurisdictions | 440 | 255 | 1,667 |
Non-deductible expenses | 75 | 59 | 260 |
Effect of tax holidays | -1,740 | -1,037 | -860 |
Effect of valuation allowances | 194 | 51 | -138 |
Effect of tax rate changes | 237 | ' | ' |
Withholding tax on undistributed earnings | 251 | 629 | ' |
Income Tax Expense (Benefit), Total | $3,797 | $2,600 | $971 |
Effective income tax rate | 21.87% | 24.59% | 584.94% |
Reconciliation_of_Effective_Ta1
Reconciliation of Effective Tax Rate (Parenthetical) (Detail) | 12 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 | |
Schedule of Effective Tax Rate Reconciliation [Line Items] | ' | ' | ' |
Income tax expense (benefit), applicable tax rates | 25.00% | 25.00% | 25.00% |
Aggregate_Amount_and_Per_Share
Aggregate Amount and Per Share Effect of Tax Holidays (Detail) (USD $) | 12 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 |
The aggregate amount of tax holidays | $1,740 | $1,037 | $860 |
Basic | ' | ' | ' |
The aggregate effect on basic and diluted net income per share: | $0.01 | $0.01 | $0.01 |
Diluted | ' | ' | ' |
The aggregate effect on basic and diluted net income per share: | $0.01 | $0.01 | $0.01 |
Components_of_Deferred_Taxes_f
Components of Deferred Taxes from Continuing Operations (Detail) (USD $) | Sep. 30, 2013 | Sep. 30, 2012 |
In Thousands, unless otherwise specified | ||
Deferred Income Tax Assets And Liabilities [Line Items] | ' | ' |
Payroll payable | $409 | $291 |
Accrued expenses | 585 | 524 |
Allowance for doubtful accounts | 518 | 592 |
Net operating loss carry-forwards | 289 | 449 |
Total current deferred tax assets | 1,801 | 1,856 |
Less: valuation allowance | -50 | ' |
Current deferred tax assets, net | 1,751 | 1,856 |
Intangible assets | 48 | 87 |
Property, plant and equipment | 148 | 146 |
Net operating loss carry-forwards | 372 | 522 |
Total non-current deferred tax assets | 568 | 755 |
Less: valuation allowance | -262 | -117 |
Non-current deferred tax assets, net | 306 | 638 |
Intangible assets | 78 | 136 |
Withholding tax on undistributed earnings | 905 | 634 |
Total non-current deferred tax liabilities | $983 | $770 |
Reconciliation_of_Accrued_Unre
Reconciliation of Accrued Unrecognized Tax Benefits (Detail) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Schedule of Unrecognized Tax Benefits [Line Items] | ' | ' |
Beginning balance | $173 | $170 |
Foreign currency adjustment | 4 | 3 |
Ending balance | $177 | $173 |
Recovered_Sheet6
Employee Defined Contribution Plan - Additional Information (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 |
Deferred Compensation Arrangement with Individual, Postretirement Benefits [Line Items] | ' | ' | ' |
Total contributions to the government, employee benefits, expensed as incurred | $3,910 | $3,199 | $2,464 |
Employee Benefits From Continuing Operations | 3,910 | 3,164 | 2,412 |
Employee benefits from discontinued operations | ' | 35 | 52 |
Employee benefits, mandatory contributions to defined contribution retirement plans for full time employees in Hong Kong | $2 | $2 | $2 |
Operating_Lease_Commitments_De
Operating Lease Commitments (Detail) (USD $) | Sep. 30, 2013 |
In Thousands, unless otherwise specified | |
Commitments and Contingencies [Line Items] | ' |
2014 | $1,637 |
2015 | 80 |
2016 | 58 |
2017 | 5 |
Operating leases, future minimum payments due, total | $1,780 |
Recovered_Sheet7
Commitments and Contingencies - Additional Information (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 |
Commitment And Contingencies [Line Items] | ' | ' | ' |
Operating leases rent expenses, continuing operations | $3,904 | $3,346 | $2,844 |
Operating leases rent expenses, discontinued operations | ' | $314 | $750 |
Revenues_Attributable_to_Diffe
Revenues Attributable to Different Service and Product Groups (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 |
Segment Reporting Information [Line Items] | ' | ' | ' |
Revenues | $71,360 | $52,102 | $41,564 |
Online Education Service | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' |
Revenues | 58,573 | 40,281 | 30,788 |
Books And Reference Materials | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' |
Revenues | 5,129 | 4,438 | 4,743 |
Offline Education Service | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' |
Revenues | 4,617 | 4,507 | 2,907 |
Others | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' |
Revenues | $3,041 | $2,876 | $3,126 |
Segment_Reporting_Additional_I
Segment Reporting - Additional Information (Detail) (Online Education Service, Sales Revenue, Net) | 12 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 | |
Online Education Service | Sales Revenue, Net | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' |
Percentage of total contract revenue from Online education services, percent | 82.10% | 77.30% | 74.00% |
Basic_and_Diluted_Net_Loss_Inc
Basic and Diluted Net (Loss) Income per Share (Detail) (USD $) | 12 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 |
Earnings Per Share Disclosure [Line Items] | ' | ' | ' |
Net income (loss) from continuing operations | $13,564 | $7,973 | ($502) |
Net income (loss) from discontinued operations, net of tax | ' | 236 | -3,300 |
Net income (loss) attributable to China Distance Education Holdings Limited | 13,564 | 8,209 | -3,802 |
- allocated to ordinary share - basic | 13,554 | 8,209 | -3,800 |
Allocated to nonvested restricted share - basic | $10 | ' | ($2) |
Weighted average number of ordinary shares outstanding | 135,174,562 | 133,996,737 | 133,489,261 |
Weighted average number of nonvested restricted share | 103,082 | ' | 82,466 |
Plus incremental weighted average ordinary shares from assumed exercise of share options using the treasury stock method | 1,121,589 | 366,371 | ' |
Weighted average ordinary shares outstanding used in computing diluted net income per share | 136,399,233 | 134,363,108 | 133,571,727 |
Basic net (loss) income per share, Basic from continuing operations | $0.10 | $0.06 | $0 |
Basic net (loss) income per share, Basic from discontinued operations (net of tax) | ' | $0 | ($0.03) |
Basic net (loss) income per share, Basic | $0.10 | $0.06 | ($0.03) |
Basic net (loss) income per nonvested restricted share, Basic from continuing operations | $0.10 | ' | ' |
Basic net (loss) income per nonvested restricted share, Basic from discontinued operations (net of tax) | ' | ' | ($0.03) |
Basic net (loss) income per nonvested restricted share, Basic | $0.10 | ' | ($0.03) |
Diluted from continuing operations | $0.10 | $0.06 | $0 |
Diluted from discontinued operations (net of tax) | ' | $0 | ($0.03) |
Diluted net (loss) income per share, Diluted | $0.10 | $0.06 | ($0.03) |
Share_Incentive_Plan_Additiona
Share Incentive Plan - Additional Information (Detail) (USD $) | 0 Months Ended | 1 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended | 0 Months Ended | ||||||||||||||||||||
In Thousands, except Share data, unless otherwise specified | Sep. 27, 2011 | Dec. 03, 2010 | Nov. 17, 2009 | Dec. 02, 2008 | Jul. 02, 2008 | 31-May-08 | Apr. 18, 2008 | Jul. 31, 2010 | Nov. 30, 2009 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 | Sep. 30, 2010 | Sep. 30, 2009 | Nov. 17, 2009 | Apr. 18, 2008 | Nov. 17, 2009 | Apr. 18, 2008 | Apr. 18, 2008 | Apr. 18, 2008 | Sep. 30, 2013 | Dec. 03, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 | 21-May-13 | Nov. 17, 2013 |
Employee | Scenario 1 | Scenario 1 | Scenario 2 | Scenario 2 | Employee Stock Option | Share Awards | Options Cancelled | Non Vested Restricted Stock Awards | Non Vested Restricted Stock Awards | Nonvested Shares | Nonvested Shares | Nonvested Shares | Director | Employees | ||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Maximum number of ordinary shares that may be issued pursuant to the Prior Plan, shares | ' | ' | ' | ' | ' | ' | 11,652,556 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Ordinary shares, par value | ' | ' | ' | ' | ' | ' | $0.00 | ' | ' | $0.00 | $0.00 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Maximum number of ordinary shares that may be issued pursuant to the New Plan, percent | ' | ' | ' | ' | 5.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Vesting period | ' | ' | ' | '2 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '4 years | '1 year | ' | ' | ' | ' | ' | ' | ' | ' |
Contractual terms | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '10 years | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share options granted | 9,465,000 | ' | ' | 400,000 | ' | ' | 11,045,500 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share options granted to selected employees, shares | 1,000,600 | ' | 1,361,900 | ' | ' | 10,060,600 | 10,060,600 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share options granted to non-employees | 400,000 | 100,000 | ' | ' | ' | ' | 984,900 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share options granted to selected employees exercise, price | $0.62 | ' | $1.87 | ' | ' | ' | $3.00 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Vesting schedule | ' | ' | ' | 50.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 75.00% | 75.00% | 25.00% | 25.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Exercise price | ' | ' | ' | $0.82 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based compensation arrangement by share-based payment award, plan modification, incremental Compensation Cost | $1,658 | ' | ' | $2,699 | ' | ' | ' | ' | ' | ' | ' | ' | $853 | $752 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of employees to whom stock options granted | ' | ' | ' | 260 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of non-employees to whom stock options granted | ' | ' | ' | 17 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Options cancelled | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,120,900 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 400,000 | 720,900 |
Exercise price per share | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $1.87 |
Stock-based compensation | ' | 125 | ' | ' | ' | ' | ' | ' | ' | 625 | 141 | 6,024 | ' | ' | ' | ' | ' | ' | ' | ' | 146 | ' | ' | ' | ' | ' | ' | ' |
Total intrinsic value of options exercised | ' | ' | ' | ' | ' | ' | ' | ' | ' | 487 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Compensation expenses, restricted shares issued to independent director, shares | ' | ' | ' | ' | 57,143 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total compensation cost to be recognized over 3 years | ' | ' | ' | ' | 300 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Compensation expenses, cash paid | ' | ' | ' | ' | ' | ' | ' | 100 | 100 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Grant date fair value non vested restricted share | ' | $1.25 | ' | ' | ' | ' | ' | ' | ' | $1.22 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $1.22 | ' | ' | ' | ' | ' | ' |
Nonvested restricted shares granted | ' | ' | ' | ' | ' | ' | ' | ' | ' | 225,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 225,000 | ' | ' | ' | ' | ' | ' |
Shares vested on grant date | ' | ' | ' | ' | ' | ' | ' | ' | ' | 100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 100,000 | ' | ' | ' | ' | ' | ' |
Total share base compensation | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 276 | ' | ' | ' | ' | ' | ' |
Share-based compensation expenses | ' | ' | ' | ' | ' | ' | ' | ' | ' | 625 | 141 | 6,024 | ' | ' | ' | ' | ' | ' | ' | ' | ' | 122 | 154 | 250 | 21 | 104 | ' | ' |
Share-based compensation requisite service period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '1 year | ' | ' | ' | ' | ' | ' |
Total fair value of shares vested | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 122 | ' | 125 | ' | ' |
Share-based compensation related to nonvested shares that is expected to be recognized | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $26 | ' | ' | ' | ' |
Share-based compensation related to nonvested shares that is expected to be recognized, weighted average period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '2 months 12 days | ' | ' | ' | ' |
Summary_of_Option_Activity_Det
Summary of Option Activity (Detail) (USD $) | 12 Months Ended | |||
Sep. 30, 2013 | Sep. 30, 2012 | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ||
Number of shares, Outstanding, Beginning | 3,747,024 | ' | ||
Number of shares, Exercised | 964,092 | ' | ||
Number of shares, Forfeited | 82,300 | ' | ||
Number of shares, Cancelled | 1,120,900 | ' | ||
Number of shares, Outstanding, Ending | 1,579,732 | 3,747,024 | ||
Number of shares, Expected to vest | ' | ' | ||
Number of shares, Exercisable | 1,579,732 | ' | ||
Weighted-average exercise price, Outstanding, Beginning | $0.87 | [1] | ' | |
Weighted-average exercise price, Exercised | $0.61 | ' | ||
Weighted-average exercise price, Forfeited | $1.41 | ' | ||
Weighted-average exercise price, Cancelled | $1.38 | ' | ||
Weighted-average exercise price, Outstanding, Ending | $0.50 | $0.87 | [1] | |
Weighted-average exercise price: Expected to vest | ' | ' | ||
Weighted-average exercise price: Exercisable | $0.50 | ' | ||
Weighted-average remaining contractual term (years), Outstanding | '6 years 4 months 13 days | '7 years | ||
Weighted-average remaining contractual term (years), Expected to vest | '0 years | ' | ||
Weighted-average remaining contractual term (years), Exercisable | '6 years 4 months 13 days | ' | ||
Aggregated intrinsic value, Outstanding, Ending | $3,389 | ' | ||
Aggregated intrinsic value, Expected to vest | ' | ' | ||
Aggregated intrinsic value, Exercisable | $3,389 | ' | ||
[1] | On November 13, 2012, the Company approved and declared a cash dividend of US$0.12 per ordinary share on its outstanding shares to shareholders as of December 7, 2012 and according to the terms of the Prior and New Plan, reduced the exercise price by US$0.12 for all of the outstanding options as of December 7, 2012. The change in exercise price was incurred in the year ended September 30, 2013, and therefore was not reflected in the weighted-average exercise price as of September 30, 2012. |
Share_Options_Nonemployees_Det
Share Options, Nonemployees (Detail) (USD $) | 12 Months Ended | |||
Sep. 30, 2013 | Sep. 30, 2012 | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ||
Number of shares, Outstanding, Beginning | 3,747,024 | ' | ||
Number of shares, Exercised | 964,092 | ' | ||
Number of shares, Outstanding, Ending | 1,579,732 | 3,747,024 | ||
Number of shares, Expected to vest | ' | ' | ||
Number of shares, Exercisable | 1,579,732 | ' | ||
Weighted-average exercise price, Outstanding, Beginning | $0.87 | [1] | ' | |
Weighted-average exercise price, Exercised | $0.61 | ' | ||
Weighted-average exercise price, Outstanding, Ending | $0.50 | $0.87 | [1] | |
Weighted-average exercise price: Expected to vest | ' | ' | ||
Weighted-average exercise price: Exercisable | $0.50 | ' | ||
Weighted-average remaining contractual term (years), Outstanding | '6 years 4 months 13 days | '7 years | ||
Weighted-average remaining contractual term (years), Expected to vest | '0 years | ' | ||
Weighted-average remaining contractual term (years), Exercisable | '6 years 4 months 13 days | ' | ||
Aggregated intrinsic value, Outstanding, Ending | $3,389 | ' | ||
Aggregated intrinsic value, Expected to vest | ' | ' | ||
Aggregated intrinsic value, Exercisable | 3,389 | ' | ||
Non Employee | ' | ' | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ||
Number of shares, Outstanding, Beginning | 151,500 | ' | ||
Number of shares, Exercised | 23,300 | ' | ||
Number of shares, Outstanding, Ending | 128,200 | 151,500 | ||
Number of shares, Expected to vest | ' | ' | ||
Number of shares, Exercisable | 128,200 | ' | ||
Weighted-average exercise price, Outstanding, Beginning | $0.62 | [1] | ' | |
Weighted-average exercise price, Exercised | $0.50 | ' | ||
Weighted-average exercise price, Outstanding, Ending | $0.50 | $0.62 | [1] | |
Weighted-average exercise price: Expected to vest | ' | ' | ||
Weighted-average exercise price: Exercisable | $0.50 | ' | ||
Weighted-average remaining contractual term (years), Outstanding | '4 years 6 months 18 days | '5 years 6 months 18 days | ||
Weighted-average remaining contractual term (years), Expected to vest | '0 years | ' | ||
Weighted-average remaining contractual term (years), Exercisable | '4 years 6 months 18 days | ' | ||
Aggregated intrinsic value, Outstanding, Beginning | 25 | ' | ||
Aggregated intrinsic value, Outstanding, Ending | 275 | 25 | ||
Aggregated intrinsic value, Expected to vest | ' | ' | ||
Aggregated intrinsic value, Exercisable | $275 | ' | ||
[1] | On November 13, 2012, the Company approved and declared a cash dividend of US$0.12 per ordinary share on its outstanding shares to shareholders as of December 7, 2012 and according to the terms of the Prior and New Plan, reduced the exercise price by US$0.12 for all of the outstanding options as of December 7, 2012. The change in exercise price was incurred in the year ended September 30, 2013, and therefore was not reflected in the weighted-average exercise price as of September 30, 2012. |
Share_Options_Nonemployees_Par
Share Options, Nonemployees (Parenthetical) (Detail) (Non Employee, USD $) | 0 Months Ended |
Dec. 07, 2012 | |
Non Employee | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Dividends payable, amount per share | $0.12 |
Authorized reduction in exercise price of outstanding options | $0.12 |
Estimated_Fair_Value_of_The_Sh
Estimated Fair Value of The Share Options, Assumptions Used (Detail) | 12 Months Ended |
Sep. 30, 2013 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Risk-free interest rate, minimum | 1.40% |
Risk-free interest rate, maximum | 1.86% |
Dividend yield | ' |
Expected volatility | 51.00% |
Minimum | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Expected life (in years) | '3 years 8 months 16 days |
Maximum | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Expected life (in years) | '5 years 7 months 17 days |
Nonvested_Restricted_Shares_Ac
Nonvested Restricted Shares Activity (Detail) (USD $) | 0 Months Ended | 12 Months Ended |
Dec. 03, 2010 | Sep. 30, 2013 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' |
Aggregated intrinsic value, Nonvested restricted shares outstanding | ' | $330 |
Aggregated intrinsic value, Nonvested restricted shares outstanding | ' | 330 |
Aggregated intrinsic value, Expected to vest | ' | 330 |
Granted | ' | 225,000 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period | ' | 100,000 |
Nonvested restricted shares outstanding, Ending balance | ' | 125,000 |
Nonvested restricted shares, Expected to vest | ' | 125,000 |
Weighted average grant-date fair value, Granted | $1.25 | $1.22 |
Weighted average grant-date fair value, Vested | ' | $1.22 |
Weighted average grant-date fair value, outstanding Ending balance | ' | $1.22 |
Weighted average grant-date fair value, Expected to vest | ' | $1.22 |
Total_ShareBased_Compensation_
Total Share-Based Compensation Expense (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' |
Total share-based compensation expense | $625 | $141 | $6,024 |
Cost of Services | ' | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' |
Total share-based compensation expense | 56 | 37 | 1,999 |
General and Administrative Expense | ' | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' |
Total share-based compensation expense | 522 | 88 | 3,347 |
Selling Expense | ' | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' |
Total share-based compensation expense | $47 | $16 | $678 |
Cash_Dividend_Additional_Infor
Cash Dividend - Additional Information (Detail) (USD $) | 0 Months Ended | 12 Months Ended | ||||
In Thousands, except Share data, unless otherwise specified | Nov. 13, 2012 | Nov. 16, 2011 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 07, 2012 | Dec. 15, 2011 |
Cash dividend declared per ordinary share | $0.12 | $0.12 | ' | ' | ' | ' |
Ordinary shares, outstanding | ' | ' | 135,532,141 | 134,386,849 | 135,409,521 | 135,565,361 |
Dividends | $16,056 | $16,268 | $16,056 | $16,268 | ' | ' |
Subsequent_Events_Additional_I
Subsequent Events - Additional Information (Detail) (Subsequent Event) | 0 Months Ended | |||
In Millions, except Per Share data, unless otherwise specified | Nov. 20, 2013 | Dec. 06, 2013 | Dec. 06, 2013 | Dec. 06, 2013 |
USD ($) | China Distance Education Limited (CDEL Hong Kong) | China Distance Education Limited (CDEL Hong Kong) | Beijing Champion Distance Education Technology Co., Ltd. ("Champion Technology") | |
Term Loan | Term Loan | Term Loan | ||
USD ($) | CNY | CNY | ||
Subsequent Event [Line Items] | ' | ' | ' | ' |
Dividends payable, date declared | 20-Nov-13 | ' | ' | ' |
Dividends payable, amount per share | $0.15 | ' | ' | ' |
Dividends payable, date of record | 8-Jan-14 | ' | ' | ' |
Authorized reduction in exercise price of outstanding options | $0.15 | ' | ' | ' |
Term loan agreement value | ' | $16 | 100 | ' |
Term loan agreement interest rate | ' | 2.40% | 2.40% | ' |
Term loan maturity period | ' | '18 months | '18 months | ' |
Payments to Acquire Term Deposit | ' | ' | ' | 100 |
Term loan draw down date | ' | '2014-01 | '2014-01 | ' |
Schedule_I_BALANCE_SHEETS_Deta
Schedule I - BALANCE SHEETS (Detail) (USD $) | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 | Sep. 30, 2010 |
In Thousands, unless otherwise specified | ||||
Current assets | ' | ' | ' | ' |
Cash and cash equivalents | $71,919 | $49,723 | ' | ' |
Prepayment and other current assets | 4,087 | 3,573 | ' | ' |
Total current assets | 84,685 | 69,648 | ' | ' |
Non-current assets | ' | ' | ' | ' |
Total non-current assets | 21,309 | 20,338 | ' | ' |
Total assets | 105,994 | 89,986 | ' | ' |
Current liabilities | ' | ' | ' | ' |
Accrued expenses and other liabilities | 15,072 | 9,636 | ' | ' |
Total current liabilities | 40,797 | 25,237 | ' | ' |
Total liabilities | 41,474 | 25,369 | ' | ' |
Shareholders' equity | ' | ' | ' | ' |
Ordinary shares (par value of US$0.0001 per share at September 30, 2012 and 2013; Authorized - 480,000,000 shares at September 30, 2012 and 2013; Issued and outstanding - 134,386,849 and 135,532,141 shares at September 30, 2012 and 2013, respectively) | 14 | 13 | ' | ' |
Additional paid-in capital | 46,742 | 61,777 | ' | ' |
Accumulated other comprehensive income | 6,295 | 4,922 | ' | ' |
Retained earnings/(cumulative deficits) | 11,469 | -2,095 | ' | ' |
Total equity | 64,520 | 64,617 | ' | ' |
Total liabilities and equity | 105,994 | 89,986 | ' | ' |
Parent Company | ' | ' | ' | ' |
Current assets | ' | ' | ' | ' |
Cash and cash equivalents | 2,333 | 11,998 | 19,620 | 24,141 |
Prepayment and other current assets | 278 | 293 | ' | ' |
Amount due from subsidiaries | 2,642 | 8,904 | ' | ' |
Total current assets | 5,253 | 21,195 | ' | ' |
Non-current assets | ' | ' | ' | ' |
Investment in subsidiaries | 62,424 | 45,836 | ' | ' |
Total non-current assets | 62,424 | 45,836 | ' | ' |
Total assets | 67,677 | 67,031 | ' | ' |
Current liabilities | ' | ' | ' | ' |
Accrued expenses and other liabilities | 809 | 159 | ' | ' |
Amount due to subsidiaries | 2,348 | 2,255 | ' | ' |
Total current liabilities | 3,157 | 2,414 | ' | ' |
Total liabilities | 3,157 | 2,414 | ' | ' |
Shareholders' equity | ' | ' | ' | ' |
Ordinary shares (par value of US$0.0001 per share at September 30, 2012 and 2013; Authorized - 480,000,000 shares at September 30, 2012 and 2013; Issued and outstanding - 134,386,849 and 135,532,141 shares at September 30, 2012 and 2013, respectively) | 14 | 13 | ' | ' |
Additional paid-in capital | 46,742 | 61,777 | ' | ' |
Accumulated other comprehensive income | 6,295 | 4,922 | ' | ' |
Retained earnings/(cumulative deficits) | 11,469 | -2,095 | ' | ' |
Total equity | 64,520 | 64,617 | 72,734 | 74,986 |
Total liabilities and equity | $67,677 | $67,031 | ' | ' |
Schedule_I_BALANCE_SHEETS_Pare
Schedule I - BALANCE SHEETS (Parenthetical) (Detail) (USD $) | Sep. 30, 2013 | Dec. 07, 2012 | Sep. 30, 2012 | Dec. 15, 2011 | Apr. 18, 2008 |
Condensed Balance Sheet Statements, Captions [Line Items] | ' | ' | ' | ' | ' |
Ordinary shares, par value | $0.00 | ' | $0.00 | ' | $0.00 |
Ordinary shares, Authorized | 480,000,000 | ' | 480,000,000 | ' | ' |
Ordinary shares, Issued | 135,532,141 | ' | 134,386,849 | ' | ' |
Ordinary shares, outstanding | 135,532,141 | 135,409,521 | 134,386,849 | 135,565,361 | ' |
Parent Company | ' | ' | ' | ' | ' |
Condensed Balance Sheet Statements, Captions [Line Items] | ' | ' | ' | ' | ' |
Ordinary shares, par value | $0.00 | ' | $0.00 | ' | ' |
Ordinary shares, Authorized | 480,000,000 | ' | 480,000,000 | ' | ' |
Ordinary shares, Issued | 135,532,141 | ' | 134,386,849 | ' | ' |
Ordinary shares, outstanding | 135,532,141 | ' | 134,386,849 | ' | ' |
Schedule_I_STATEMENTS_OF_OPERA
Schedule I - STATEMENTS OF OPERATIONS (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 |
Condensed Income Statements, Captions [Line Items] | ' | ' | ' |
Cost of revenues | ($27,073) | ($20,494) | ($16,840) |
Selling expenses | -15,673 | -11,337 | -9,771 |
General and administrative expenses | -9,806 | -8,248 | -12,221 |
Operating income (loss) | 16,023 | 9,494 | -574 |
Net income (loss) attributable to China Distance Education Holdings Limited | 13,564 | 8,209 | -3,802 |
Parent Company | ' | ' | ' |
Condensed Income Statements, Captions [Line Items] | ' | ' | ' |
Cost of revenues | -56 | -37 | -1,999 |
Selling expenses | -47 | -16 | -678 |
General and administrative expenses | -1,556 | -1,033 | -4,209 |
Operating income (loss) | -1,659 | -1,086 | -6,886 |
Equity in income of subsidiaries and variable interest entities | 15,215 | 9,124 | 2,819 |
Finance cost | 8 | 171 | 265 |
Net income (loss) attributable to China Distance Education Holdings Limited | $13,564 | $8,209 | ($3,802) |
Schedule_I_STATEMENTS_OF_COMPR
Schedule I - STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 |
Condensed Consolidating Statement of Other Comprehensive Income (Loss) [Line Items] | ' | ' | ' |
Net (loss)/income | $13,564 | $8,209 | ($3,802) |
Other comprehensive income (loss): | ' | ' | ' |
Foreign currency translation adjustment | 1,373 | 701 | 1,855 |
Total comprehensive income | 14,937 | 8,910 | -1,980 |
Parent Company | ' | ' | ' |
Condensed Consolidating Statement of Other Comprehensive Income (Loss) [Line Items] | ' | ' | ' |
Net (loss)/income | 13,564 | 8,209 | -3,802 |
Other comprehensive income (loss): | ' | ' | ' |
Foreign currency translation adjustment | 1,373 | 701 | 1,822 |
Total comprehensive income | $14,937 | $8,910 | $1,980 |
Schedule_I_Statement_of_Change
Schedule I - Statement of Changes in Equity (Detail) (USD $) | 0 Months Ended | 12 Months Ended | |||
Nov. 13, 2012 | Nov. 16, 2011 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 | |
Condensed Financial Statements, Captions [Line Items] | ' | ' | ' | ' | ' |
Beginning Balance | ' | ' | $64,617,000 | ' | ' |
Net income (loss) for the year | ' | ' | 13,564,000 | 8,209,000 | -3,802,000 |
Foreign currency translation adjustments | ' | ' | 1,373,000 | 701,000 | 1,855,000 |
Repurchase of ordinary shares | ' | ' | -93,000 | -993,000 | -8,138,000 |
Options exercised (in shares) | ' | ' | 964,092 | ' | ' |
Options exercised | ' | ' | 603,000 | 3,981,000 | 75,000 |
Stock-based compensation expense (Note 23) | ' | ' | 625,000 | 141,000 | 6,024,000 |
Dividends (Note 24) | -16,056,000 | -16,268,000 | -16,056,000 | -16,268,000 | ' |
Loan to optionees in connection with exercise of options | ' | ' | -113,000 | -3,888,000 | ' |
Ending Balance | ' | ' | 64,520,000 | 64,617,000 | ' |
Ordinary shares | ' | ' | ' | ' | ' |
Condensed Financial Statements, Captions [Line Items] | ' | ' | ' | ' | ' |
Beginning Balance (in shares) | ' | ' | 134,386,849 | 127,800,673 | 136,932,849 |
Repurchase of ordinary shares (in shares) | ' | ' | -67,100 | -1,285,464 | -9,223,188 |
Repurchase of ordinary shares | ' | ' | ' | ' | -1,000 |
Options exercised (in shares) | ' | ' | 987,392 | 7,871,640 | 91,012 |
Options exercised | ' | ' | 1,000 | ' | ' |
Ending Balance (in shares) | ' | ' | 135,532,141 | 134,386,849 | 127,800,673 |
Additional Paid-in Capital | ' | ' | ' | ' | ' |
Condensed Financial Statements, Captions [Line Items] | ' | ' | ' | ' | ' |
Repurchase of ordinary shares | ' | ' | -93,000 | -993,000 | -8,137,000 |
Options exercised | ' | ' | 602,000 | 3,981,000 | 75,000 |
Stock-based compensation expense (Note 23) | ' | ' | 625,000 | 141,000 | 6,024,000 |
Dividends (Note 24) | ' | ' | -16,056,000 | -16,268,000 | ' |
Loan to optionees in connection with exercise of options | ' | ' | -113,000 | -3,888,000 | ' |
Additional Paid-in Capital | Start-up training business | ' | ' | ' | ' | ' |
Condensed Financial Statements, Captions [Line Items] | ' | ' | ' | ' | ' |
Acquisition of noncontrolling interest | ' | ' | ' | ' | 911,000 |
Additional Paid-in Capital | Gaokao re-take business | ' | ' | ' | ' | ' |
Condensed Financial Statements, Captions [Line Items] | ' | ' | ' | ' | ' |
Acquisition of noncontrolling interest | ' | ' | ' | ' | 856,000 |
Accumulated other comprehensive income | ' | ' | ' | ' | ' |
Condensed Financial Statements, Captions [Line Items] | ' | ' | ' | ' | ' |
Foreign currency translation adjustments | ' | ' | 1,373,000 | 701,000 | 1,822,000 |
Parent Company | ' | ' | ' | ' | ' |
Condensed Financial Statements, Captions [Line Items] | ' | ' | ' | ' | ' |
Beginning Balance | ' | ' | 64,617,000 | 72,734,000 | 74,986,000 |
Net income (loss) for the year | ' | ' | 13,564,000 | 8,209,000 | -3,802,000 |
Foreign currency translation adjustments | ' | ' | 1,373,000 | 701,000 | 1,822,000 |
Repurchase of ordinary shares | ' | ' | -93,000 | -993,000 | -8,138,000 |
Options exercised | ' | ' | 603,000 | 3,981,000 | 75,000 |
Stock-based compensation expense (Note 23) | ' | ' | 625,000 | 141,000 | 6,024,000 |
Dividends (Note 24) | ' | ' | -16,056,000 | -16,268,000 | ' |
Loan to optionees in connection with exercise of options | ' | ' | -113,000 | -3,888,000 | ' |
Ending Balance | ' | ' | 64,520,000 | 64,617,000 | 72,734,000 |
Parent Company | Start-up training business | ' | ' | ' | ' | ' |
Condensed Financial Statements, Captions [Line Items] | ' | ' | ' | ' | ' |
Acquisition of noncontrolling interest | ' | ' | ' | ' | 911,000 |
Parent Company | Gaokao re-take business | ' | ' | ' | ' | ' |
Condensed Financial Statements, Captions [Line Items] | ' | ' | ' | ' | ' |
Acquisition of noncontrolling interest | ' | ' | ' | ' | 856,000 |
Parent Company | Ordinary shares | ' | ' | ' | ' | ' |
Condensed Financial Statements, Captions [Line Items] | ' | ' | ' | ' | ' |
Beginning Balance | ' | ' | 13,000 | 13,000 | 14,000 |
Beginning Balance (in shares) | ' | ' | 134,386,849 | 127,800,673 | 136,932,849 |
Repurchase of ordinary shares (in shares) | ' | ' | -67,100 | -1,285,464 | -9,223,188 |
Repurchase of ordinary shares | ' | ' | ' | ' | -1,000 |
Options exercised (in shares) | ' | ' | 987,392 | 7,871,640 | 91,012 |
Options exercised | ' | ' | 1,000 | ' | ' |
Stock-based compensation expense (Note 23) | ' | ' | 225,000 | ' | ' |
Ending Balance | ' | ' | 14,000 | 13,000 | 13,000 |
Ending Balance (in shares) | ' | ' | 135,532,141 | 134,386,849 | 127,800,673 |
Parent Company | Additional Paid-in Capital | ' | ' | ' | ' | ' |
Condensed Financial Statements, Captions [Line Items] | ' | ' | ' | ' | ' |
Beginning Balance | ' | ' | 61,777,000 | 78,804,000 | 79,075,000 |
Repurchase of ordinary shares | ' | ' | -93,000 | -993,000 | -8,137,000 |
Options exercised | ' | ' | 602,000 | 3,981,000 | 75,000 |
Stock-based compensation expense (Note 23) | ' | ' | 625,000 | 141,000 | 6,024,000 |
Dividends (Note 24) | ' | ' | -16,056,000 | -16,268,000 | ' |
Loan to optionees in connection with exercise of options | ' | ' | -113,000 | -3,888,000 | ' |
Ending Balance | ' | ' | 46,472,000 | 61,777,000 | 78,804,000 |
Parent Company | Additional Paid-in Capital | Start-up training business | ' | ' | ' | ' | ' |
Condensed Financial Statements, Captions [Line Items] | ' | ' | ' | ' | ' |
Acquisition of noncontrolling interest | ' | ' | ' | ' | 911,000 |
Parent Company | Additional Paid-in Capital | Gaokao re-take business | ' | ' | ' | ' | ' |
Condensed Financial Statements, Captions [Line Items] | ' | ' | ' | ' | ' |
Acquisition of noncontrolling interest | ' | ' | ' | ' | 856,000 |
Parent Company | Accumulated other comprehensive income | ' | ' | ' | ' | ' |
Condensed Financial Statements, Captions [Line Items] | ' | ' | ' | ' | ' |
Beginning Balance | ' | ' | 4,922,000 | 4,221,000 | 2,399,000 |
Foreign currency translation adjustments | ' | ' | 1,373,000 | 701,000 | 1,822,000 |
Ending Balance | ' | ' | 6,295,000 | 4,922,000 | 4,221,000 |
Parent Company | Retained earnings/ (Cumulative deficits) | ' | ' | ' | ' | ' |
Condensed Financial Statements, Captions [Line Items] | ' | ' | ' | ' | ' |
Beginning Balance | ' | ' | -2,095,000 | -10,304,000 | -6,502,000 |
Net income (loss) for the year | ' | ' | 13,564,000 | 8,209,000 | -3,802,000 |
Ending Balance | ' | ' | $11,469,000 | ($2,095,000) | ($10,304,000) |
Schedule_I_Statements_of_Cash_
Schedule I - Statements of Cash Flows (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 |
CASH FLOWS FROM OPERATING ACTIVITIES | ' | ' | ' |
Net (loss) income | $13,564 | $8,209 | ($3,802) |
Adjustments to reconcile net income to net cash used in operating activities: | ' | ' | ' |
Share-based compensation | 625 | 141 | 6,024 |
Increase in accrued expenses and other liabilities | 5,132 | 2,827 | 1,111 |
Increase (decrease) in prepayments and other assets | -420 | -679 | -1,054 |
Net cash generated from operating activities | 32,138 | 15,063 | 9,192 |
Repurchase of ordinary shares | -93 | -993 | -8,138 |
Proceeds from share options exercised by employees | 603 | 3,981 | 75 |
Loan to optionees in connection with exercise of options | -408 | -3,888 | ' |
Repayment of loan to optionees in connection with exercise of options | 295 | ' | ' |
Dividends paid to shareholders | -16,056 | -16,268 | ' |
Net cash used in financing activities | -15,659 | -17,168 | -8,063 |
Net increase (decrease) in cash and cash equivalents | 22,196 | -1,224 | -7,808 |
Cash and cash equivalents at beginning of the year | 49,723 | ' | ' |
Parent Company | ' | ' | ' |
CASH FLOWS FROM OPERATING ACTIVITIES | ' | ' | ' |
Net (loss) income | 13,564 | 8,209 | -3,802 |
Adjustments to reconcile net income to net cash used in operating activities: | ' | ' | ' |
Equity in profit of subsidiaries and variable interest entities | -15,215 | -9,124 | -2,819 |
Share-based compensation | 625 | 141 | 6,024 |
Increase in accrued expenses and other liabilities | 650 | 22 | 47 |
Decrease in amounts due from subsidiaries | 6,262 | 10,318 | 4,033 |
Increase (decrease) in prepayments and other assets | 15 | -36 | 56 |
Increase in amounts due to a subsidiary | 93 | 16 | 3 |
Net cash generated from operating activities | 5,994 | 9,546 | 3,542 |
Repurchase of ordinary shares | -93 | -993 | -8,138 |
Proceeds from share options exercised by employees | 603 | 3,981 | 75 |
Loan to optionees in connection with exercise of options | -408 | -3,888 | ' |
Repayment of loan to optionees in connection with exercise of options | 295 | ' | ' |
Dividends paid to shareholders | -16,056 | -16,268 | ' |
Net cash used in financing activities | -15,659 | -17,168 | -8,063 |
Net increase (decrease) in cash and cash equivalents | -9,665 | -7,622 | -4,521 |
Cash and cash equivalents at beginning of the year | 11,998 | 19,620 | 24,141 |
Cash and cash equivalents and end of the year | $2,333 | $11,998 | $19,620 |
Schedule_I_Basis_for_Preparati
Schedule I - Basis for Preparation (Detail) (Parent Company) | Sep. 30, 2013 |
Parent Company | ' |
Condensed Financial Statements, Captions [Line Items] | ' |
Subsidiaries, VIE and VIE's subsidiaries consolidated net assets percentage | 25.00% |
Schedule_I_Investments_in_Subs
Schedule I - Investments in Subsidiaries and VIES (Detail) (Parent Company, USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 |
Parent Company | ' | ' | ' |
Condensed Financial Statements, Captions [Line Items] | ' | ' | ' |
Investments in subsidiaries and VIEs | $62,424 | $45,836 | ' |
Equity in income of subsidiaries and variable interest entities | $15,215 | $9,124 | $2,819 |