Document_and_Entity_Informatio
Document and Entity Information | 12 Months Ended |
Dec. 31, 2013 | |
Document and Entity Information | ' |
Entity Registrant Name | 'Pactera Technology International Ltd. |
Entity Central Index Key | '0001493639 |
Document Type | '20-F |
Document Period End Date | 31-Dec-13 |
Amendment Flag | 'false |
Current Fiscal Year End Date | '--12-31 |
Entity Well-known Seasoned Issuer | 'No |
Entity Voluntary Filers | 'No |
Entity Current Reporting Status | 'Yes |
Entity Filer Category | 'Accelerated Filer |
Entity Common Stock, Shares Outstanding | 87,166,647 |
Document Fiscal Year Focus | '2013 |
Document Fiscal Period Focus | 'FY |
CONSOLIDATED_BALANCE_SHEETS
CONSOLIDATED BALANCE SHEETS (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Current assets: | ' | ' |
Cash and cash equivalents | $148,518 | $143,714 |
Restricted cash | 1,067 | 6,112 |
Term deposits | 41,724 | 58,485 |
Short-term investment | ' | 1,765 |
Accounts receivable, net of allowance for doubtful accounts of $16,386 and $13,646 as of December 31, 2012 and 2013, respectively | 246,450 | 230,693 |
Prepaid expenses and other current assets | 18,662 | 28,495 |
Assets held for sale | 2,589 | ' |
Deferred tax assets - current | 7,786 | 8,940 |
Total current assets | 466,796 | 478,204 |
Equity method investment | 318 | 250 |
Property, plant and equipment, net | 95,831 | 67,607 |
Land use right | 24,544 | 24,378 |
Intangible assets, net | 44,612 | 55,303 |
Goodwill | 102,222 | 102,659 |
Other assets | 5,190 | 5,912 |
Deferred tax assets - non-current | 5,364 | 3,293 |
TOTAL ASSETS | 744,877 | 737,606 |
Current liabilities: | ' | ' |
Accounts payable | 3,750 | 3,117 |
Accrued expenses and other payables | 121,758 | 103,044 |
Contingent acquisition consideration payable - current | 23,456 | 31,519 |
Income taxes payable | 16,373 | 13,530 |
Other taxes payable | 14,462 | 11,531 |
Deferred tax liability - current | 352 | 411 |
Total current liabilities | 180,151 | 163,152 |
Contingent acquisition consideration payable - non-current | 4,039 | 19,900 |
Unrecognized tax benefits - non-current | 969 | 969 |
Deferred tax liability - non-current | 9,445 | 11,261 |
TOTAL LIABILITIES | 194,604 | 195,282 |
Commitments and contingencies (Note 21) | ' | ' |
Pactera Technology International Ltd. shareholders' equity: | ' | ' |
Common shares ($0.00139482 par value; 120,000,000 shares authorized; 88,312,068 and 85,503,321 shares issued and outstanding as of December 31, 2012 and 2013, respectively) | 119 | 123 |
Additional paid-in capital | 497,391 | 502,748 |
Share issuable in connection with business acquisition | 2,503 | 1,537 |
Statutory reserve | 19,765 | 16,900 |
Retained earnings | 5,869 | 897 |
Accumulated other comprehensive income | 24,626 | 18,780 |
Total Pactera Technology International Ltd. shareholders' equity | 550,273 | 540,985 |
Non-controlling interest | ' | 1,339 |
Total equity | 550,273 | 542,324 |
TOTAL LIABILITIES AND EQUITY | $744,877 | $737,606 |
CONSOLIDATED_BALANCE_SHEETS_Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 |
In Thousands, except Share data, unless otherwise specified | ||||
CONSOLIDATED BALANCE SHEETS | ' | ' | ' | ' |
Accounts receivable, allowance for doubtful accounts | $13,646 | $16,386 | $4,002 | $3,698 |
Common shares, par value (in dollars per share) | $0.00 | $0.00 | ' | ' |
Common shares, authorized (in shares) | 120,000,000 | 120,000,000 | ' | ' |
Common shares, issued (in shares) | 85,503,321 | 88,312,068 | ' | ' |
Common shares, outstanding (in shares) | 85,503,321 | 88,312,068 | ' | ' |
CONSOLIDATED_STATEMENTS_OF_OPE
CONSOLIDATED STATEMENTS OF OPERATIONS (USD $) | 12 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
CONSOLIDATED STATEMENTS OF OPERATIONS | ' | ' | ' |
Revenues | $672,873 | $358,642 | $223,095 |
(Business tax)/business tax refund | -2,854 | 389 | -4,106 |
Net revenues | 670,019 | 359,031 | 218,989 |
Cost of revenues | 476,496 | 234,602 | 142,427 |
Gross profit | 193,523 | 124,429 | 76,562 |
Operating expenses | ' | ' | ' |
General and administrative | 136,863 | 89,875 | 38,533 |
Selling and marketing | 46,706 | 27,741 | 16,924 |
Impairment of trademarks and trade names | ' | 5,515 | ' |
Impairment of assets held for sale | 266 | ' | ' |
Change in fair value of contingent consideration | -1,164 | -659 | 1,824 |
Total operating expenses | 182,671 | 122,472 | 57,281 |
Income from operations | 10,852 | 1,957 | 19,281 |
Other income | ' | ' | ' |
Interest expense | -27 | -70 | -102 |
Interest income | 2,220 | 3,685 | 2,979 |
Exchange losses | -616 | -1,042 | -2,070 |
Gain on disposal of variable interest entity | 305 | ' | ' |
Change in fair value of foreign currency forward contract | 3 | -18 | 28 |
Total other income | 1,885 | 2,555 | 835 |
Income before income tax expense and earnings in equity method investment | 12,737 | 4,512 | 20,116 |
Income tax expense | -4,968 | -1,210 | -1,718 |
Income before earnings in equity method investment | 7,769 | 3,302 | 18,398 |
Earnings in equity method investment | 68 | 23 | ' |
Net income | 7,837 | 3,325 | 18,398 |
Net income attributable to non-controlling interest | ' | -735 | -497 |
Net income attributable to Pactera Technology International Ltd. | $7,837 | $2,590 | $17,901 |
Net income per share attributable to Pactera Technology International Ltd. shareholders | ' | ' | ' |
Basic (in dollars per share) | $0.10 | $0.05 | $0.44 |
Diluted (in dollars per share) | $0.09 | $0.05 | $0.42 |
Weighted average shares used in calculating net income per share | ' | ' | ' |
Basic (in shares) | 81,942,795 | 47,547,307 | 40,596,429 |
Diluted (in shares) | 84,953,046 | 49,444,160 | 42,956,291 |
CONSOLIDATED_STATEMENTS_OF_COM
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | ' | ' | ' |
Net income | $7,837 | $3,325 | $18,398 |
Other comprehensive income, net of tax: | ' | ' | ' |
Change in cumulative foreign currency translation adjustment | 5,846 | 2,460 | 5,738 |
Comprehensive income | 13,683 | 5,785 | 24,136 |
Less: Comprehensive income attributable to non-controlling interest | ' | -742 | -497 |
Comprehensive income attributable to Pactera Technology International Ltd. | $13,683 | $5,043 | $23,639 |
CONSOLIDATED_STATEMENTS_OF_CHA
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (USD $) | Total | Pactera Technology International Limited shareholders | Common shares | Treasury stock | Additional paid-in capital | Shares to be issued in connection with business acquisition | Statutory reserve | (Accumulated deficit) Retained earnings | Accumulated other comprehensive income | Non-controlling interest |
In Thousands, except Share data, unless otherwise specified | ||||||||||
Balance at Dec. 31, 2010 | $174,952 | $174,952 | $58 | ' | $176,517 | ' | $3,778 | ($15,990) | $10,589 | ' |
Balance (in shares) at Dec. 31, 2010 | ' | ' | 41,536,412 | ' | ' | ' | ' | ' | ' | ' |
Increase (Decrease) in Stockholders' Equity | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Repurchase of common shares (in shares) | ' | ' | -2 | ' | ' | ' | ' | ' | ' | ' |
Issuance of common shares for share-based compensation | 2 | 2 | 2 | ' | ' | ' | ' | ' | ' | ' |
Issuance of common shares for share-based compensation (in shares) | ' | ' | 1,075,406 | ' | ' | ' | ' | ' | ' | ' |
Capital contribution from non-controlling interest | 909 | ' | ' | ' | ' | ' | ' | ' | ' | 909 |
Stock option exercise | 4,235 | 4,235 | ' | ' | 4,235 | ' | ' | ' | ' | ' |
Share-based compensation | 5,656 | 5,656 | ' | ' | 5,656 | ' | ' | ' | ' | ' |
Vesting of nonvested shares award (in shares) | ' | ' | 108,251 | ' | ' | ' | ' | ' | ' | ' |
Provision for statutory reserve | ' | ' | ' | ' | ' | ' | 2,875 | -2,875 | ' | ' |
Net income | 18,398 | 17,901 | ' | ' | ' | ' | ' | 17,901 | ' | 497 |
Foreign currency translation adjustments | 5,738 | 5,738 | ' | ' | ' | ' | ' | ' | 5,738 | ' |
Balance at Dec. 31, 2011 | 209,890 | 208,484 | 60 | ' | 186,408 | ' | 6,653 | -964 | 16,327 | 1,406 |
Balance (in shares) at Dec. 31, 2011 | ' | ' | 42,720,067 | ' | ' | ' | ' | ' | ' | ' |
Increase (Decrease) in Stockholders' Equity | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Repurchase of common shares (in shares) | ' | ' | -1 | ' | ' | ' | ' | ' | ' | ' |
Issuance of common shares for share-based compensation | 14 | 14 | 3 | ' | 11 | ' | ' | ' | ' | ' |
Issuance of common shares for share-based compensation (in shares) | ' | ' | 2,150,814 | ' | ' | ' | ' | ' | ' | ' |
Issuance of common share for business acquisition | 326,778 | 326,778 | 60 | ' | 326,718 | ' | ' | ' | ' | ' |
Issuance of common share for business acquisition (in shares) | ' | ' | 43,441,188 | ' | ' | ' | ' | ' | ' | ' |
Balance brought forward from VanceInfo as a result of the merger | ' | -1,270 | ' | ' | -11,407 | 619 | 9,518 | ' | ' | 1,270 |
Stock option exercise | 1,933 | 1,933 | ' | ' | 1,933 | ' | ' | ' | ' | ' |
Share-based compensation | 11,125 | 11,125 | ' | ' | 11,125 | ' | ' | ' | ' | ' |
Dividend distribution | -1,181 | ' | ' | ' | ' | ' | ' | ' | ' | -1,181 |
Acquisition of non-controlling interest | -12,938 | -12,040 | ' | ' | -12,040 | ' | ' | ' | ' | -898 |
Shares issuable in connection with business acquisition | 918 | 918 | ' | ' | ' | 918 | ' | ' | ' | ' |
Provision for statutory reserve | ' | ' | ' | ' | ' | ' | 729 | -729 | ' | ' |
Net income | 3,325 | 2,590 | ' | ' | ' | ' | ' | 2,590 | ' | 735 |
Foreign currency translation adjustments | 2,460 | 2,453 | ' | ' | ' | ' | ' | ' | 2,453 | 7 |
Balance at Dec. 31, 2012 | 542,324 | 540,985 | 123 | ' | 502,748 | 1,537 | 16,900 | 897 | 18,780 | 1,339 |
Balance (in shares) at Dec. 31, 2012 | 88,312,068 | ' | 88,312,068 | ' | ' | ' | ' | ' | ' | ' |
Increase (Decrease) in Stockholders' Equity | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Repurchase of common shares | -30,000 | -30,000 | ' | -29,907 | -93 | ' | ' | ' | ' | ' |
Repurchase of common shares (in shares) | ' | ' | -4,643,359 | ' | ' | ' | ' | ' | ' | ' |
Cancellation of common shares and treasury stock | ' | ' | -4 | 18,678 | -18,674 | ' | ' | ' | ' | ' |
Cancellation of common shares and treasury stock (in shares) | ' | ' | -379,278 | ' | ' | ' | ' | ' | ' | ' |
Reissuance of treasury stock for share based compensation | ' | ' | ' | 11,229 | -11,229 | ' | ' | ' | ' | ' |
Reissuance of treasury stock for share based compensation (in shares) | ' | ' | 1,743,359 | ' | ' | ' | ' | ' | ' | ' |
Issuance of common share for business acquisition | ' | ' | ' | ' | 2,464 | -2,464 | ' | ' | ' | ' |
Issuance of common share for business acquisition (in shares) | ' | ' | 319,556 | ' | ' | ' | ' | ' | ' | ' |
Disposal of variable interest entity | -71 | -71 | ' | ' | -71 | ' | ' | ' | ' | ' |
Stock option exercise | 4,201 | 4,201 | ' | ' | 4,201 | ' | ' | ' | ' | ' |
Share-based compensation | 23,000 | 23,000 | ' | ' | 23,000 | ' | ' | ' | ' | ' |
Vesting of nonvested shares award (in shares) | ' | ' | 150,975 | ' | ' | ' | ' | ' | ' | ' |
Vesting of nonvested shares of a subsidiary | ' | -1,363 | ' | ' | -1,363 | ' | ' | ' | ' | 1,363 |
Acquisition of non-controlling interest | -6,294 | -3,592 | ' | ' | -3,592 | ' | ' | ' | ' | -2,702 |
Shares issuable in connection with business acquisition | 3,430 | 3,430 | ' | ' | ' | 3,430 | ' | ' | ' | ' |
Provision for statutory reserve | ' | ' | ' | ' | ' | ' | 2,865 | -2,865 | ' | ' |
Net income | 7,837 | 7,837 | ' | ' | ' | ' | ' | 7,837 | ' | ' |
Foreign currency translation adjustments | 5,846 | 5,846 | ' | ' | ' | ' | ' | ' | 5,846 | ' |
Balance at Dec. 31, 2013 | $550,273 | $550,273 | $119 | ' | $497,391 | $2,503 | $19,765 | $5,869 | $24,626 | ' |
Balance (in shares) at Dec. 31, 2013 | 85,503,321 | ' | 85,503,321 | ' | ' | ' | ' | ' | ' | ' |
CONSOLIDATED_STATEMENTS_OF_CAS
CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Cash flows from operating activities: | ' | ' | ' |
Net income | $7,837 | $3,325 | $18,398 |
Adjustments to reconcile net income to net cash provided by operating activities: | ' | ' | ' |
Allowance for doubtful accounts | 343 | 5,153 | 477 |
Loss on disposals of property, plant and equipment | 4,788 | 103 | 37 |
Depreciation | 13,670 | 6,850 | 4,400 |
Change in fair value of foreign currency forward contract | -3 | 18 | -28 |
Amortization of intangible assets | 10,434 | 6,058 | 2,677 |
Amortization of land use right | 509 | 71 | ' |
Impairment of trademarks and trade names | ' | 5,515 | ' |
Impairment of assets held for sale | 266 | ' | ' |
Gains on disposal of variable interest entity | -305 | ' | ' |
Earnings in equity method investment | -68 | -23 | ' |
Non-cash interest income | ' | ' | -34 |
Share-based compensation expenses | 22,858 | 11,064 | 5,656 |
Change in fair value of contingent consideration | -1,164 | -659 | 1,824 |
Changes in operating assets and liabilities, net of effects of business acquisitions: | ' | ' | ' |
Accounts receivable | -12,635 | -12,278 | -12,405 |
Prepaid expenses and other current assets | -3,085 | -1,374 | -2,565 |
Other assets | 495 | -697 | 2,170 |
Accounts payable | 2,742 | -3,459 | 216 |
Accrued merger related cost | -8,405 | 8,465 | ' |
Accrued privatization related cost | 5,514 | ' | ' |
Accrued expenses and other payables | 13,143 | 8,723 | 3,185 |
Income taxes payable | 3,659 | 1,615 | 390 |
Other taxes payable | 2,856 | 2,636 | 394 |
Deferred taxes | -2,617 | -4,781 | -469 |
Net cash provided by operating activities | 60,832 | 36,325 | 24,323 |
Cash flows from investing activities: | ' | ' | ' |
Purchase of term deposits | ' | -1,908 | -75,283 |
Maturity of term deposits | 16,762 | ' | 53,602 |
Purchase of short-term investment | ' | -1,764 | ' |
Maturity of short-term investment | 1,765 | ' | ' |
Purchase of property, plant and equipment | -9,414 | -5,600 | -7,691 |
Purchase of building and property | -18,298 | -15,633 | ' |
Payment of success fee related to business acquisition | ' | ' | -450 |
(Increase) decrease in restricted cash | 5,048 | -3,022 | -836 |
Payments for business acquisitions (net of cash acquired of $457, $1,482 and nil in 2011, 2012 and 2013, respectively) | -3,921 | -9,554 | -7,716 |
Cash received from merger with VanceInfo | ' | 31,717 | ' |
Net cash used in investing activities | -8,058 | -5,764 | -38,374 |
Cash flows from financing activities: | ' | ' | ' |
Repayment of short-term bank borrowings | ' | -477 | -40,000 |
Proceeds from issuance of common shares for share based compensation | 4,414 | 1,988 | 5,291 |
Capital contribution from non-controlling interest | ' | ' | 909 |
Deferred and contingent consideration paid for business acquisitions | -22,661 | -3,047 | -11,710 |
Payment of principal amount under capital lease obligations | ' | ' | -136 |
Repurchase of common shares | -30,000 | ' | ' |
Net cash used in financing activities | -48,247 | -1,536 | -45,646 |
Effect of exchange rate changes | 277 | 833 | 3,660 |
Net (decrease) increase in cash and cash equivalents | 4,804 | 29,858 | -56,037 |
Cash and cash equivalents at beginning of year | 143,714 | 113,856 | 169,893 |
Cash and cash equivalents at end of year | 148,518 | 143,714 | 113,856 |
Supplemental information on non-cash investing and financing activities: | ' | ' | ' |
Shares issuance for business acquisition | 2,464 | 326,778 | ' |
Payable for business acquisition | 27,495 | 51,419 | 18,552 |
Payable for construction of building | 5,120 | ' | ' |
Dividend distribution | ' | 1,181 | ' |
Supplemental cash flow information: | ' | ' | ' |
Interest paid | ' | ' | 69 |
Income taxes paid | $4,742 | $4,278 | $1,458 |
CONSOLIDATED_STATEMENTS_OF_CAS1
CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
CONSOLIDATED STATEMENTS OF CASH FLOWS | ' | ' | ' |
Cash acquired from business acquisition | ' | $1,482 | $457 |
ORGANIZATION_AND_PRINCIPAL_ACT
ORGANIZATION AND PRINCIPAL ACTIVITIES | 12 Months Ended | |||||||||
Dec. 31, 2013 | ||||||||||
ORGANIZATION AND PRINCIPAL ACTIVITIES | ' | |||||||||
ORGANIZATION AND PRINCIPAL ACTIVITIES | ' | |||||||||
1. ORGANIZATION AND PRINCIPAL ACTIVITIES | ||||||||||
Pactera Technology International Ltd. ("Pactera International" or the "Company", formerly known as Hisoft Technology International Limited) was incorporated in the Cayman Islands on May 27, 2004 as the holding company for a group of companies. Pactera International and its subsidiaries (collectively the "Group") provide outsourced information technology services primarily in the People's Republic of China (the "PRC"), Hong Kong, the United States of America ("U.S."), Asia South, Europe, and Japan. | ||||||||||
On November 9, 2012, in connection with the completion of the merger of equals with VanceInfo Technologies Inc. ("VanceInfo"), a listed company on NYSE providing outsourced information technology services, the Company changed its name to "Pactera Technology International Ltd.". VanceInfo was delisted from NYSE immediately after the merger with the Group. According to the merger agreement dated August 10, 2012 ("Merger Agreement"), the Company and the shareholders of VanceInfo each owned approximately 50% of the combined company. Each outstanding common share of VanceInfo was exchanged for the right to receive one common share of the Company and each American Depositary Share ("ADS") of VanceInfo, each of which represents one common share, was exchanged for the right to receive one ADS of the Company. | ||||||||||
Immediately prior to the merger of equals, the Company effected a 13.9482 to 1 common share consolidation and changed the ratio of the Company's ADSs representing common share from one ADS for nineteen common shares to one ADS for one common share. As a result, the shares data and the basic and diluted net income per share were adjusted retroactively for all periods presented. | ||||||||||
The VIE arrangement | ||||||||||
In July 2004, Pactera International entered into a series of contractual arrangements with the Group's VIE, Hisoft Technology (Dalian) Co., Ltd. ("Hisoft Dalian") in Dalian, PRC. The contractual agreements provide the Group with the power to direct the activities that most significantly affects the economic performance of the Hisoft Dalian and enable the Group to receive the substantial economic benefits of the Hisoft Dalian. Such contractual agreements enable us to (1) receive substantially all of the economic benefit from Hisoft Dalian; (2) have an exclusive option to purchase all or part of the equity interest in Hisoft Dalian at a nominal price or the minimum price permitted under applicable laws; and (3) have the power to direct the activities that most significantly affect the economic performance of Hisoft Dalian. | ||||||||||
The business operation and revenue of Hisoft Dalian were minimal in year 2011 and 2012 and the assets and liabilities are insignificant. The revenue of Hisoft Dalian in year 2011 and 2012 was nil and nil. Its total assets and total liabilities as of December 31, 2012 were $312 and $642, respectively. | ||||||||||
The Company terminated the above-mentioned contractual agreements in July 2013, thus the Group neither has power to direct the activities that most significantly affects the economic performance of Hisoft Dalian nor receives the substantial economic benefits of Hisoft Dalian. Thereafter, Hisoft Dalian does not constitute a VIE of the Group, and a gain on disposal of Hisoft Dalian of $305 was recognized for the year ended December 31, 2013. | ||||||||||
As of December 31, 2013, the Company's subsidiaries are as follows: | ||||||||||
Subsidiaries | ||||||||||
Subsidiaries | Later of date of | Place of | Percentage of | |||||||
incorporation | incorporation | legal ownership | ||||||||
or acquisition | ||||||||||
Pactera Technology Japan Co., Ltd. ("Pactera Japan") | August 1, 2002 | Japan | 100 | % | ||||||
DMK International, Inc. ("DMK International") | September 4, 2003 | U.S. | 100 | % | ||||||
Dalian Pactera Technology Limited ("Pactera Dalian") (formerly known as HiSoft Technology (Dalian) Co., Ltd.) | July 27, 2004 | PRC | 100 | % | ||||||
Pactera Systems (Hong Kong) Limited ("Pactera Systems Hong Kong") | October 12, 2005 | Hong Kong | 100 | % | ||||||
Shenzhen Pactera Systems Limited ("Pactera Shenzhen Systems") | November 9, 2005 | PRC | 100 | % | ||||||
HiSoft Services (Beijing) Limited ("HiSoft Beijing") | November 10, 2005 | PRC | 100 | % | ||||||
Pactera Technologies NA, Inc. ("Pactera NA") | December 31, 2006 | U.S. | 100 | % | ||||||
Chengdu Pactera Technology Limited ("Pactera Chengdu") (formerly known as HiSoft Technology (Chengdu) Co., Ltd.) | April 4, 2007 | PRC | 100 | % | ||||||
Pactera Singapore Pte. Ltd. ("Pactera Singapore") (formerly known as Hisoft Technology (Singapore) Pte Ltd.) | December 1, 2007 | Singapore | 100 | % | ||||||
Wuxi Pactera Technology Limited ("Pactera Wuxi") (formerly known as Wuxi HiSoft Services Limited) | January 8, 2009 | PRC | 100 | % | ||||||
AllianceSPEC Pte. Ltd. ("AllianceSPEC") | December 1, 2009 | Singapore | 100 | % | ||||||
Wuxi Pactera Technology Training Limited ("Wuxi Training Center") (formerly known as Wuxi Hisoft Technology Training Co,. Ltd.) | December 25, 2009 | PRC | 100 | % | ||||||
Beijing Horizon Information & Technology Co., Ltd. ("Horizon Information") | February 1, 2010 | PRC | 100 | % | ||||||
Insurance Systems Laboratory Co., Ltd. ("ISL") | July 1, 2010 | Japan | 100 | % | ||||||
Beijing Pactera Jinxin Technology Limited ("Pactera Jinxin") (formerly known as HiSoft Jinxin Technology (Beijing) Co., Ltd.) | January 26, 2011 | PRC | 100 | % | ||||||
NouvEON Technology Partners, Inc. ("NouvEON") | July 1, 2011 | U.S. | 100 | % | ||||||
Shanghai HURO Digital Technology Co., Ltd. ("HURO") | October 1, 2011 | PRC | 100 | % | ||||||
Pactera Holdings Spain, S.L. (formerly known as Logoscript International S.L.) and its subsidiaries ("Pactera Spain") | February 1, 2012 | Spain | 100 | % | ||||||
Beijing Pactera Glorycube Technology Limited ("Glory") (formerly known as Beijing GloryCube Technology Co., Ltd.) | June 1, 2012 | PRC | 100 | % | ||||||
Bearing Point Holdings Pty. Limited and its subsidiaries ("Bearing Point") | July 1, 2012 | Australia | 100 | % | ||||||
Shenzhen Pactera Information Limited ("Pactera Shenzhen Information") (formerly known as HiSoft Technology (Shenzhen) Co., Ltd. | May 11, 2012 | PRC | 100 | % | ||||||
VanceInfo Technologies Inc. ("VanceInfo") | November 9, 2012 | Cayman Islands | 100 | % | ||||||
Pactera Technology Limited ("Pactera Beijing") (formerly known as VanceInfo Creative Software Technology Limited) | November 9, 2012 | PRC | 100 | % | ||||||
Pactera Technology Limited ("Pactera BVI") | November 9, 2012 | BVI | 100 | % | ||||||
Pactera Technologies Inc. ("Pactera US") | November 9, 2012 | U.S. | 100 | % | ||||||
Pactera (Hong Kong) Limited ("Pactera Hong Kong") | November 9, 2012 | Hong Kong | 100 | % | ||||||
Shanghai Pactera Technology Limited ("Pactera Shanghai Technology") (formerly known as Shanghai VanceInfo Technologies Limited) | November 9, 2012 | PRC | 100 | % | ||||||
VanceInfo Technologies Limited ("VanceInfo Tianjin") | November 9, 2012 | PRC | 100 | % | ||||||
Shanghai Pactera Software Technology Limited ("Pactera Shanghai") (formerly known as Shanghai VanceInfo Creative Software Technology Limited) | November 9, 2012 | PRC | 100 | % | ||||||
Pactera Malaysia Inc. Sdn. Bhd. ("Pactera Malaysia") | November 9, 2012 | Malaysia | 100 | % | ||||||
Shenzhen Pactera Technology Limited ("Pactera Shenzhen") (formerly known as Shenzhen VanceInfo Creative Software Technology Limited) | November 9, 2012 | PRC | 100 | % | ||||||
Nanjing Pactera Technology Limited ("Pactera Nanjing") (formerly known as Nanjing VanceInfo Creative Software Technology Limited) | November 9, 2012 | PRC | 100 | % | ||||||
TP Teleservices Limited ("TP Teleservices") | November 9, 2012 | Hong Kong | 100 | % | ||||||
TP (Hong Kong) Limited ("TP Hong Kong") | November 9, 2012 | Hong Kong | 100 | % | ||||||
TP Consultants Limited ("TP Consultants") | November 9, 2012 | Hong Kong | 100 | % | ||||||
TP (Taiwan) Limited ("TP Taiwan") | November 9, 2012 | Hong Kong | 100 | % | ||||||
TP Software Technology (Shanghai) Co., Ltd. ("TP Shanghai") | November 9, 2012 | PRC | 100 | % | ||||||
Pactera Financial Service Limited ("Pactera Financial Services") (formerly named "Link Result Limited") | November 9, 2012 | Hong Kong | 100 | % | ||||||
Pactera Data Service (Shanghai) Limited ("Pactera Data") (formerly known as VanceInfo Data Service (Shanghai) Limited) | November 9, 2012 | PRC | 100 | % | ||||||
Beijing Viatt Information Technology Co., Ltd. ("Beijing Viatt") | November 9, 2012 | PRC | 100 | % | ||||||
Lifewood Technology Limited ("Lifewood Technology") | November 9, 2012 | Hong Kong | 100 | % | ||||||
Lifewood Data Technology Limited ("Lifewood Data") | November 9, 2012 | Hong Kong | 100 | % | ||||||
Lifewood Data Technology (Dongguan) Limited ("Lifewood Dongguan") | November 9, 2012 | PRC | 100 | % | ||||||
Pactera Technologies Australia Pty Ltd ("Pactera Australia") (formerly known as VanceInfo Technologies Australia Pty. Ltd.) | November 9, 2012 | Australia | 100 | % | ||||||
Beijing Data Pioneer Information Technology Co., Ltd. ("Beijing DPC") | November 9, 2012 | PRC | 100 | % | ||||||
Beijing Kang Pu Wei Century Information Technology Co., Ltd. ("Beijing KPW") | November 9, 2012 | PRC | 100 | % | ||||||
VanceInfo Singapore Pte. Ltd. ("VanceInfo Singapore") | November 9, 2012 | Singapore | 100 | % | ||||||
Pactera Financial Solutions Limited ("Pactera Financial Solutions") | November 9, 2012 | BVI | 100 | % | ||||||
Beijing Sunwin Corporation Limited ("Sunwin") | November 9, 2012 | PRC | 100 | % | ||||||
Beijing Pactera Airsoft Technology Limited ("Pactera Airsoft") (formerly known as Beijing VanceInfo Airsoft Technology Ltd.) | November 9, 2012 | PRC | 100 | % | ||||||
Suzhou VanceInfo Creative Software Technology Limited ("VanceInfo Suzhou") | November 9, 2012 | PRC | 100 | % | ||||||
Wuxi Pactera Outsourcing Service Limited ("Pactera Outstanding") | May 10, 2013 | PRC | 100 | % | ||||||
Pactera Technology (Mauritius) Limited ("Pactera Mauritius") | August 20, 2013 | Mauritius | 100 | % |
SUMMARY_OF_SIGNIFICANT_ACCOUNT
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended | |||||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ' | |||||||||||||||||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ' | |||||||||||||||||||
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||||||||||||||||||||
Basis of presentation | ||||||||||||||||||||
The consolidated financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States of America ("US GAAP"). | ||||||||||||||||||||
Basis of consolidation | ||||||||||||||||||||
The consolidated financial statements include the financial statements of the Company, all its subsidiaries and the VIE. All inter-company transactions and balances have been eliminated upon consolidation. | ||||||||||||||||||||
Use of estimates | ||||||||||||||||||||
The preparation of consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses for the reporting periods and the accompanying notes. Significant accounting estimates reflected in the consolidated financial statements include, but are not limited to revenue recognition, provision for income taxes, share-based compensation, impairment of goodwill and indefinite lived intangible assets, allowance for doubtful accounts, purchase price allocation in business combinations, contingent consideration, valuation allowance of deferred tax assets, useful life of property, plant and equipment, and economic life of intangible assets as well as performance based share awards. Actual results could differ from those estimates. | ||||||||||||||||||||
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 have original maturities of three months or less when purchased. | ||||||||||||||||||||
Term deposits | ||||||||||||||||||||
The Group's term deposits are classified as held-to-maturity and carried at amortized cost. The term deposits mature within one year from the contractual dates and are subject to penalty for early redemption before their maturity. | ||||||||||||||||||||
Short-term investments | ||||||||||||||||||||
Short-term investments comprise marketable debt securities, which are classified as held-to-maturity as the Group has the positive intent and ability to hold the securities to maturity. All of the Group's held-to-maturity securities are stated at their amortized costs and classified as short-term investments on the consolidated balance sheets based on their contractual maturity dates which are less than one year. | ||||||||||||||||||||
The Group reviews its short-term investments for other-than-temporary impairment based on the specific identification method. The Group considers available quantitative and qualitative evidence in evaluating potential impairment of its short-term investments. If the cost of an investment exceeds the investment's fair value, the Group considers, among other factors, general market conditions, government economic plans, the duration and the extent to which the fair value of the investment is less than the cost, and the Group's intent and ability to hold the investment, in determining if impairment is needed. | ||||||||||||||||||||
Allowance for doubtful accounts | ||||||||||||||||||||
Accounts receivables represent those receivables derived in the ordinary course of business. The Group maintains an allowance for doubtful accounts for estimated incurred losses on uncollected accounts receivables. Management considers the following factors when determining the collectability of specific accounts: credibility of the customers, aging of the receivables, historical loss experience and other specific circumstances related to the accounts. | ||||||||||||||||||||
Assets held for sale | ||||||||||||||||||||
The Group considers property, plant and equipment to be assets held for sale when all of the following criteria are met: i) a formal commitment to a plan to sell a property was made and exercised; ii) the property is available for sale in its present condition; iii) actions required to complete the sale of the property have been initiated; iv) sale of the property is probable and the Group expects the completed sale will occur within one year; v) the property is actively being marketed for sale at a price that is reasonable given its current market value; and vi) actions required to complete the plan indicate that it is unlikely that significant changes to the plan will be made or that the plan will be withdrawn. | ||||||||||||||||||||
Upon designation as an asset held for sale, the Group records each property at the lower of its carrying value or its estimated fair value, less estimated costs to sell, and the Group ceases depreciation. | ||||||||||||||||||||
Concentration risk | ||||||||||||||||||||
Financial instruments that potentially expose the Group to concentrations of credit risk consist primarily of cash and cash equivalents, restricted cash and accounts receivable. The Group places their cash and cash equivalents and restricted cash with authorized financial institutions, which refer to (i) banks incorporated in China, which are all authorized to operate banking business by China Banking Regulatory Commission and other relevant agencies, and (ii) overseas financial institutions regulated by competent regulatory authorities in their relevant jurisdictions such as Hong Kong. The credit risk on cash and cash equivalent and restricted cash is limited because the counterparties are banks with high credit ratings. The Group conducts credit evaluations of its clients and generally does not require collateral or other security from them. The maximum exposure to credit risk is represented by their carrying amounts in the consolidated balance sheet. | ||||||||||||||||||||
Details of customers accounting for 10% or more of net revenues were as follows: | ||||||||||||||||||||
Years ended December 31, | ||||||||||||||||||||
2011 | % | 2012 | % | 2013 | % | |||||||||||||||
Client A | 17,826 | 8 | 29,772 | 8 | 69,530 | 10 | ||||||||||||||
Client B | 23,928 | 11 | 26,582 | 7 | 38,512 | 6 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Details of customer accounting for 10% or more of accounts receivable were as follows: | ||||||||||||||||||||
Years ended | ||||||||||||||||||||
December 31, | ||||||||||||||||||||
2012 | 2013 | |||||||||||||||||||
Client C | 31 | % | 18 | % | ||||||||||||||||
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Equity method investment | ||||||||||||||||||||
Investee companies over which the Group has the ability to exercise significant influence, but does not have a controlling interest are accounted for using the equity method. Significant influence is generally considered to exist when the Group has an ownership interest in the voting stock of the investee between 20% and 50%, and other factors, such as representation in the investee's Board of Directors, voting rights and the impact of commercial arrangements, are considered in determining whether the equity method of accounting is appropriate. | ||||||||||||||||||||
The Group reviews the long-term investments for impairment whenever events or circumstances indicate that an other-than-temporary decline has occurred. An impairment loss is recognized in earnings equal to the amount of the investment's carrying amount in excess of its fair value at the assessment date. The fair value of the investment would then become the new cost basis of the investment. | ||||||||||||||||||||
Property, plant and equipment, net | ||||||||||||||||||||
Property, plant and equipment, net, are stated at cost less accumulated depreciation. Depreciation is provided using the straight-line method over the following estimated useful lives: | ||||||||||||||||||||
Building | 30 years | |||||||||||||||||||
Furniture, fixtures and electronic equipment & software | 3 – 5 years | |||||||||||||||||||
Transportation equipment | 5 years | |||||||||||||||||||
Leasehold improvements | Shorter of useful life | |||||||||||||||||||
of the asset or the lease term | ||||||||||||||||||||
Land use right | ||||||||||||||||||||
All land in the PRC is owned by the PRC government. The government in the PRC, according to the relevant PRC law, may grant the right to the enterprise to use the land for a specified period of time. Land use right is stated at cost less accumulated amortization. Amortization is provided over the contractual term of the land use right on a straight-line basis. | ||||||||||||||||||||
Intangible assets | ||||||||||||||||||||
Acquired intangible assets, other than goodwill, are initially measured and recorded at their fair values. Subsequently, the trade name with indefinite life is stated at cost less impairment loss and other acquired intangible assets with definite life are stated at cost less accumulated amortization and impairment loss. Customer base and customer relationship are amortized using the estimated attrition pattern. Other acquired intangible assets are amortized using the straight-line method. The estimated economic lives are as follows: | ||||||||||||||||||||
Customer base and customer relationship | 3 – 6.8 years | |||||||||||||||||||
Non-compete agreement | 1 – 5 years | |||||||||||||||||||
Contract backlog | 0.5 – 2.14 years | |||||||||||||||||||
Trade name | 1 year – Indefinite | |||||||||||||||||||
Trademark | 1 – 2 years | |||||||||||||||||||
Software Technology | 4 – 5 years | |||||||||||||||||||
Impairment of long-lived assets with definite lives | ||||||||||||||||||||
The Group evaluates the recoverability of long-lived assets, including property, plant and equipment and intangible assets with determinable useful lives whenever events or changes in circumstances indicate that an asset's carrying amount may not be recoverable. The Group measures the carrying amount of long-lived asset against the estimated undiscounted future cash flows associated with it. Impairment exists when the sum of the expected future net cash flows is less than the carrying value of the asset being evaluated. Impairment loss is calculated as the amount by which the carrying value of the asset exceeds its fair value. Fair value is estimated based on various valuation techniques, including the discounted value of estimated future cash flows. The evaluation of asset impairment requires the Group to make assumptions about future cash flows over the life of the asset being evaluated. These assumptions require significant judgment and actual results may differ from assumed and estimated amounts. | ||||||||||||||||||||
Impairment of goodwill and indefinite-lived intangible assets | ||||||||||||||||||||
Goodwill and intangible assets with indefinite useful lives are not amortized, but tested for impairment annually or more frequently if event and circumstances indicate that they 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. Absent from any impairment indicators, the Group performs its annual impairment test on December 31 each year, following a two-step process. The first step compares the fair value of each reporting unit to its carrying amount, including goodwill. If the fair value of each reporting unit exceeds its carrying amount, goodwill is not considered to be impaired and the second step will not be required. If the carrying amount of a reporting unit exceeds its fair value, the second step compares the implied fair value of goodwill to the carrying value of a reporting unit's goodwill. The implied fair value of goodwill is determined in a manner similar to accounting for a business combination with the allocation of the assessed fair value determined in the first step to the assets and liabilities of the reporting unit. The excess of the fair value of the reporting unit over the amounts assigned to the assets and liabilities is the implied fair value of goodwill. An impairment loss is recognized for any excess in the carrying value of goodwill over the implied fair value of goodwill. | ||||||||||||||||||||
The Group has determined that the Group's certain trade names do not have determinable useful lives. Consequently, the carrying amounts of these trade names are not subject to amortization but are tested for impairment at least annually or if events or changes in circumstances indicate that the asset might be impaired. Such impairment test compares the fair values of assets with their carrying value amounts and an impairment loss is recognized if and when the carrying amounts exceed the fair values. The estimates of fair values of intangible assets not subject to amortization are determined using various discounted cash flow valuation methodologies. Significant assumptions are inherent in this process, including estimates of discount rates. | ||||||||||||||||||||
Revenue recognition | ||||||||||||||||||||
The Group enters into sales contractual arrangements related to its technology outsourcing services. For each contract, revenues are recognized in accordance with an authoritative pronouncement regarding revenue recognition issued by Financial Accounting Standards Board ("FASB") and when all of the following criteria are met: persuasive evidence of sales arrangement exists; delivery has occurred or services have been rendered; the price is fixed or determinable; and collectability is reasonably assured. | ||||||||||||||||||||
Arrangements for technology outsourcing services are either on a time-and-material or fixed-price basis. | ||||||||||||||||||||
Revenues from time-and-material contracts are recognized as billable services are rendered, assuming all other basic revenue recognition criteria are met. | ||||||||||||||||||||
Revenues from fixed-price contracts are recognized using the proportional performance method as determined by the proportional relation of the contract costs incurred to date relative to the estimated total contract costs at completion. Estimated contract costs are obtained from budgets that are reviewed monthly and revised as necessary. The Group reviews the estimated revenues and estimated costs on each project at the end of each reporting period. Any revisions to existing estimates are made when required by members of management having the relevant authority. As part of the review process, management regularly compares and analyzes the actual costs incurred and the estimate of costs to complete the projects to the total estimated costs and the total contract price. Management make revisions to existing estimates as needed based on the analysis performed and with proper level of approval in the period in which changes become known. As a policy, provisions for estimated losses on such engagements will be made during the period in which a loss becomes probable and can be reasonably estimated. | ||||||||||||||||||||
Reimbursable out-of-pocket expenses and material costs are recognized as revenues when billed. | ||||||||||||||||||||
For the years ended December 31, 2011, 2012 and 2013, details of net revenues breakdown by contract type were as follows: | ||||||||||||||||||||
Years ended December 31, | ||||||||||||||||||||
2011 | 2012 | 2013 | ||||||||||||||||||
Time-and-material | $ | 175,115 | $ | 282,615 | $ | 543,062 | ||||||||||||||
Fixed-price | 43,874 | 76,416 | 126,957 | |||||||||||||||||
| | | | | | | | | | | ||||||||||
Total | $ | 218,989 | $ | 359,031 | $ | 670,019 | ||||||||||||||
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Value added tax ("VAT") | ||||||||||||||||||||
The Company's PRC subsidiaries are subject to value-added tax at a rate of 17% on revenues from product sales and services and are paid after deducting input VAT on purchases. The net VAT balance between input VAT and output VAT is reflected in the account under other taxes payable. | ||||||||||||||||||||
In July 2012, the Ministry of Finance and the State Administration of Taxation jointly issued a circular regarding the pilot collection of VAT in lieu of business tax in certain areas and industries in the PRC. Such VAT pilot program is to be phased in Beijing, Jiangsu, Anhui, Fujian, Guangdong, Tianjin, Zhejiang and Hubei starting from September 1, 2012, October 1, 2012, October 1, 2012, November 1, 2012, November 1, 2012, December 1, 2012, December 1, 2012 and December 1, 2012. Since August 2013, this tax pilot program had been expanded to the remaining areas within China. As a result, from August 1, 2013 the Company's PRC subsidiaries are subject to VAT at the rates, 6% or 3%. | ||||||||||||||||||||
Business tax | ||||||||||||||||||||
The Company's subsidiaries in the PRC are subject to business tax of 5% and related surcharges on the revenues earned from providing services. Business tax is recorded as a reduction in revenues when incurred, and the outstanding balance has been recorded in other taxes payable. | ||||||||||||||||||||
Government subsidies | ||||||||||||||||||||
Government subsidies mainly represent amounts granted by local government authorities as an incentive for companies to promote development of the local technology industry. The Group receives government subsidies related to government sponsored projects, and records such government subsidies as a liability when it is received. The Group records government subsidies as deductions of the related expenses when there is no further performance obligation. Total government subsidies amounted to $2,744, $13,334 and $11,326 for the years ended December 31, 2011, 2012 and 2013, respectively, and were included in general and administrative expenses and cost of revenues. | ||||||||||||||||||||
Operating leases | ||||||||||||||||||||
Leases where substantially all the rewards and risks of ownership of assets remain with the lessor are accounted for as operating leases. Payments made under operating leases are charged to the consolidated statements of operations on a straight-line basis over the lease periods. | ||||||||||||||||||||
Capital leases | ||||||||||||||||||||
Capital leases are recorded as an asset and an obligation at an amount equal to the present value, at the beginning of lease term, of minimum lease payments during the lease term, or if lower, the fair value of the leased assets. The assets are amortized over the useful lives of the assets, or if shorter, the lease term. Lease payments are allocated between a reduction of the obligation and interest expense so as to produce a consistent periodic rate of interest on the remaining balance of the obligation. | ||||||||||||||||||||
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 consolidated 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 on the income tax return 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. | ||||||||||||||||||||
Foreign currency translation | ||||||||||||||||||||
The functional and reporting currency of the Company is the United States dollar ("U.S. dollar"). | ||||||||||||||||||||
The financial records of the Company's subsidiaries and VIE located in the PRC, Japan, the U.S., Hong Kong, Singapore, Australia and Spain are maintained in their local currencies, the Renminbi ("RMB"), Japanese Yen ("Yen"), U.S. dollar, Hong Kong Dollar ("HK$"), Singapore Dollars ("SN$"), Australia Dollar ("AU$") and Euro Dollar ("Euro"), respectively, which are also the functional currencies of these entities. | ||||||||||||||||||||
Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency at the rates of exchange ruling at the balance sheet date. Transactions in currencies other than the functional currency during the year are converted into functional currency at the applicable rates of exchange prevailing when the transactions occurred. Transaction gains and losses are recognized in the consolidated statements of operations. For the years ended December 31, 2011, 2012 and 2013, foreign currency exchange losses were $2,070, $1,042 and $616, respectively. | ||||||||||||||||||||
The entities with functional currency other than U.S. dollar translate their operating results and financial position into the U.S. dollar, the Group's reporting currency. Assets and liabilities are translated using the exchange rates in effect on the balance sheet date. Equity amounts are translated at historical exchange rates. Revenues, expenses, gains and losses are translated using the average rate for the year. Translation adjustments are reported as foreign currency translation adjustments and are shown as a separate component of other comprehensive income. | ||||||||||||||||||||
The exchange losses have been reclassified from operating expenses to other income in the consolidated financial statement to conform with the presentation of the financial statements for the year ended December 31, 2013. | ||||||||||||||||||||
Comprehensive income | ||||||||||||||||||||
Comprehensive income for the year includes net income and foreign currency translation adjustments and is reported in the consolidated statements of comprehensive income. | ||||||||||||||||||||
Financial instruments | ||||||||||||||||||||
Financial instruments include cash and cash equivalents, restricted cash, term deposits, short-term investment, accounts receivable and accounts payable. The carrying values of cash and cash equivalents, restricted cash, term deposits, accounts receivable and accounts payable approximate their fair values due to short-term maturities. | ||||||||||||||||||||
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 that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. An asset or liability categorization within the fair value hierarchy 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 assets or liabilities 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. Fair value of foreign currency forward contracts is discussed in Note 15. | ||||||||||||||||||||
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. | ||||||||||||||||||||
Fair value of acquired assets and contingent consideration is discussed in Note 15. | ||||||||||||||||||||
Net income per share | ||||||||||||||||||||
Basic net income per common share is computed by dividing net income attributable to common shareholders by the weighted average number of common shares outstanding during the period. | ||||||||||||||||||||
Diluted net income per common share reflects the potential dilution that could occur if securities or other contracts to issue common shares were exercised or converted into common shares. | ||||||||||||||||||||
The Group had stock options and potentially issuable common shares whose issuance is contingent upon the satisfaction of certain conditions in connection with business acquisitions, which could potentially dilute basic net income per share. To calculate the number of shares for diluted net income per share, the effect of stock options is computed using the treasury stock method. | ||||||||||||||||||||
Share-based compensation | ||||||||||||||||||||
Share-based payment transactions with employees, such as stock options, are measured based on the grant date fair value of the equity instrument. The Group recognizes the compensation costs, net of expected forfeitures, using the graded vesting method over the requisite service period of the award, which is generally the vesting period of the award. The estimate of forfeitures will be adjusted over the requisite service period to the extent that actual forfeitures differ, or are expected to differ, from such estimates. Changes in estimated forfeitures are recognized through a cumulative catch-up adjustment in the period of change and will also impact the amount of stock compensation expense to be recognized in future periods. | ||||||||||||||||||||
Business combinations | ||||||||||||||||||||
Business combinations are recorded using the acquisition method of accounting. The assets acquired, the liabilities assumed, and any non-controlling 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 non-controlling interest of the acquiree, if any, at the acquisition date over the fair values of the identifiable net assets acquired. | ||||||||||||||||||||
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 of 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, 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 the consolidated statements of operations. | ||||||||||||||||||||
Recent 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 significant effect on its consolidated financial statements. | ||||||||||||||||||||
In July 2013, the FASB issued a pronouncement 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 Accounting Standards Updates ("ASU") is to eliminate diversity in practice resulting from a lack of guidance on this topic in current US 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 significant effect on its consolidated financial statements. | ||||||||||||||||||||
Recent accounting pronouncements adopted | ||||||||||||||||||||
In February 2013, the FASB issued an authoritative pronouncement related to reporting of amounts reclassified out of accumulated other comprehensive income, to improve the transparency of reporting these reclassifications. Other comprehensive income includes gains and losses that are initially excluded from net income for an accounting period. Those gains and losses are later reclassified out of accumulated other comprehensive income into net income. The amendments in this ASU do not change the current requirements for reporting net income or other comprehensive income in financial statements. All of the information that this ASU requires already is required to be disclosed elsewhere in the financial statements under US GAAP. | ||||||||||||||||||||
The new amendments will require an organization to: | ||||||||||||||||||||
• | ||||||||||||||||||||
Present (either on the face of the statement where net income is presented or in the notes) the effects on the line items of net income of significant amounts reclassified out of accumulated other comprehensive income—but only if the item reclassified is required under US GAAP to be reclassified to net income in its entirety in the same reporting period. | ||||||||||||||||||||
• | ||||||||||||||||||||
Cross-reference to other disclosures currently required under US GAAP for other reclassification items (that are not required under US GAAP) to be reclassified directly to net income in their entirety in the same reporting period. This would be the case when a portion of the amount reclassified out of accumulated other comprehensive income is initially transferred to a balance sheet account (e.g., inventory for pension-related amounts) instead of directly to income or expense. | ||||||||||||||||||||
The amendments apply to all public and private companies that report items of other comprehensive income. Public companies are required to comply with these amendments for all reporting periods (interim and annual). The amendments are effective for reporting periods beginning after December 15, 2012, for public companies. Early adoption is permitted. The Group adopted this pronouncement on January 1, 2013 which did not have a significant impact on its consolidated financial statements. | ||||||||||||||||||||
ACQUISITIONS
ACQUISITIONS | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
ACQUISITIONS | ' | |||||||
ACQUISITIONS | ' | |||||||
3. ACQUISITIONS | ||||||||
(a) | ||||||||
Beans | ||||||||
On January 1, 2011, the Group acquired substantially all of the business and assets of Beans ("Beans"), a Singapore-based research and development service provider. The total consideration of $2,042 consists of: | ||||||||
• | ||||||||
Cash consideration of $574 in cash paid upon closing; and | ||||||||
• | ||||||||
Contingent consideration valued at $1,468 based on financial performance of Beans in fiscal year 2012. | ||||||||
The purchase price allocation of the transaction, determined by the Group with the assistance of an independent valuer, was allocated to assets acquired and liabilities assumed as of the date of acquisition as follows: | ||||||||
Estimated | ||||||||
useful lives | ||||||||
Intangible assets acquired: | ||||||||
Customer relationship | $ | 927 | 6 years | |||||
Goodwill | 1,115 | |||||||
| | | | | | |||
Total | $ | 2,042 | ||||||
| | | | | | |||
Total consideration | $ | 2,042 | ||||||
| | | | | | |||
| | | | | | |||
The Group believes that the acquisition would strengthen its service capability and market position in Singapore. | ||||||||
(b) | ||||||||
Business team of China-based IT service firms | ||||||||
On February 1, 2011, the Group acquired a business team from certain China-based IT service firms ("Business Team") that provide IT consulting services to clients in the financial services industry. | ||||||||
The total cash consideration of $2,500 was paid in July 2011. | ||||||||
The purchase price allocation of the transaction, determined by the Group with the assistance of an independent valuer, was allocated to assets acquired and liabilities assumed as of the date of acquisition as follows: | ||||||||
Estimated | ||||||||
useful lives | ||||||||
Intangible assets acquired: | ||||||||
Contract backlog | $ | 287 | 0.9 year | |||||
Customer relationship | 666 | 4.9 years | ||||||
Goodwill | 1,547 | |||||||
| | | | | | |||
Total consideration | $ | 2,500 | ||||||
| | | | | | |||
| | | | | | |||
The Group believes that the acquisition will expand the Group's business in financial industry and increase the Group's geographic presence and service offerings in China. | ||||||||
The results of operations of the Business Team have been included in the consolidated financial statements from the acquisition date. The acquired goodwill is not deductible for tax purpose. | ||||||||
The following unaudited pro forma information summarizes the results of operations of the Group, including the acquisition of Business Team assuming that the acquisition occurred as of January 1, 2011. The following pro forma financial information is not necessarily indicative of the results that would have occurred had the acquisition been completed at the beginning of the period indicated, nor is it indicative of future operating results: | ||||||||
Year ended | ||||||||
December 31, | ||||||||
2011 | ||||||||
(Unaudited) | ||||||||
Net revenues | $ | 219,197 | ||||||
Net income | 17,715 | |||||||
Net income per share | ||||||||
—Basic | $ | 0.44 | ||||||
| | | | | ||||
| | | | | ||||
—Diluted | $ | 0.41 | ||||||
| | | | | ||||
| | | | | ||||
The pro forma results of operations give effect to certain adjustments, including amortization of acquired intangible assets with definite lives, associated with the acquisition. There are no nonrecurring pro forma adjustments directly attributable to the business combination. | ||||||||
(c) | ||||||||
NouvEON | ||||||||
On July 1, 2011, the Group acquired 100% equity interest in NouvEON, a U.S.-based IT consulting services firm. The estimated purchase price was $14,160, consisting of: | ||||||||
• | ||||||||
Cash consideration of $6,757 to be paid in 2011; and | ||||||||
• | ||||||||
Contingent consideration estimated at $7,403 based on financial results of NouvEon from July 1, 2011 to June 30, 2013. | ||||||||
The purchase price allocation of the transaction, determined by the Group with the assistance of an independent valuer, was allocated to assets acquired and liabilities assumed as of the date of acquisition as follows: | ||||||||
Estimated | ||||||||
useful lives | ||||||||
Net liabilities assumed: | ||||||||
Current assets | $ | 830 | ||||||
Current liabilities | (1,879 | ) | ||||||
| | | | | | |||
Total | $ | (1,049 | ) | |||||
| | | | | | |||
Intangible assets acquired: | ||||||||
Customer relationship | 3,300 | 4 years | ||||||
Trademark | 2,900 | Indefinite | ||||||
Backlog | 283 | 1 year | ||||||
Goodwill | 10,930 | |||||||
Deferred tax liability | (2,204 | ) | ||||||
| | | | | | |||
Total | $ | 15,209 | ||||||
| | | | | | |||
Total consideration | $ | 14,160 | ||||||
| | | | | | |||
| | | | | | |||
The Group believes that NouvEON's value-driven expertise and tailored solutions combined with their strong domain expertise in financial services will greatly benefit the Group and the Group's global client base. | ||||||||
The results of operations of NouvEON have been included in the consolidated financial statements from the acquisition date. The acquired goodwill is not deductible for tax purpose. | ||||||||
The following unaudited pro forma information summarizes the results of operations of the Group, including the acquisition of NouvEON assuming that the acquisition occurred as of January 1, 2011. The following pro forma financial information is not necessarily indicative of the results that would have occurred had the acquisition been completed at the beginning of the period indicated, nor is it indicative of future operating results: | ||||||||
Year ended | ||||||||
December 31, | ||||||||
2011 | ||||||||
(Unaudited) | ||||||||
Net revenues | $ | 225,390 | ||||||
Net income | 17,260 | |||||||
Net income per share | ||||||||
—Basic | $ | 0.43 | ||||||
| | | | | ||||
—Diluted | $ | 0.4 | ||||||
| | | | | ||||
| | | | | ||||
The pro forma results of operations give effect to certain adjustments, including success fee and amortization of acquired intangible assets with finite lives, associated with the acquisition. | ||||||||
(d) | ||||||||
HURO | ||||||||
On October 1, 2011, the Group acquired 100% equity interest in HURO, a China-based IT service firm that provides IT consulting services to clients in the BFSI industry. | ||||||||
The estimated purchase price was $7,293, consisting of: | ||||||||
• | ||||||||
Cash consideration of $3,282 to be paid in 2011 and 2012; and | ||||||||
• | ||||||||
Contingent consideration estimated at $4,011 based on financial results of HURO from October 1, 2011 to September 30, 2014. | ||||||||
The purchase price allocation of the transaction, determined by the Group with the assistance of an independent valuer, was allocated to assets acquired and liabilities assumed as of the date of acquisition as follows: | ||||||||
Estimated | ||||||||
useful lives | ||||||||
Net tangible assets: | ||||||||
Current assets | $ | 4,375 | ||||||
Current liabilities | (3,825 | ) | ||||||
| | | | | | |||
Total | $ | 550 | ||||||
| | | | | | |||
Intangible assets acquired: | ||||||||
Customer relationship | 1,339 | 5 years | ||||||
Contract backlog | 856 | 1 year | ||||||
Trade name | 1,425 | Indefinite | ||||||
Non-compete agreement | 359 | 5 years | ||||||
Goodwill | 3,361 | |||||||
Deferred tax liability | (597 | ) | ||||||
| | | | | | |||
Total | $ | 6,743 | ||||||
| | | | | | |||
Total consideration | $ | 7,293 | ||||||
| | | | | | |||
| | | | | | |||
The Group believes that the acquisition will expand the Group's business in financial industry and increase the Group's geographic presence and service offerings in China. | ||||||||
The results of operations of HURO have been included in the consolidated financial statements from the acquisition date. The acquired goodwill is not deductible for tax purpose. | ||||||||
The following unaudited pro forma information summarizes the results of operations of the Group, including the acquisition of HURO assuming that the acquisition occurred as of January 1, 2011. The following pro forma financial information is not necessarily indicative of the results that would have occurred had the acquisition been completed at the beginning of the period indicated, nor is it indicative of future operating results: | ||||||||
Year ended | ||||||||
December 31, | ||||||||
2011 | ||||||||
(Unaudited) | ||||||||
Net revenues | $ | 222,856 | ||||||
Net income | 17,514 | |||||||
Net income per share | ||||||||
—Basic | $ | 0.43 | ||||||
| | | | | ||||
—Diluted | $ | 0.41 | ||||||
| | | | | ||||
| | | | | ||||
The pro forma results of operations give effect to certain adjustments, including amortization of acquired intangible assets with finite lives, associated with the acquisition. There are no nonrecurring pro forma adjustments directly attributable to the business combination. | ||||||||
(e) | ||||||||
Logoscript | ||||||||
In February 2012, the Group acquired 100% interest in Logoscript International S.L., a Spain-based software localization and technical translation services provider and its subsidiaries based in Spain, Brazil and Portugal. Logoscript International S.L. and its subsidiaries are hereinafter referred to as "Logoscript". | ||||||||
The estimated purchase price was $1,399, consisting of: | ||||||||
• | ||||||||
Cash consideration of $1,158 to be paid in 2012; and | ||||||||
• | ||||||||
Contingent consideration estimated at $241 based on the financial performance of Logoscript from January 1, 2012 to December 31, 2013. | ||||||||
The purchase price allocation of the transaction, determined by the Group with the assistance of an independent appraiser, was allocated to assets acquired and liabilities assumed as of the date of acquisition as follows: | ||||||||
Estimated | ||||||||
useful life | ||||||||
Net tangible assets: | ||||||||
Assets | $ | 1,592 | ||||||
Liabilities | (1,150 | ) | ||||||
| | | | | | |||
Total | $ | 442 | ||||||
| | | | | | |||
Intangible assets acquired: | ||||||||
Customer relationship | 233 | 3 years | ||||||
Goodwill | 794 | |||||||
Deferred tax liability | (70 | ) | ||||||
| | | | | | |||
Total | $ | 957 | ||||||
| | | | | | |||
Total consideration | $ | 1,399 | ||||||
| | | | | | |||
| | | | | | |||
The Group believes that the acquisition will improve its presence in Europe as well as obtain multilingual talents. | ||||||||
The results of operations of Logoscript have been included in the consolidated financial statements from the acquisition date. The acquired goodwill is not deductible for tax purpose. | ||||||||
The following unaudited pro forma information summarizes the results of operations of the Group, as if the acquisition had occurred as of January 1, 2011. The following pro forma financial information is not necessarily indicative of the results that would have occurred had the acquisition been completed at the beginning of the periods indicated, nor is it indicative of future operating results: | ||||||||
Years ended December 31, | ||||||||
2011 | 2012 | |||||||
(Unaudited) | (Unaudited) | |||||||
Net revenues | $ | 222,836 | $ | 359,352 | ||||
Net income | 17,458 | 2,553 | ||||||
Net income per share | ||||||||
—Basic | $ | 0.43 | $ | 0.05 | ||||
| | | | | | | | |
| | | | | | | | |
—Diluted | $ | 0.41 | $ | 0.05 | ||||
| | | | | | | | |
| | | | | | | | |
The pro forma results of operations give effect to certain adjustments, including amortization of acquired intangible assets with finite lives, associated with the acquisition. There are no nonrecurring pro forma adjustments directly attributable to the business combination. | ||||||||
(f) | ||||||||
Longhaul | ||||||||
In March 2012, the Group acquired substantially all of the business and assets of Shenzhen Longhaul Information Technology Ltd., or Longhaul, a China-based SAP consulting services company, which mainly provides SAP implementation and maintenance services in China. | ||||||||
The estimated purchase price was $1,494, consisting of: | ||||||||
• | ||||||||
Cash consideration of $772 to be paid in May 2012; and | ||||||||
• | ||||||||
Contingent consideration estimated at $722 based on the financial performance of Longhaul from March 1, 2012 to December 31, 2014. | ||||||||
The purchase price allocation of the transaction, determined by the Group with the assistance of an independent appraiser, was allocated to assets acquired as of the date of acquisition as follows: | ||||||||
Estimated | ||||||||
useful lives | ||||||||
Intangible assets acquired: | ||||||||
Customer relationship | 190 | 3.5 years | ||||||
Contract backlog | 27 | 0.25 year | ||||||
Non-compete agreement | 262 | 4 years | ||||||
Goodwill | 1,015 | |||||||
| | | | | | |||
Total | $ | 1,494 | ||||||
| | | | | | |||
Total consideration | $ | 1,494 | ||||||
| | | | | | |||
| | | | | | |||
The business purpose of this acquisition is to acquire the team's specialized knowledge of SAP, and related contracts and customers to enhance the Group's ability to expand into the SAP service market in China. | ||||||||
The results of operations of Longhaul have been included in the consolidated financial statements from the acquisition date. The acquired goodwill is not deductible for tax purpose. The amounts of revenue and earnings of the acquired business since the acquisition date are not separately presented because the acquired business' operation has been integrated into the Group's business after the transaction was completed. | ||||||||
The following unaudited pro forma information summarizes the results of operations of the Group, as if the acquisition had occurred as of January 1, 2011. The following pro forma financial information is not necessarily indicative of the results that would have occurred had the acquisition been completed at the beginning of the periods indicated, nor is it indicative of future operating results: | ||||||||
Years ended December 31, | ||||||||
2011 | 2012 | |||||||
(Unaudited) | (Unaudited) | |||||||
Net revenues | $ | 220,733 | $ | 359,322 | ||||
Net income | 17,858 | 2,583 | ||||||
Net income per share | ||||||||
—Basic | $ | 0.44 | 0.05 | |||||
| | | | | | | | |
| | | | | | | | |
—Diluted | $ | 0.42 | 0.05 | |||||
| | | | | | | | |
| | | | | | | | |
The pro forma results of operations give effect to certain adjustments, including amortization of acquired intangible assets with finite lives, associated with the acquisition. There are no nonrecurring pro forma adjustments directly attributable to the business combination. | ||||||||
(g) | ||||||||
Glory | ||||||||
In June 2012, the Group acquired 100% equity interest in Beijing GloryCube Technology Co., Ltd., or Glory, a China-based IT service firm that specialized in CRM system design and implementation in the financial industry in China. | ||||||||
The estimated purchase price was $6,616, consisting of: | ||||||||
• | ||||||||
Cash consideration of $3,061 to be paid in 2012; and | ||||||||
• | ||||||||
Contingent consideration estimated at $3,555 based on the financial performance of Glory from June 1, 2012 to March 31, 2014. | ||||||||
The purchase price allocation of the transaction, determined by the Group with the assistance of an independent appraiser, was allocated to assets acquired and liabilities assumed as of the date of acquisition as follows: | ||||||||
Estimated | ||||||||
useful lives | ||||||||
Net tangible assets: | ||||||||
Current assets | $ | 1,465 | ||||||
Current liabilities | (1,879 | ) | ||||||
| | | | | | |||
Total | $ | (414 | ) | |||||
| | | | | | |||
Intangible assets acquired: | ||||||||
Customer relationship | 959 | 5 years | ||||||
Contract backlog | 530 | 1 year | ||||||
Trade name | 2,149 | Indefinite | ||||||
Non-compete clause | 225 | 5 years | ||||||
Goodwill | 3,746 | |||||||
Deferred tax liability | (579 | ) | ||||||
| | | | | | |||
Total | $ | 7,030 | ||||||
| | | | | | |||
Total consideration | $ | 6,616 | ||||||
| | | | | | |||
| | | | | | |||
The Group believes that the acquisition will expand the Group's business in the financial industry in China and increase the Group's geographic presence and service offerings. | ||||||||
The results of operations of Glory have been included in the consolidated financial statements from the acquisition date. The acquired goodwill is not deductible for tax purpose. The amounts of revenue and earnings of the acquiree since the acquisition date are not separately presented because the acquiree's operation has been integrated into the Group's business after the transaction was completed. | ||||||||
The following unaudited pro forma information summarizes the results of operations of the Group, as if the acquisition had occurred as of January 1, 2011. The following pro forma financial information is not necessarily indicative of the results that would have occurred had the acquisition been completed at the beginning of the periods indicated, nor is it indicative of future operating results: | ||||||||
Years ended December 31, | ||||||||
2011 | 2012 | |||||||
(Unaudited) | (Unaudited) | |||||||
Net revenues | $ | 223,225 | $ | 360,796 | ||||
Net income | 18,050 | 2,652 | ||||||
Net income per share | ||||||||
—Basic | $ | 0.44 | $ | 0.06 | ||||
| | | | | | | | |
| | | | | | | | |
—Diluted | $ | 0.42 | $ | 0.05 | ||||
| | | | | | | | |
| | | | | | | | |
The pro forma results of operations give effect to certain adjustments, including amortization of acquired intangible assets with finite lives, associated with the acquisition. There are no nonrecurring pro forma adjustments directly attributable to the business combination. | ||||||||
(h) | ||||||||
Bearing Point | ||||||||
In July 2012, the Group acquired 100% equity interest in Bearing Point Holding Pty. Limited and its subsidiaries (hereinafter refer to as "Bearing Point"), a IT consulting services provider based in Australia. | ||||||||
The estimated purchase price was $7,465, consisting of: | ||||||||
• | ||||||||
Cash consideration of $3,601 to be paid upon closing; and | ||||||||
• | ||||||||
Contingent consideration estimated at $3,864 based on the financial performance of Bearing Point from July 1, 2012 to December 31, 2014. | ||||||||
Besides the above payments, an amount of $1,025 was paid in August 2012 to the former shareholders of Bearing Point. Since the Group has the right to be paid back this amount if these shareholders cease their employment with the Group at any time before the third anniversary of the closing date, the $1,025 is accounted for as deferred employee compensation expense and amortized over the three-year service period. | ||||||||
The purchase price allocation of the transaction, determined by the Group with the assistance of an independent appraiser, was allocated to assets acquired and liabilities assumed as of the date of acquisition as follows: | ||||||||
Estimated | ||||||||
useful lives | ||||||||
Net tangible assets: | ||||||||
Assets | $ | 6,729 | ||||||
Liabilities | (5,180 | ) | ||||||
| | | | | | |||
Total | $ | 1,549 | ||||||
| | | | | | |||
Intangible assets acquired: | ||||||||
Customer relationship | 1,845 | 5 years | ||||||
Trade name | 512 | 2 years | ||||||
Goodwill | 4,266 | |||||||
Deferred tax liability | (707 | ) | ||||||
| | | | | | |||
Total | $ | 5,916 | ||||||
| | | | | | |||
Total consideration | $ | 7,465 | ||||||
| | | | | | |||
| | | | | | |||
The Group believes that the acquisition will expand the Group's business in Asia South and increase the Group's geographic presence and service offerings. | ||||||||
The results of operations of Bearing Point have been included in the consolidated financial statements from the acquisition date. The acquired goodwill is not deductible for tax purpose. The amounts of revenue and earnings of the acquiree since the acquisition date are not separately presented because the acquiree's operation has been integrated into the Group's business after the transaction was completed. | ||||||||
The following unaudited pro forma information summarizes the results of operations of the Group, as if the acquisition had occurred as of January 1, 2011. The following pro forma financial information is not necessarily indicative of the results that would have occurred had the acquisition been completed at the beginning of the periods indicated, nor is it indicative of future operating results: | ||||||||
Years ended December 31, | ||||||||
2011 | 2012 | |||||||
(Unaudited) | (Unaudited) | |||||||
Net revenues | $ | 238,002 | $ | 368,538 | ||||
Net income | 17,690 | 2,484 | ||||||
Net income per share | ||||||||
—Basic | $ | 0.44 | $ | 0.05 | ||||
| | | | | | | | |
| | | | | | | | |
—Diluted | $ | 0.41 | $ | 0.05 | ||||
| | | | | | | | |
| | | | | | | | |
The pro forma results of operations give effect to certain adjustments, including amortization of acquired intangible assets with finite lives, associated with the acquisition. There are no nonrecurring pro forma adjustments directly attributable to the business combination. | ||||||||
(i) | ||||||||
Newton | ||||||||
In August 2012, the Group acquired 100% equity interest in Newton Technology Limited ("Newton"), a system developer under Java platform based in Japan. | ||||||||
The estimated purchase price was $1,464, consisting of: | ||||||||
• | ||||||||
Cash consideration of $1,241 to be paid upon closing; and | ||||||||
• | ||||||||
Contingent consideration estimated at $223 based on the financial performance of Newton from August 1, 2012 to June 30, 2014. | ||||||||
The purchase price allocation of the transaction, determined by the Group with the assistance of an independent appraiser, was allocated to assets acquired and liabilities assumed as of the date of acquisition as follows: | ||||||||
Estimated | ||||||||
useful lives | ||||||||
Net tangible assets: | ||||||||
Assets | $ | 936 | ||||||
Liabilities | (465 | ) | ||||||
| | | | | | |||
Total | $ | 471 | ||||||
| | | | | | |||
Intangible assets acquired: | ||||||||
Acquired software | 168 | 5 years | ||||||
Contract backlog | 3 | 0.5 year | ||||||
Customer relationship | 434 | 5 years | ||||||
Goodwill | 557 | |||||||
Deferred tax liability | (169 | ) | ||||||
| | | | | | |||
Total | $ | 993 | ||||||
| | | | | | |||
Total consideration | $ | 1,464 | ||||||
| | | | | | |||
| | | | | | |||
The acquired software has been written-off as of December 31, 2012 because the Group decided not to actively use it in its future operations. | ||||||||
The Group believes that the acquisition will expand the Group's business in Japan and increase the Group's geographic presence and service offerings. | ||||||||
In November 2012, all the business and assets of Newton were transferred to Pactera Japan. Accordingly, Newton was closed down prior to the end of year 2012. | ||||||||
The results of operations of Newton have been included in the consolidated financial statements from the acquisition date. The acquired goodwill is not deductible for tax purpose. The amounts of revenue and earnings of the acquiree since the acquisition date are not separately presented because the acquiree's operation has been integrated into the Group's business after the transaction was completed. | ||||||||
The following unaudited pro forma information summarizes the results of operations of the Group, as if the acquisition had occurred as of January 1, 2011. The following pro forma financial information is not necessarily indicative of the results that would have occurred had the acquisition been completed at the beginning of the periods indicated, nor is it indicative of future operating results: | ||||||||
Years ended December 31, | ||||||||
2011 | 2012 | |||||||
(Unaudited) | (Unaudited) | |||||||
Net revenues | $ | 221,197 | $ | 360,319 | ||||
Net income | 17,425 | 2,313 | ||||||
Net income per share | ||||||||
—Basic | $ | 0.43 | $ | 0.05 | ||||
| | | | | | | | |
| | | | | | | | |
—Diluted | $ | 0.41 | $ | 0.05 | ||||
| | | | | | | | |
| | | | | | | | |
The pro forma results of operations give effect to certain adjustments, including amortization of acquired intangible assets with finite lives, associated with the acquisition. There are no nonrecurring pro forma adjustments directly attributable to the business combination. | ||||||||
(j) | ||||||||
Acquisition of non-controlling interest in Pactera Jinxin | ||||||||
In December 2010, HiSoft Beijing and five third party individuals entered into an agreement to form Pactera Jinxin in which HiSoft Beijing and the five individuals own 60% and 40% of the total equity interest, respectively. In connection with the company formation, HiSoft Beijing and the five individuals injected $1,364 and $909, respectively to incorporate Pactera Jinxin, a PRC company engaged in providing outsourcing business to the banking and insurance industries in China. | ||||||||
In October 1, 2012, HiSoft Beijing acquired the 40% of the equity interest from the non-controlling shareholders of Pactera Jinxin with a total consideration of $12,938, of which $1,203 and $9,278 were paid in 2012 and 2013, respectively. The remaining consideration of $2,457 is expected to be paid in 2014 subject to the Pactera Jinxin's financial performance for the year ended December 31, 2013. | ||||||||
(k) | ||||||||
VanceInfo | ||||||||
On November 9, 2012, the Group completed the merger of equals with VanceInfo, a listed company on New York Stock Exchange ("NYSE") that provides outsourced information technology services. According to the Merger Agreement, Hisoft and VanceInfo shareholders each owned approximately 50% of the combined company at the transaction closing. The merger was accounted for as a business combination using the purchase method with the Company treated as the accounting acquirer. | ||||||||
The total consideration was calculated based on the fair value of the shares issued in connection with the merger, including shares issued in exchange for vested VanceInfo stock options and restricted share units ("RSU"). | ||||||||
The total consideration was calculated below: | ||||||||
Issuance of common shares | 42,517 | |||||||
Closing price on transaction date | $ | 7.49 | ||||||
| | | | | ||||
Stock consideration | $ | 318,451 | ||||||
Fair value of vested VanceInfo stock options and RSU | 8,327 | |||||||
| | | | | ||||
Total consideration | $ | 326,778 | ||||||
| | | | | ||||
| | | | | ||||
The purchase price allocation of the transaction, determined by the Group with the assistance of an independent appraiser, was allocated to assets acquired and liabilities assumed as of the date of acquisition as follows: | ||||||||
Estimated | ||||||||
useful lives | ||||||||
Net tangible assets: | ||||||||
Assets | $ | 319,072 | ||||||
Liabilities | (81,715 | ) | ||||||
| | | | | | |||
Total | $ | 237,357 | ||||||
| | | | | | |||
Intangible assets acquired: | ||||||||
Customer relationship | 11,540 | 4 – 6 years | ||||||
Trade name | 27,840 | 2 years – indefinite | ||||||
Software technology | 2,290 | 4 – 5 years | ||||||
Contract backlog | 910 | 2 years | ||||||
Non-compete agreement | 1,400 | 1 – 4 years | ||||||
Goodwill | 54,407 | |||||||
Deferred tax liability | (8,966 | ) | ||||||
| | | | | | |||
Total | $ | 89,421 | ||||||
| | | | | | |||
Total consideration | $ | 326,778 | ||||||
| | | | | | |||
| | | | | | |||
The fair values of the intangible assets were determined using the "cost", "income approach-excess earnings", "with and without" and "relief from royalty" valuation methods. In performing the purchase price allocation, the Company considered, among other factors, forecasted financial performance of the acquired business and market performance of the acquired business in China. | ||||||||
The goodwill is mainly attributable to intangible assets that cannot be recognized separately as identifiable assets under US GAAP, and comprise (a) the assembled work force and (b) the expected but unidentifiable business growth as a result of the synergy resulting from the acquisition. | ||||||||
The following unaudited pro forma information summarizes the results of operations of the Group, as if the merger had occurred as of January 1, 2011. The following pro forma financial information is not necessarily indicative of the results that would have occurred had the acquisition been completed at the beginning of the periods indicated, nor is it indicative of future operating results: | ||||||||
Years ended December 31, | ||||||||
2011 | 2012 | |||||||
(Unaudited) | (Unaudited) | |||||||
Net revenues | $ | 502,126 | $ | 673,266 | ||||
Net income/(loss) | 39,532 | 1,807 | ||||||
Net income/(loss) per share | ||||||||
—Basic | $ | 0.47 | $ | 0.02 | ||||
| | | | | | | | |
| | | | | | | | |
—Diluted | $ | 0.45 | $ | 0.02 | ||||
| | | | | | | | |
| | | | | | | | |
The pro forma results of operations give effect to certain adjustments, including amortization of acquired intangible assets with finite lives, associated with the acquisition. There are no nonrecurring pro forma adjustments directly attributable to the business combination. | ||||||||
(l) | ||||||||
Acquisition of non-controlling interest in Pactera Financial Solutions | ||||||||
As a result of the merger of equals with VanceInfo, the Group has a subsidiary named Pactera Financial Solutions Limited ("Pactera Financial Solutions"). Under the previous contractual agreement between VanceInfo and Pactera Financial Solutions, VanceInfo granted 33.3% equity interest or 1,000,000 common shares of Pactera Financial Solutions in the form of nonvested shares to key employees for their continuing employment. | ||||||||
On January 1, 2013, the Group acquired 33.3% of the equity interest in Pactera Financial Solutions held by the key employees with a total consideration of $6,294, of which $2,773 were paid in cash and $227 were paid through vested nonvested shares. The remaining consideration $3,294 is subject to the Pactera Financial Solutions' financial performance for the years ending December 31, 2013 through 2015. | ||||||||
(m) | ||||||||
Other acquisitions | ||||||||
The Group also made following acquisitions during the years ended December 31, 2011: | ||||||||
1 | ||||||||
On April 1, 2011, the Group acquired substantially all of the business and assets of iConnect ("iConnect Business"), a U.S.-based development and testing services provider, with consideration of: | ||||||||
• | ||||||||
Cash consideration of $400 to be paid upon closing; | ||||||||
• | ||||||||
Contingent consideration of $306 paid in 2011. | ||||||||
2 | ||||||||
On April 1, 2011, the Group acquired substantially all of the business and assets of Shanghai Yuetong ("Shanghai Yuetong Business"), a China-based development and testing services provider, with consideration of: | ||||||||
• | ||||||||
Cash consideration of $600 to be paid upon closing; | ||||||||
• | ||||||||
Contingent consideration of $459 paid in 2012. | ||||||||
3 | ||||||||
On June 1, 2011, the Group acquired substantially all of the business and assets of Ascent ("Ascent Business"), a China-based professional technical training services provider, with consideration of: | ||||||||
• | ||||||||
Cash consideration of $245 to be paid upon closing; | ||||||||
• | ||||||||
Contingent consideration of up to $227 based on the financial performance of Ascent Business from July 2011 to June 2014. | ||||||||
RESTRICTED_CASH
RESTRICTED CASH | 12 Months Ended |
Dec. 31, 2013 | |
RESTRICTED CASH | ' |
RESTRICTED CASH | ' |
4. RESTRICTED CASH | |
The balance of restricted cash of $6,112 and $1,067 as of December 31, 2012 and 2013, respectively, consisted of the following: | |
1 | |
$808 and $94 as of December 31, 2012 and 2013, respectively, were deposit of forward foreign currency exchange transactions are considered restricted; | |
2 | |
$648 and $657 as of December 31, 2012 and 2013, respectively, were deposit of Letter of Guarantee for a project; | |
3 | |
$210 and $203 as of December 31, 2012 and 2013, respectively, were used to secure bank letter of guarantee for facility rentals in Singapore and Spain; | |
4 | |
$2,812 and $83 as of December 31, 2012 and 2013, respectively, were deposits of bank bills; | |
5 | |
$1,605 and nil as of December 31, 2012 and 2013, respectively, were pledged deposit for short-term bank loan. This pledged deposit was subsequently released in January 2013; and | |
6 | |
$29 and $30 as of December 31, 2012 and 2013, respectively, were deposits to secure commercial card issued by bank. | |
SHORTTERM_INVESTMENT
SHORT-TERM INVESTMENT | 12 Months Ended |
Dec. 31, 2013 | |
SHORT-TERM INVESTMENT | ' |
SHORT-TERM INVESTMENT | ' |
5. SHORT-TERM INVESTMENT | |
Short-term investment is the held-to-maturity securities purchased in December 2012. As of December 31, 2012, the Company's held-to-maturity securities carried at amortized cost of $1,765. The held-to-maturity securities are not allowed to be redeemed early before its maturity. The carrying amounts of the held-to-maturity securities approximate their fair value due to their short-term nature, which are within one-year maturity period. The short-term investment was matured in year 2013. | |
ACCOUNTS_RECEIVABLE
ACCOUNTS RECEIVABLE | 12 Months Ended | ||||||||||
Dec. 31, 2013 | |||||||||||
ACCOUNTS RECEIVABLE | ' | ||||||||||
ACCOUNTS RECEIVABLE | ' | ||||||||||
6. ACCOUNTS RECEIVABLE | |||||||||||
Accounts receivable, net consists of: | |||||||||||
As of December 31, | |||||||||||
2012 | 2013 | ||||||||||
Billed receivable | $ | 106,882 | $ | 98,421 | |||||||
Unbilled receivable | 140,197 | 161,675 | |||||||||
| | | | | | | | ||||
247,079 | 260,096 | ||||||||||
Less: Allowance for doubtful accounts | 16,386 | 13,646 | |||||||||
| | | | | | | | ||||
$ | 230,693 | $ | 246,450 | ||||||||
| | | | | | | | ||||
| | | | | | | | ||||
Revenue in excess of billings is recorded as unbilled receivable and included in accounts receivable. These amounts become billable according to the contract terms. | |||||||||||
Movement of the allowance for doubtful accounts is as follows: | |||||||||||
As of December 31, | |||||||||||
2011 | 2012 | 2013 | |||||||||
Balance at the beginning of the year | $ | 3,698 | $ | 4,002 | $ | 16,386 | |||||
Balance brought forward from VanceInfo | — | 10,197 | — | ||||||||
Allowance for doubtful accounts | 477 | 5,153 | 343 | ||||||||
Write-off | (388 | ) | (2,751 | ) | (2,978 | ) | |||||
Foreign currency translation adjustments | 215 | (215 | ) | (105 | ) | ||||||
| | | | | | | | | | | |
Balance at the end of the year | $ | 4,002 | $ | 16,386 | $ | 13,646 | |||||
| | | | | | | | | | | |
| | | | | | | | | | | |
PREPAID_EXPENSES_AND_OTHER_CUR
PREPAID EXPENSES AND OTHER CURRENT ASSETS | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
PREPAID EXPENSES AND OTHER CURRENT ASSETS | ' | |||||||
PREPAID EXPENSES AND OTHER CURRENT ASSETS | ' | |||||||
7. PREPAID EXPENSES AND OTHER CURRENT ASSETS | ||||||||
As of December 31, | ||||||||
2012 | 2013 | |||||||
Prepaid rent and other prepaid expenses | $ | 8,467 | $ | 11,258 | ||||
Advances to suppliers | 2,449 | 2,969 | ||||||
Deposits | 1,213 | 2,031 | ||||||
Accrued interests receivable | 793 | 717 | ||||||
Advances to employees | 1,055 | 680 | ||||||
Prepayment for building and property | 13,283 | — | ||||||
Other current assets | 1,235 | 1,007 | ||||||
| | | | | | | | |
Total | $ | 28,495 | $ | 18,662 | ||||
| | | | | | | | |
| | | | | | | | |
Prepayment for building and property as of December 31, 2012 was for the purchase of a facility in Wuxi State Hi-Tech Zone, which represented approximately 60% of the total purchase consideration. The remaining consideration of $9,004 was paid in July 2013. The total prepayment for Wuxi facility was transferred to property, plant and equipment as of December 31, 2013. | ||||||||
ASSETS_HELD_FOR_SALE
ASSETS HELD FOR SALE | 12 Months Ended |
Dec. 31, 2013 | |
ASSETS HELD FOR SALE | ' |
ASSETS HELD FOR SALE | ' |
8. ASSETS HELD FOR SALE | |
On December 27, 2013, the Group and Chinasoft International Limited and its affiliates ("Chinasoft") entered into several agreements, under which the Group would sell the Huawei related certain uncompleted business contracts and property, plant and equipment and leases, procured the transfer of relevant project teams to ChinaSoft, and agreed that the Group will not provide similar services to Huawei in coming two years. The details of the transaction are disclosed in Note 23 (b). As a part of the transaction, the Group would sell certain property, plant and equipment with net carrying values of $2,855. The transaction was completed in January 2014. These assets were written down to $2,589, the estimated fair value less estimated cost to sell and were classified as assets held for sale as of December 31, 2013. A loss from impairment of assets held for sale of $266 was recognized in year ended December 31, 2013. | |
PROPERTY_PLANT_AND_EQUIPMENT_N
PROPERTY, PLANT AND EQUIPMENT, NET | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
PROPERTY, PLANT AND EQUIPMENT, NET | ' | |||||||
PROPERTY, PLANT AND EQUIPMENT, NET | ' | |||||||
9. PROPERTY, PLANT AND EQUIPMENT, NET | ||||||||
As of December 31, | ||||||||
2012 | 2013 | |||||||
Construction in progress | $ | 36,797 | $ | — | ||||
Building | — | 76,458 | ||||||
Furniture, fixtures, electronic equipment and software | 47,591 | 45,320 | ||||||
Transportation equipment | 2,281 | 2,245 | ||||||
Leasehold improvements | 25,209 | 15,849 | ||||||
| | | | | | | | |
111,878 | 139,872 | |||||||
Less: Accumulated depreciation | 44,271 | 44,041 | ||||||
| | | | | | | | |
$ | 67,607 | $ | 95,831 | |||||
| | | | | | | | |
| | | | | | | | |
Depreciation expenses for the years ended December 31, 2011, 2012 and 2013 were $4,400, $6,850 and $13,670, respectively. | ||||||||
GOODWILL
GOODWILL | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
GOODWILL | ' | |||||||
GOODWILL | ' | |||||||
10. GOODWILL | ||||||||
The changes in the carrying amount of goodwill during the years ended December 31, 2012 and 2013 are as follows: | ||||||||
As of December 31 | ||||||||
2012 | 2013 | |||||||
Balance at the beginning of the year | $ | 37,348 | $ | 102,659 | ||||
Goodwill acquired in business acquisitions | 64,785 | — | ||||||
Foreign currency translation adjustments | 526 | (437 | ) | |||||
| | | | | | | | |
Balance at the end of the year | $ | 102,659 | $ | 102,222 | ||||
| | | | | | | | |
| | | | | | | | |
As of December 31, 2012, the Group determined it had two reporting units after the merger of equals with VanceInfo on November 9, 2012. Subsequent to the merger of equals with VanceInfo, the Group embarked on an integration process. In the early 2013, the integration process of former VanceInfo and HiSoft had been completed as the Group had successfully integrated the financial system, business groups, and other support departments. As a result, the management determined that the Group had one reporting unit as of December 31, 2013. | ||||||||
The Group performs its annual impairment test for goodwill on December 31 of each year. Based on the results of the impairment test, there is no impairment charge for the years ended December 31, 2011, 2012 and 2013, respectively. | ||||||||
INTANGIBLE_ASSETS
INTANGIBLE ASSETS | 12 Months Ended | ||||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||||
INTANGIBLE ASSETS | ' | ||||||||||||||||||||||
INTANGIBLE ASSETS | ' | ||||||||||||||||||||||
11. INTANGIBLE ASSETS | |||||||||||||||||||||||
Intangible assets and their related accumulated amortization as of December 31, 2012 and 2013 were as follows: | |||||||||||||||||||||||
Contract | Customer | Trade | Trademark | Non-compete | Software | Total | |||||||||||||||||
backlog | base and | name | agreement | technology | |||||||||||||||||||
customer | |||||||||||||||||||||||
relationship | |||||||||||||||||||||||
Balance as of January 1, 2012 | $ | 790 | $ | 8,964 | $ | 2,073 | $ | 3,026 | $ | 345 | $ | — | $ | 15,198 | |||||||||
Acquisition | 1,470 | 15,200 | 29,989 | 513 | 1,887 | 2,459 | 51,518 | ||||||||||||||||
Amortization | (1,611 | ) | (3,400 | ) | (428 | ) | (157 | ) | (225 | ) | (237 | ) | (6,058 | ) | |||||||||
Impairment | — | — | (2,836 | ) | (2,679 | ) | — | — | (5,515 | ) | |||||||||||||
Foreign currency translation adjustments | 3 | 54 | 84 | 9 | 10 | — | 160 | ||||||||||||||||
| | | | | | | | | | | | | | | | | | | | | | | |
Balance as of December 31, 2012 | 652 | 20,818 | 28,882 | 712 | 2,017 | 2,222 | 55,303 | ||||||||||||||||
Amortization | (572 | ) | (5,420 | ) | (2,590 | ) | (694 | ) | (682 | ) | (476 | ) | (10,434 | ) | |||||||||
Foreign currency translation adjustments | 1 | (279 | ) | 22 | (18 | ) | 17 | — | (257 | ) | |||||||||||||
| | | | | | | | | | | | | | | | | | | | | | | |
Balance as of December 31, 2013 | $ | 81 | $ | 15,119 | $ | 26,314 | $ | — | $ | 1,352 | $ | 1,746 | $ | 44,612 | |||||||||
| | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
Gross carrying amount | |||||||||||||||||||||||
Balance as of December 31, 2012 | $ | 3,143 | $ | 26,390 | $ | 29,388 | $ | 877 | $ | 2,246 | $ | 2,459 | $ | 64,503 | |||||||||
Balance as of December 31, 2013 | $ | 3,143 | $ | 26,390 | $ | 29,388 | $ | 877 | $ | 2,246 | $ | 2,459 | $ | 64,503 | |||||||||
| | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
Accumulated amortization | |||||||||||||||||||||||
Balance as of December 31, 2012 | $ | 2,491 | $ | 5,572 | $ | 506 | $ | 165 | $ | 229 | $ | 237 | $ | 9,200 | |||||||||
Balance as of December 31, 2013 | $ | 3,062 | $ | 11,271 | $ | 3,074 | $ | 877 | $ | 894 | $ | 713 | $ | 19,891 | |||||||||
| | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
The Group recorded amortization expenses of $2,677, $6,058 and $10,434 in 2011, 2012 and 2013, respectively. | |||||||||||||||||||||||
The Group expects to record amortization expenses of $8,666, $6,824, $5,414, $3,837 and $4,028 for the year 2014, 2015, 2016, 2017, 2018 and thereafter, respectively. | |||||||||||||||||||||||
Consequential to the merger of equals with VanceInfo, the Group has written down the trademarks and trade names of $5,515 for the year ended December 31, 2012 as management determined not to use certain trademarks and trade names after the merger. | |||||||||||||||||||||||
LONGTERM_INVESTMENT
LONG-TERM INVESTMENT | 12 Months Ended |
Dec. 31, 2013 | |
LONG-TERM INVESTMENT | ' |
LONG-TERM INVESTMENT | ' |
12. LONG-TERM INVESTMENT | |
Equity method investment | |
In February 2012, VanceInfo acquired 100% equity interest in Sunwin, a China-based company providing IT consulting and solutions to companies in Chinese airline industry. Sunwin has a 50% equity interest in a PRC joint venture company, Beijing Yunxiang Weiye Information Technology Co., Ltd. Such equity interest was also acquired as part of the merger with VanceInfo. The investment has been recorded using the equity method of accounting because the Group has the ability to exercise significant influence over the operating and financing activities of the investee but does not have control over it. | |
The investment earnings generated from the equity method investment for the years ended December 31, 2011, 2012 and 2013 were nil, $23 and $68, respectively. | |
LAND_USE_RIGHT
LAND USE RIGHT | 12 Months Ended |
Dec. 31, 2013 | |
LAND USE RIGHT | ' |
LAND USE RIGHT | ' |
13. LAND USE RIGHT | |
The land use right was acquired as a result of the merger with VanceInfo. The Group recorded the land use right at fair value of $24,393 at the acquisition date as a part of the purchase price allocation and amortizes the cost of land use right on a straight-line basis over the remaining useful life of 49 years. | |
The Group recorded amortization expenses of nil, $71 and $509, respectively, for the years ended December 31, 2011, 2012 and 2013. | |
ACCRUED_EXPENSES_AND_OTHER_PAY
ACCRUED EXPENSES AND OTHER PAYABLES | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
ACCRUED EXPENSES AND OTHER PAYABLES | ' | |||||||
ACCRUED EXPENSES AND OTHER PAYABLES | ' | |||||||
14. ACCRUED EXPENSES AND OTHER PAYABLES | ||||||||
As of December 31, | ||||||||
2012 | 2013 | |||||||
Employee payroll and welfare payables | $ | 47,697 | $ | 56,008 | ||||
Accrued other operating expenses | 6,074 | 12,501 | ||||||
Other employee welfare payables | 9,148 | 9,307 | ||||||
Subcontractors fees | 7,507 | 8,525 | ||||||
Advance from customers | 7,662 | 5,546 | ||||||
Accrued privatization related cost | — | 5,514 | ||||||
Amounts payable for construction of building | — | 5,120 | ||||||
Accrued merger related cost | 12,290 | 3,886 | ||||||
Advance from transfer of | ||||||||
certain outsourcing business (Note 23) | — | 3,764 | ||||||
Accrued professional fees | 2,136 | 2,345 | ||||||
Accrued travel expenses | 2,262 | 1,192 | ||||||
Accrued rental expenses | 2,815 | 949 | ||||||
Government grant payable | 42 | 796 | ||||||
Deferred revenue | 632 | 385 | ||||||
Amount due to a related party | 136 | — | ||||||
Other payable | 4,643 | 5,920 | ||||||
| | | | | | | | |
Total | $ | 103,044 | $ | 121,758 | ||||
| | | | | | | | |
| | | | | | | | |
Accrued other operating expenses mainly comprised of accrued employee related reimbursement expenses and other accrued operating expenses. | ||||||||
Accrued merger related costs as of December 31, 2012 and 2013 were mainly related to the severance costs payable, professional fee payables to the third-parties service organizations and rental termination payable to the lessors with VanceInfo. | ||||||||
Accrued privatization related costs as of December 31 2013 was mainly related to the professional fee payables to the third party service organizations in relation to the going private transaction as disclosed in Note 23 (a). | ||||||||
FAIR_VALUE
FAIR VALUE | 12 Months Ended | |||||||||||||
Dec. 31, 2013 | ||||||||||||||
FAIR VALUE | ' | |||||||||||||
FAIR VALUE | ' | |||||||||||||
15. FAIR VALUE | ||||||||||||||
(a) | ||||||||||||||
Assets and liabilities measured at fair value on a recurring basis | ||||||||||||||
The Group measured its financial assets and liabilities, including cash equivalents, term deposits, restricted cash, short-term investment, accounts receivable, accounts payable, foreign currency forward contracts and contingent consideration on a recurring basis as of December 31, 2012 and 2013. Cash equivalents, term deposits, restricted cash and short-term investment are classified within Level 1 of the fair value hierarchy because they are valued based on the quoted market price in an active market. The carrying amounts of accounts receivable and accounts payable approximate their fair values due to their short-term maturity. | ||||||||||||||
Foreign currency forward contracts | ||||||||||||||
The Group purchased foreign currency forward contracts to protect against the adverse effect that exchange rate fluctuation may have on foreign currency denominated sales activities. Foreign currency forward contracts are marked to market based on the prevailing forward exchange rate quoted by the contracted bank (Level 2 inputs). Assets and liabilities resulted from foreign currency forward contracts are recorded at its fair value. | ||||||||||||||
As of December 31, 2012 and 2013, the fair value of foreign currency forward contracts, which amounted to $8 and $14, respectively, is recorded in prepaid expenses and other current assets. During the years of 2011, 2012 and 2013, gains and losses on the foreign currency forward contracts are recognized in the consolidated statements of operations. | ||||||||||||||
Details of the outstanding foreign currency forward contracts as of December 31, 2012 and 2013 were as follows: | ||||||||||||||
As of December 31, | ||||||||||||||
2012 | 2013 | |||||||||||||
Settlement currency in: | ||||||||||||||
U.S. dollar of entity with functional currency in RMB | ||||||||||||||
Notional contract amount (U.S. dollar) | $1,800 | $ | 1,800 | |||||||||||
| | | | | | | ||||||||
| | | | | | | ||||||||
Contingent consideration | ||||||||||||||
The contingent consideration in connection with the acquisitions of Beans, NouvEON, HURO, Logoscript, Longhaul, Glory, Bearing Point, Newton, Pactera Jinxin, Beijing DPC, Pactera Australia, Lifewood, Beijing Viatt, TP, Sunwin and Pactera Financial Solutions determined at fair value based on, among other factors, forecast financial performance of the acquired business, and discount rate (Level 3 inputs). | ||||||||||||||
The Group estimates and records the acquisition date estimated fair value of contingent consideration as part of purchase price consideration for acquisitions. Additionally, at the end of each reporting period, the Group calculates the changes in the fair value of contingent consideration, and recognizes such changes in the consolidated statements of operations. | ||||||||||||||
An increase in the earn-out expected to be paid will result in a charge to operations in the period that the anticipated fair value of contingent consideration increases, while a decrease in the earn-out expected to be paid will result in a credit to operations in the period that the anticipated fair value of contingent consideration decreases. The estimate of the fair value of contingent consideration requires subjective assumptions to be made of future operating results, discount rates, and timing of earn-out payments. Future revisions to these assumptions could materially change the estimate of the fair value of contingent consideration and, therefore, materially affect the Group's future financial results. | ||||||||||||||
The fair value measurement of the contingent consideration encompasses the following significant unobservable inputs: | ||||||||||||||
Unobservable Inputs | Range | |||||||||||||
Estimated contingent consideration payments | $32 – $4,045 | |||||||||||||
Discount rate | 1.55% – 11.70% | |||||||||||||
Timing of cash flows | 0.17 – 2.17 years | |||||||||||||
The following table summarizes the movement of the Group's contingent consideration measured at fair value on recurring basis for the year ended December 31, 2013: | ||||||||||||||
Contingent consideration as of January 1, 2012 | $ | 18,552 | ||||||||||||
Assumed from the merger with VanceInfo | 16,775 | |||||||||||||
Increase in contingent consideration as a result of business acquisitions | 20,355 | |||||||||||||
Less: Payments made during 2012 | (3,047 | ) | ||||||||||||
Shares issuable in connection with business acquisition | (918 | ) | ||||||||||||
Add: Changes in fair values | (659 | ) | ||||||||||||
Foreign currency translation adjustments | 361 | |||||||||||||
| | | | | ||||||||||
Contingent consideration as of January 1, 2013 | $ | 51,419 | ||||||||||||
Increase in contingent consideration as a result of business acquisitions | 3,294 | |||||||||||||
Less: Cash payments made during 2013 | (22,661 | ) | ||||||||||||
Settlement by issuance of common shares | (3,203 | ) | ||||||||||||
Add: Changes in fair values | (1,164 | ) | ||||||||||||
Foreign currency translation adjustments | (190 | ) | ||||||||||||
| | | | | ||||||||||
Contingent consideration as of December 31, 2013 | $ | 27,495 | ||||||||||||
| | | | | ||||||||||
| | | | | ||||||||||
Including | ||||||||||||||
Current portion of contingent consideration | $ | 23,456 | ||||||||||||
Non-current portion of contingent consideration | $ | 4,039 | ||||||||||||
Fair Value Measurement at Reporting Date Using | ||||||||||||||
Description | December, 31 | Quoted Prices | Other | Significant | ||||||||||
2012 | in Active | Observable | Unobservable | |||||||||||
Market for | Inputs | Inputs | ||||||||||||
Identical | ||||||||||||||
Liabilities | ||||||||||||||
(Level 1) | (Level 2) | (Level 3) | ||||||||||||
Contingent consideration | $ | (51,419 | ) | — | $ | — | $ | (51,419 | ) | |||||
Foreign currency forward contracts | 8 | — | 8 | — | ||||||||||
| | | | | | | | | | | | | | |
Total | $ | (51,411 | ) | — | $ | 8 | $ | (51,419 | ) | |||||
| | | | | | | | | | | | | | |
| | | | | | | | | | | | | | |
Fair Value Measurement at Reporting Date Using | ||||||||||||||
Description | December, 31 | Quoted Prices | Other | Significant | ||||||||||
2013 | in Active | Observable | Unobservable | |||||||||||
Market for | Inputs | Inputs | ||||||||||||
Identical | ||||||||||||||
Liabilities | ||||||||||||||
(Level 1) | (Level 2) | (Level 3) | ||||||||||||
Contingent consideration | $ | (27,495 | ) | — | $ | — | $ | (27,495 | ) | |||||
Foreign currency forward contracts | 14 | — | 14 | — | ||||||||||
| | | | | | | | | | | | | | |
Total | $ | (27,481 | ) | — | $ | 14 | $ | (27,495 | ) | |||||
| | | | | | | | | | | | | | |
| | | | | | | | | | | | | | |
(b) | ||||||||||||||
Assets and liabilities measured at fair value on a nonrecurring basis | ||||||||||||||
The Group's financial assets and liabilities measured at fair value on a non-recurring basis include acquired assets and liabilities in connection with business acquisitions based on Level 3 inputs. | ||||||||||||||
The Group measured the fair value of the purchased intangible assets using the "income approach—relief from royalty" and "income approach—excess earnings" valuation methods. These acquired intangible assets are considered Level 3 assets and liabilities because the Group used unobservable inputs, such as forecast financial performance of the acquired business and discount rates, to determine the fair value of these purchased assets and liabilities. In 2012, an impairment loss of $5,515 was recognized for certain trade names as the Company decided not to use these brands after the merger with VanceInfo. | ||||||||||||||
The fair value was determined using models with significant unobservable inputs, Level 3 inputs, primarily the discounted future cash flow. Goodwill, other intangible assets and equity method investment are measured at fair value on a non-recurring basis and they are recorded at fair value only when impairment is recognized. | ||||||||||||||
The fair value measurements of the intangible assets encompass the following significant unobservable inputs: | ||||||||||||||
Unobservable Inputs | Range | |||||||||||||
Estimated net revenues | $1,400 – $30,316 | |||||||||||||
Royalty savings | 2% – 4% | |||||||||||||
Discount rate | 16% | |||||||||||||
Timing of cash flows | 1 – 2 years |
INCOME_TAXES
INCOME TAXES | 12 Months Ended | |||||||||||||
Dec. 31, 2013 | ||||||||||||||
INCOME TAXES | ' | |||||||||||||
INCOME TAXES | ' | |||||||||||||
16. INCOME TAXES | ||||||||||||||
The current and deferred components of income tax expense are as follows: | ||||||||||||||
Years ended December 31, | ||||||||||||||
2011 | 2012 | 2013 | ||||||||||||
Current tax expense | ||||||||||||||
—PRC and Hong Kong | $ | 968 | $ | 5,295 | $ | 5,404 | ||||||||
—Japan | 78 | 41 | 61 | |||||||||||
—U.S. | 330 | 10 | 299 | |||||||||||
—Singapore | 1,006 | 670 | 515 | |||||||||||
—Australia | — | 91 | 1,239 | |||||||||||
—Europe | — | — | 67 | |||||||||||
| | | | | | | | | | | ||||
2,382 | 6,107 | 7,585 | ||||||||||||
| | | | | | | | | | | ||||
Deferred tax expense (benefit) | ||||||||||||||
—PRC and Hong Kong | (881 | ) | (2,070 | ) | (293 | ) | ||||||||
—Japan | (42 | ) | (102 | ) | (802 | ) | ||||||||
—U.S. | 241 | (2,486 | ) | (1,181 | ) | |||||||||
—Singapore | 18 | (81 | ) | (276 | ) | |||||||||
—Australia | — | (155 | ) | 226 | ||||||||||
—Europe | — | (3 | ) | (291 | ) | |||||||||
| | | | | | | | | | | ||||
(664 | ) | (4,897 | ) | (2,617 | ) | |||||||||
| | | | | | | | | | | ||||
Income tax expense | $ | 1,718 | $ | 1,210 | $ | 4,968 | ||||||||
| | | | | | | | | | | ||||
| | | | | | | | | | | ||||
Cayman Islands | ||||||||||||||
Pactera International and VanceInfo are tax-exempted companies incorporated in the Cayman Islands and are not subject to tax on income or capital gains. | ||||||||||||||
British Virgin Islands | ||||||||||||||
Pactera BVI and Pactera Financial Solutions are exempted from income tax in the British Virgin Islands where they were incorporated. | ||||||||||||||
Hong Kong | ||||||||||||||
Pactera Systems Hong Kong, Pactera Hong Kong, TP Teleservices, TP Hong Kong, TP Consultants, TP Taiwan, Pactera Financial Service, Lifewood Technology and Lifewood Data were established in Hong Kong and subject to the Hong Kong profit tax rate at 16.5% for the years ended December 31, 2011, 2012 and 2013. | ||||||||||||||
Japan | ||||||||||||||
Pactera Japan and ISL were established in Japan and are subject to Japanese income taxes at 42%. | ||||||||||||||
Singapore | ||||||||||||||
Pactera Singapore, AllianceSPEC and VanceInfo Singapore are subject to Singapore income taxes at the rate of 17%. | ||||||||||||||
The United States | ||||||||||||||
DMK International, Pactera NA, NouvEON, and Pactera US were established in the United States and are subject to the U.S. federal income taxes at gradual rates from 15% to 39% and state income taxes of 6%, 8.84%, 6.9% and 8.84%, respectively. | ||||||||||||||
Spain | ||||||||||||||
Pactera Spain was established in Spain and subject to the Spanish income tax at the rate of 30%. | ||||||||||||||
Australia | ||||||||||||||
Bearing Point and Pactera Australia were established in Australia and subject to corporate income tax at 30%. | ||||||||||||||
Malaysia | ||||||||||||||
Pactera Malaysia was established in Malaysia and subject to corporate income tax at 25%. | ||||||||||||||
Mauritius | ||||||||||||||
Pactera Mauritius was established in Mauritius and subject to corporate income tax at 15%. | ||||||||||||||
PRC | ||||||||||||||
The preferential tax rates, which are rates enjoyed by the PRC entities of the Group, different from the statutory rates of 25% for the years ended December 31, 2011, 2012 and 2013 are presented in the following table. | ||||||||||||||
Subsidiaries | 0% | 10% | 12.50% | 15% | ||||||||||
Pactera Dalian(1)(9) | — | 2011 – 2013 | — | — | ||||||||||
Pactera Shenzhen Systems(3) | — | — | — | 2011 – 2013 | ||||||||||
Pactera Chengdu(1) | — | — | — | 2011 – 2013 | ||||||||||
HiSoft Beijing(1) | — | — | — | 2011 – 2013 | ||||||||||
Pactera Wuxi(2) | 2011 | — | 2012 – 2013 | — | ||||||||||
HURO(1) | — | — | — | 2011 – 2013 | ||||||||||
Pactera Jinxin(1) | — | — | — | 2012 – 2013 | ||||||||||
Glory(1) | — | — | — | 2011 – 2013 | ||||||||||
Pactera Beijing(4) | — | 2011 – 2012 | — | 2013 | ||||||||||
Pactera Nanjing(5) | — | — | 2011 – 2013 | — | ||||||||||
Pactera Shenzhen(6) | 2011 | 2013 | 2012 | — | ||||||||||
Beijing DPC(7) | — | — | — | 2011 – 2013 | ||||||||||
Pactera Shanghai(8) | — | 2011 – 2012 | — | 2013 | ||||||||||
Sunwin(1) | — | — | — | 2012 – 2013 | ||||||||||
-1 | ||||||||||||||
The "High and New Technology Enterprise" (the "new HNTE") status obtained by Pactera Dalian, Pactera Chengdu, HiSoft Beijing, HURO and Glory in 2011, while Pactera Jinxin and Sunwin in 2012, under the Enterprise Income Tax Law (the "EIT Law") effective on January 1, 2008, are valid for three years and qualifying entities can re-apply for an additional three years provided their business operations continue to qualify for the new HNTE status. | ||||||||||||||
-2 | ||||||||||||||
Pactera Wuxi was certified as software enterprise in 2010. Starting from 2010, Pactera Wuxi is entitled to a two-year tax exemption followed by a three-year of 50% deduction of its income tax. | ||||||||||||||
-3 | ||||||||||||||
In 2010, Pactera Shenzhen Systems was certified as "Advanced Technology Service Enterprise" and entitled to an income tax rate of 15% from January 1, 2010 to December 31, 2013. | ||||||||||||||
-4 | ||||||||||||||
Pactera Beijing obtained the new HNTE in 2008 and the HNTE certificate was renewed in 2011. Pactera Beijing was further recognized as a "key software enterprise under the State plan" in 2012, which entitled it to a 10% preferential income tax rate in 2011 and 2012. For 2013, Pactera Beijing would enjoy the preferential income tax rate of 15% as HNTE. | ||||||||||||||
-5 | ||||||||||||||
Pactera Nanjing obtained the certificate of new setup software enterprise in 2009 and was entitled to an exemption of EIT from 2009 to 2010 and 50% reduction for the subsequent three years at the preferential tax rate of 12.5% from 2011 to 2013. | ||||||||||||||
-6 | ||||||||||||||
Pactera Shenzhen obtained the approved newly established IC design software enterprise and qualified software enterprise in 2010 and was entitled to an exemption of EIT in 2010 and 2011 and 50% reduction for the subsequent three years at the preferential tax rate of 12.5% from 2012 to 2014. It was further recognized as a "key software enterprise under the State plan" in 2013, which would entitle it to a 10% preferential income tax rate in 2013 and 2014. | ||||||||||||||
-7 | ||||||||||||||
Beijing DPC was qualified for the new HNTE and the certificate was renewed in 2012. As such, it is entitled to 15% tax rate from 2011 to 2013. | ||||||||||||||
-8 | ||||||||||||||
Pactera Shanghai was qualified as the new HNTE in December 2009, and was further recognized as a "key software enterprise under the State plan" in December 2009 and 2012, respectively, which entitled it to a 10% preferential income tax rate in 2009 through 2012. Pactera Shanghai obtained the advanced technology service enterprises certificate in 2010 and renewed the certificate in 2012, which makes it eligible for a 15% income tax rate in 2013. | ||||||||||||||
-9 | ||||||||||||||
Pactera Dalian was further recognized as a "key software enterprise under the State plan" in 2012 and 2013, respectively, which would entitle it to a 10% preferential income tax rate from 2011 to 2014. | ||||||||||||||
The principal components of the Group's deferred income tax assets and liabilities are as follows: | ||||||||||||||
Years ended December 31, | ||||||||||||||
2011 | 2012 | 2013 | ||||||||||||
Deferred tax assets | ||||||||||||||
Gross | $ | 5,949 | $ | 16,829 | $ | 17,681 | ||||||||
Less: Valuation allowance | (5,033 | ) | (4,596 | ) | (4,531 | ) | ||||||||
| | | | | | | | | | | ||||
Total net deferred tax assets | 916 | 12,233 | 13,150 | |||||||||||
| | | | | | | | | | | ||||
Deferred tax assets—current: | ||||||||||||||
Allowance for doubtful accounts | 1,954 | 2,742 | 1,667 | |||||||||||
Accrued expenses | 131 | 6,217 | 6,249 | |||||||||||
| | | | | | | | | | | ||||
Total deferred taxes assets—current | 2,085 | 8,959 | 7,916 | |||||||||||
Less: Valuation allowance | (1,462 | ) | (19 | ) | (130 | ) | ||||||||
| | | | | | | | | | | ||||
Net deferred tax assets—current, net | 623 | 8,940 | 7,786 | |||||||||||
| | | | | | | | | | | ||||
| | | | | | | | | | | ||||
Deferred tax assets—non-current: | ||||||||||||||
Net operating losses | 3,811 | 6,975 | 9,138 | |||||||||||
Depreciation | 53 | 895 | 627 | |||||||||||
| | | | | | | | | | | ||||
Total deferred taxes assets—non-current | 3,864 | 7,870 | 9,765 | |||||||||||
Less: Valuation allowance | (3,571 | ) | (4,577 | ) | (4,401 | ) | ||||||||
| | | | | | | | | | | ||||
Net deferred tax assets—non-current, net | 293 | 3,293 | 5,364 | |||||||||||
| | | | | | | | | | | ||||
Current deferred tax liabilities: | ||||||||||||||
Depreciation | (8 | ) | — | — | ||||||||||
Unbilled account receivables | — | (411 | ) | (352 | ) | |||||||||
| | | | | | | | | | | ||||
Current deferred tax liabilities | (8 | ) | (411 | ) | (352 | ) | ||||||||
| | | | | | | | | | | ||||
| | | | | | | | | | | ||||
Non-current deferred tax liabilities: | ||||||||||||||
Intangible assets | (3,017 | ) | (11,145 | ) | (9,312 | ) | ||||||||
Depreciation | (88 | ) | (116 | ) | (133 | ) | ||||||||
| | | | | | | | | | | ||||
Non-current deferred tax liabilities | $ | (3,105 | ) | $ | (11,261 | ) | $ | (9,445 | ) | |||||
| | | | | | | | | | | ||||
| | | | | | | | | | | ||||
The Group operates through multiple subsidiaries and the valuation allowance is considered on each individual subsidiary. The subsidiaries registered in the PRC have total net operating loss carry forwards of $2,907, $5,313 and $17,758 as of December 31, 2011, 2012 and 2013, respectively, which will expire on various dates between December 31, 2014 and December 31, 2018. The subsidiaries registered outside the PRC have total net operating loss carry forwards of $7,514, $21,503 and $21,436 as of December 31, 2011, 2012 and 2013, respectively, which will expire on various dates between December 31, 2024 and December 31, 2033. Valuation allowances have been established because the Group believes that either it is more likely than not that its deferred tax assets will not be realized as it does not expect to generate sufficient taxable income in future, or the amount involved is not significant. | ||||||||||||||
Reconciliation between income tax expense computed by applying the PRC tax rate to income before income tax and the income tax expense is as follows: | ||||||||||||||
Years ended December 31, | ||||||||||||||
2011 | 2012 | 2013 | ||||||||||||
Tax expenses at statutory tax rate in PRC | $ | 5,029 | $ | 1,128 | $ | 3,184 | ||||||||
Permanent differences | 551 | 314 | 695 | |||||||||||
Different tax jurisdictions | 306 | 3,253 | 6,556 | |||||||||||
Tax holiday in the PRC | (4,788 | ) | (3,102 | ) | (4,225 | ) | ||||||||
Change in valuation allowance | 861 | (437 | ) | (65 | ) | |||||||||
Preferential tax refund | — | — | (1,724 | ) | ||||||||||
Other | (241 | ) | 54 | 547 | ||||||||||
| | | | | | | | | | | ||||
Income tax expense | $ | 1,718 | $ | 1,210 | $ | 4,968 | ||||||||
| | | | | | | | | | | ||||
| | | | | | | | | | | ||||
If the above mentioned tax holidays granted to our PRC subsidiaries were not available, the Group's income tax expense would have increased by $4,788, $3,102 and $4,225 for the years ended December 31, 2011, 2012 and 2013, respectively. The impact of the tax holidays on basic net income per common share was an increase of $0.12, $0.06 and $0.06 and the impact on diluted net income per common share was an increase of $0.11, $0.06 and $0.05 for the years ended December 31, 2011, 2012 and 2013, respectively. | ||||||||||||||
The components of consolidated income before income tax expense as either domestic or foreign are as follows: | ||||||||||||||
Years ended December 31, | ||||||||||||||
2011 | 2012 | 2013 | ||||||||||||
Domestic (Cayman Islands) | $ | (7,125 | ) | $ | (22,937 | ) | $ | (26,246 | ) | |||||
Foreign (PRC) | 18,873 | 19,795 | 26,887 | |||||||||||
Foreign (Others) | 8,368 | 7,654 | 12,096 | |||||||||||
| | | | | | | | | | | ||||
Income before income tax expense | $ | 20,116 | $ | 4,512 | $ | 12,737 | ||||||||
| | | | | | | | | | | ||||
| | | | | | | | | | | ||||
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 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 EIT Law provide that non-resident legal entities will be considered the PRC residents if substantial and overall management and control over the manufacturing and business operations, personnel, accounting, properties, etc, 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 a resident enterprise, the Company and its subsidiaries registered outside the PRC will be subject to the PRC income tax at a rate of 25%. | ||||||||||||||
If the Company were to be non-resident for the PRC tax purpose, dividends paid to it out of profits earned after January 1, 2008 would be subject to a withholding tax. In the case of dividends paid by the PRC subsidiaries the withholding tax would be 10% and in the case of a subsidiary 25% or more directly owned by the resident in Hong Kong, the withholding tax would be 5%, but that is subject to the interpretation of Circular No. 601 issued by the State Administration of Taxation, under which the Company's Hong Kong subsidiary might not be considered to be the beneficial owner of any such dividends and in that case the withholding tax rate would be 10%. | ||||||||||||||
Aggregate undistributed earnings of the Company's subsidiaries located in the PRC that are available for distribution to the Company of approximately $79,611, $179,601 and $222,624 as of December 31, 2011, 2012 and 2013, respectively, are considered to be indefinitely reinvested and accordingly, no provision has been made for the Chinese dividend withholding taxes that would be payable upon the distribution of those amounts to the Company. The Chinese tax authorities have also clarified that distributions made out of pre January 1, 2008 retained earnings will not be subject to the withholding tax. It is not practical to determine the amount of any unrecognized deferred tax liability on those undistributed earnings. | ||||||||||||||
The Group is subject to taxation in the U.S. at federal and various states level and also foreign jurisdictions. There are no ongoing examinations by tax authorities at this time. The Group's various tax years from 2008 to 2013 remain open in various tax jurisdictions. | ||||||||||||||
COMMON_SHARES
COMMON SHARES | 12 Months Ended |
Dec. 31, 2013 | |
COMMON SHARES | ' |
COMMON SHARES | ' |
17. COMMON SHARES | |
In connection with the merger of equals with VanceInfo, the Company effected a 13.9482 to 1 common share consolidation and changed the ratio of the Company's ADSs representing common shares from one ADS for nineteen common shares to one ADS for one common share. As a result, the share data and the basic and diluted net income per share were adjusted retroactively for all periods presented. | |
In December 2012, the Company's board of directors had approved a share repurchase program, under which the Group was authorized, but was not obligated, to repurchase up to $30 million worth of outstanding ADSs representing the common shares of the Company from time to time over the next 12 months, depending on market conditions as well as subject to the relevant rules under US securities regulations. During 2013, 4,643,359 common shares had been repurchased for a total consideration of $30 million from the open market under this program. Subsequent to the repurchase of shares, the Company cancelled 2,900,000 common shares of the repurchased shares, and the remaining 1,743,359 common shares were reserved for future delivery to the employees upon exercise of vested share options or grant of nonvested shares. | |
During 2013, in connection with the acquisition consideration in Beijing DPC, Sunwin, and Pactera Financial Solutions, the Company issued 319,556 common shares as part of the earn-out payment for the business acquisition. | |
During 2013, 150,975 common shares were issued in connection with the vesting of nonvested shares previously granted under the Share Incentive Plan and 2011 Equity Incentive Plan. | |
The Company issued 1,075,406, 2,150,814 and 1,743,359 common shares in 2011, 2012 and 2013, respectively, for future delivery to the employees upon exercise of vested share options or grant of nonvested shares as set out in Note 18. | |
As of December 31, 2013, there was 85,503,321 common shares outstanding with a par value $0.00139482 per share. | |
SHAREBASED_COMPENSATION_PLAN
SHARE-BASED COMPENSATION PLAN | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||||||
SHARE-BASED COMPENSATION PLAN | ' | ||||||||||||||||||||||||
SHARE-BASED COMPENSATION PLAN | ' | ||||||||||||||||||||||||
18. SHARE-BASED COMPENSATION PLAN | |||||||||||||||||||||||||
Share Incentive Plan | |||||||||||||||||||||||||
On January 1, 2005, the Company's board of directors approved the Hisoft Technology International Limited. Share Incentive Plan ("Share Incentive Plan"). The maximum number of common shares that may be granted under this plan will not exceed 734,862 shares. In 2006, the Company's board of directors approved an additional 3,039,819 shares for grants under the Share Incentive Plan. In 2007, the Company's board of directors approved an additional 1,111,254 shares for grant. In 2008, the Company's board of directors approved an additional 290,213 shares for grant. In 2009, the Company's board of directors approved an additional 716,938 shares for grant. In March 2010, the Company's board of directors approved 716,938 shares pursuant to a special option plan. | |||||||||||||||||||||||||
2011 Equity Incentive Plan | |||||||||||||||||||||||||
On July 1, 2011, the Company's board of directors approved the Hisoft Technology International Limited 2011 Equity Incentive Plan ("2011 Equity Incentive Plan"). The total number of common shares that may be issued under this plan as of the effective date of this plan was 1,290,489. Upon the completion of the merger of equals with VanceInfo, the board of directors approved the First Amendment to Equity Incentive Plan ("Amended 2011 Equity Incentive Plan") and the total number of shares which may be issued under this plan was increased to 8,048,874, with an annual increase to be added on January 1 of each calendar year during the term of this plan, commencing from January 1, 2014, equal to the lesser of (i) 2.5% of the total number of shares issued and outstanding on December 31 of the immediately preceding calendar year, or (ii) a lesser number of shares determined by the Compensation Committee of the Company's board of directors, and subject to adjustment based on a change in the capital structure of the Company and other significant corporate events as specified in this Amended 2011 Equity Incentive Plan. In addition to the above maximum aggregate number of common shares may be issued under this plan, the Compensation Committee may authorize, grant and issue common shares and stock options pursuant to or in substitution for any options or other awards assumed in connection with any mergers or other acquisitions; provided that such grants comply with all applicable laws and the rules of any exchange on which the Company's common shares are traded. | |||||||||||||||||||||||||
As of December 31, 2013, the maximum number of common shares that may be delivered under this plan was 8,048,874 common shares and 6,501,435 options and nonvested shares have been granted to employees under this plan. | |||||||||||||||||||||||||
No options shall be exercisable after ten years from the date of grant. The options will vest first 1/2, 1/3 or 1/4 on a date specified in the option award agreement, which is usually a date approximately one year from the date of grant, and thereafter, 1/8, 1/12 or 1/16 respectively on each of the quarterly anniversaries from the first vesting date. | |||||||||||||||||||||||||
VanceInfo 2005 Stock Option Plan | |||||||||||||||||||||||||
Pursuant to the merger of equals with VanceInfo, the Group adopted the 2005 Stock Option Plan ("VanceInfo 2005 Stock Option Plan"), which brought forward from VanceInfo and allowed the Group to grant options to the former VanceInfo's employees and directors to purchase 1,867,500 common shares subject to vesting requirement. No options shall be exercisable after ten years from the date of grant. The options will vest first 1/4 on a date specified in the option award agreement, which is usually a date approximately 9 months or one year from the date of grant, and thereafter, 1/48 on each of the monthly anniversaries or 1/16 on each of the quarterly anniversaries from the first vesting date. As of December 31, 2013, 1,093,435 options and nonvested shares have been granted to employees under this plan. | |||||||||||||||||||||||||
VanceInfo 2007 Share Incentive Plan | |||||||||||||||||||||||||
The Group also adopted the 2007 Share Incentive Plan ("VanceInfo 2007 Share Incentive Plan"), which brought forward from VanceInfo and the Group authorized to grant to the former VanceInfo's employees and non-employees options to purchase common shares or nonvested shares up to a total of 1,100,000 common shares of the Company with an annual increase up to 3% of the number of common shares outstanding as of the first day of each year beginning 2008. The plan will expire on the tenth anniversary of the effective date of the plan. The term of any option granted under the 2007 Share Incentive Plan shall not exceed ten years. The options and nonvested shares will vest first 1/4 on the first anniversary of the date of grant and thereafter, 1/16 on each of the quarterly anniversaries or 1/4 on each of the anniversaries from the first vesting date. As of December 31, 2013, 2,049,611 options and nonvested shares have been granted to employees under this plan. | |||||||||||||||||||||||||
Termination of option | |||||||||||||||||||||||||
If the grantee ceases to be employed by or ceases to provide services to the Group, (a) the grantee will have until the date that is 30 days for termination with cause, 60 days for termination without cause, 6 months for death or disability after his or her severance date to exercise the options (or portion thereof) to the extent they were vested on the severance date; (b) the options, to the extent not vested on the severance date, shall terminate on the severance date. | |||||||||||||||||||||||||
Option exercise | |||||||||||||||||||||||||
The option shall be exercisable by the delivery of a written notice to the secretary of the Group, in the form approved by the Group, stating the number of common shares to be purchased pursuant to the option and payment in full for the exercise price of the shares to be purchased in cash, by check or by electronic funds transfer to the Group. | |||||||||||||||||||||||||
I. | |||||||||||||||||||||||||
Stock Options | |||||||||||||||||||||||||
Changes in options outstanding were as follows: | |||||||||||||||||||||||||
(i) | |||||||||||||||||||||||||
Share Incentive Plan | |||||||||||||||||||||||||
Number of | Weighted average | Weighted average | Weighted average | ||||||||||||||||||||||
share options | exercise price | grant-date | intrinsic value | ||||||||||||||||||||||
fair value | per option at the | ||||||||||||||||||||||||
grant dates | |||||||||||||||||||||||||
Share options outstanding as of January 1, 2011 | 4,508,784 | $ | 4.46 | ||||||||||||||||||||||
Granted | 114,685 | 16.74 | $ | 8.93 | — | ||||||||||||||||||||
Exercised | (1,007,740 | ) | 4.18 | ||||||||||||||||||||||
Cancelled | (217,539 | ) | 9.76 | ||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||
Share options outstanding as of December 31, 2011 | 3,398,190 | $ | 4.6 | ||||||||||||||||||||||
Granted | — | — | — | — | |||||||||||||||||||||
Exercised | (401,179 | ) | 4.34 | ||||||||||||||||||||||
Cancelled | (81,840 | ) | 6.64 | ||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||
Share options outstanding as of December 31, 2012 | 2,915,171 | $ | 4.58 | — | — | ||||||||||||||||||||
Granted | — | — | |||||||||||||||||||||||
Exercised | (691,372 | ) | 4.64 | ||||||||||||||||||||||
Cancelled | (83,608 | ) | 11.26 | ||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||
Share options outstanding as of December 31, 2013 | 2,140,191 | $ | 4.37 | ||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||
| | | | | | | | | | | | | | ||||||||||||
(ii) | |||||||||||||||||||||||||
2011 Equity Incentive Plan | |||||||||||||||||||||||||
Number of | Weighted average | Weighted average | Weighted average | ||||||||||||||||||||||
share options | exercise price | grant-date | intrinsic value | ||||||||||||||||||||||
fair value | per option at the | ||||||||||||||||||||||||
grant dates | |||||||||||||||||||||||||
Granted | 34,055 | $ | 8.79 | $ | 4.32 | — | |||||||||||||||||||
Exercised | — | — | |||||||||||||||||||||||
Cancelled | — | — | |||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||
Share options outstanding as of December 31, 2011 | 34,055 | $ | 8.79 | ||||||||||||||||||||||
Granted | 215,084 | $ | 7.25 | $ | 3.77 | — | |||||||||||||||||||
Exercised | — | — | |||||||||||||||||||||||
Cancelled | — | — | |||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||
Share options outstanding as of December 31, 2012 | 249,139 | $ | 7.46 | ||||||||||||||||||||||
Granted | 40,100 | $ | 7.75 | $ | 3.75 | — | |||||||||||||||||||
Exercised | — | — | |||||||||||||||||||||||
Cancelled | (43,623 | ) | $ | 8.2 | |||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||
Share options outstanding as of December 31, 2013 | 245,616 | $ | 7.38 | ||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||
| | | | | | | | | | | | | | ||||||||||||
The options vest ratably over one to four year period, which is generally the service period and exercisable over a period of ten years from the date of grant. | |||||||||||||||||||||||||
(iii) | |||||||||||||||||||||||||
VanceInfo 2005 Stock Option Plan | |||||||||||||||||||||||||
Number of | Weighted average | Weighted average | Weighted average | ||||||||||||||||||||||
share options | exercise price | grant-date | intrinsic value | ||||||||||||||||||||||
fair value | per option at the | ||||||||||||||||||||||||
grant dates | |||||||||||||||||||||||||
Assumed as of November 9, 2012 | 1,093,435 | $ | 1.9 | $ | 1.31 | $ | 6,118,710 | ||||||||||||||||||
Exercised | (61,340 | ) | $ | 0.78 | |||||||||||||||||||||
Cancelled | — | — | |||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||
Share options outstanding as of December 31, 2012 | 1,032,095 | $ | 1.97 | ||||||||||||||||||||||
Exercised | (223,715 | ) | $ | 1.78 | |||||||||||||||||||||
Cancelled | (1,588 | ) | $ | 6.95 | |||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||
Share options outstanding as of December 31, 2013 | 806,792 | $ | 2.01 | ||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||
| | | | | | | | | | | | | | ||||||||||||
(iv) | |||||||||||||||||||||||||
VanceInfo 2007 Share Incentive Plan | |||||||||||||||||||||||||
Number of | Weighted average | Weighted average | Weighted average | ||||||||||||||||||||||
share options | exercise price | grant-date | intrinsic value | ||||||||||||||||||||||
fair value | per option at the | ||||||||||||||||||||||||
grant dates | |||||||||||||||||||||||||
Assumed as of November 9, 2012 | 2,557,084 | $ | 7.56 | $ | 6.18 | $ | 1,138,653 | ||||||||||||||||||
Exercised | (25,908 | ) | $ | 5.53 | |||||||||||||||||||||
Cancelled | (49,088 | ) | $ | 7.96 | |||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||
Share options outstanding as of December 31, 2012 | 2,482,088 | $ | 7.57 | ||||||||||||||||||||||
Exercised | (111,844 | ) | $ | 5.3 | |||||||||||||||||||||
Cancelled | (458,385 | ) | $ | 7.87 | |||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||
Share options outstanding as of December 31, 2013 | 1,911,859 | $ | 7.63 | ||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||
| | | | | | | | | | | | | | ||||||||||||
Information with respect to options outstanding as of December 31, 2013 is as follows: | |||||||||||||||||||||||||
(i) | |||||||||||||||||||||||||
Share Incentive Plan | |||||||||||||||||||||||||
Options outstanding | Options exercisable | ||||||||||||||||||||||||
Number | Weighted | Weighted | Aggregate | Number | Weighted | Weighted | Aggregate | ||||||||||||||||||
outstanding | average | average | intrinsic | exercisable | average | average | intrinsic | ||||||||||||||||||
remaining | exercise | value | remaining | exercise | value | ||||||||||||||||||||
contractual | price | contractual | price | ||||||||||||||||||||||
life in years | life in years | ||||||||||||||||||||||||
2,140,191 | 3.4 | $ | 4.37 | $ | 6,013,406 | 2,134,557 | 3.39 | $ | 4.36 | $ | 6,008,441 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | | | | | ||
| | | | | | | | | | | | | | | | | | | | | | | | ||
In 2011, 2012 and 2013, 1,007,740, 401,179 and 691,372 options, respectively, were exercised. Total intrinsic value of options exercised in each of those years was $11,142, $ 1,881 and $1,226 in 2011, 2012 and 2013, respectively. | |||||||||||||||||||||||||
(ii) | |||||||||||||||||||||||||
2011 Equity Incentive Plan | |||||||||||||||||||||||||
Options outstanding | Options exercisable | ||||||||||||||||||||||||
Number | Weighted | Weighted | Aggregate | Number | Weighted | Weighted | Aggregate | ||||||||||||||||||
outstanding | average | average | intrinsic | exercisable | average | average | intrinsic | ||||||||||||||||||
remaining | exercise | value | remaining | exercise | value | ||||||||||||||||||||
contractual | price | contractual | price | ||||||||||||||||||||||
life in years | life in years | ||||||||||||||||||||||||
245,616 | 8.04 | $ | 7.38 | $ | 3,650 | 20,433 | 7.86 | $ | 8.79 | — | |||||||||||||||
| | | | | | | | | | | | | | | | | | | | | | | | ||
| | | | | | | | | | | | | | | | | | | | | | | | ||
In 2013, there was nil option being exercised under this plan and 20,433 options were exercisable as of December 31, 2013. | |||||||||||||||||||||||||
(iii) | |||||||||||||||||||||||||
VanceInfo 2005 Stock Option Plan | |||||||||||||||||||||||||
Options outstanding | Options exercisable | ||||||||||||||||||||||||
Number | Weighted | Weighted | Aggregate | Number | Weighted | Weighted | Aggregate | ||||||||||||||||||
outstanding | average | average | intrinsic | exercisable | average | average | intrinsic | ||||||||||||||||||
remaining | exercise | value | remaining | exercise | value | ||||||||||||||||||||
contractual | price | contractual | price | ||||||||||||||||||||||
life in years | life in years | ||||||||||||||||||||||||
806,792 | 2.3 | $ | 2.01 | $ | 4,153,648 | 806,792 | 2.3 | $ | 2.01 | $ | 4,153,648 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | | | | | ||
| | | | | | | | | | | | | | | | | | | | | | | | ||
In 2013, there were 223,715 options being exercised under this plan and 806,792 options were exercisable as of December 31, 2013. | |||||||||||||||||||||||||
(iv) | |||||||||||||||||||||||||
VanceInfo 2007 Share Incentive Plan | |||||||||||||||||||||||||
Options outstanding | Options exercisable | ||||||||||||||||||||||||
Number | Weighted | Weighted | Aggregate | Number | Weighted | Weighted | Aggregate | ||||||||||||||||||
outstanding | average | average | intrinsic | exercisable | average | average | intrinsic | ||||||||||||||||||
remaining | exercise | value | remaining | exercise | value | ||||||||||||||||||||
contractual | price | contractual | price | ||||||||||||||||||||||
life in years | life in years | ||||||||||||||||||||||||
1,911,859 | 2.64 | $ | 7.63 | $ | 567,787 | 1,316,968 | 2.25 | $ | 7.51 | $ | 537,201 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | | | | | ||
| | | | | | | | | | | | | | | | | | | | | | | | ||
In 2013, there were 111,844 options being exercised under this plan and 1,316,968 options were exercisable as of December 31, 2013. | |||||||||||||||||||||||||
A summary of the status of the Group's options to be vested as of December 31, 2011, 2012 and 2013 and changes during the years ended December 31, 2012 and 2013 is as below: | |||||||||||||||||||||||||
(i) | |||||||||||||||||||||||||
Share Incentive Plan | |||||||||||||||||||||||||
Options to be vested | Share options | Weighted-average | Weighted-average | ||||||||||||||||||||||
grant date | exercise price | ||||||||||||||||||||||||
fair value | per share | ||||||||||||||||||||||||
As of January 1, 2011 | 1,361,483 | $ | 2.51 | $ | 5.58 | ||||||||||||||||||||
Granted | 114,685 | 8.93 | 16.74 | ||||||||||||||||||||||
Vested | (704,248 | ) | 1.67 | 5.3 | |||||||||||||||||||||
Forfeited | (217,539 | ) | 4.18 | 9.76 | |||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
As of December 31, 2011 | 554,381 | $ | 4.88 | $ | 6.56 | ||||||||||||||||||||
Granted | — | — | — | ||||||||||||||||||||||
Vested | (357,282 | ) | 3.01 | 5.79 | |||||||||||||||||||||
Forfeited | (81,840 | ) | 9.21 | 6.64 | |||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
As of December 31, 2012 | 115,259 | $ | 7.63 | $ | 8.88 | ||||||||||||||||||||
Granted | — | — | — | ||||||||||||||||||||||
Vested | (26,017 | ) | 1.39 | (8.49 | ) | ||||||||||||||||||||
Forfeited | (83,608 | ) | 4.91 | 11.26 | |||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
As of December 31, 2013 | 5,634 | $ | 5.76 | $ | 8.47 | ||||||||||||||||||||
Vested and expect to vest as of December 31, 2013 | 4,593,188 | $ | 4.32 | ||||||||||||||||||||||
(ii) | |||||||||||||||||||||||||
2011 Equity Incentive Plan | |||||||||||||||||||||||||
Options to be vested | Share options | Weighted-average | Weighted-average | ||||||||||||||||||||||
grant date | exercise price | ||||||||||||||||||||||||
fair value | per share | ||||||||||||||||||||||||
Granted in 2011 | 34,055 | $ | 4.32 | $ | 8.79 | ||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
As of December 31, 2011 | 34,055 | $ | 4.32 | $ | 8.79 | ||||||||||||||||||||
Granted | 215,082 | 3.77 | 7.25 | ||||||||||||||||||||||
Vested | (34,055 | ) | 4.32 | 8.79 | |||||||||||||||||||||
Forfeited | 2 | 3.89 | 7.6 | ||||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
As of December 31, 2012 | 215,084 | $ | 3.77 | $ | 7.25 | ||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
Granted | 40,100 | 3.75 | 7.75 | ||||||||||||||||||||||
Forfeited | (30,001 | ) | 3.83 | 7.94 | |||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
As of December 31, 2013 | 225,183 | $ | 4.02 | $ | 7.25 | ||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
| | | | | | | | | | | |||||||||||||||
Vested and expect to vest as of December 31, 2013 | 245,616 | $ | 7.38 | ||||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
| | | | | | | | | | | |||||||||||||||
(iii) | |||||||||||||||||||||||||
VanceInfo 2005 Stock Option Plan | |||||||||||||||||||||||||
Options to be vested | Share options | Weighted-average | Weighted-average | ||||||||||||||||||||||
grant date | exercise price | ||||||||||||||||||||||||
fair value | per share | ||||||||||||||||||||||||
Assumed as of November 9, 2012 | 1,093,435 | $ | 1.31 | $ | 1.9 | ||||||||||||||||||||
Vested | (125 | ) | 1.71 | 3.5 | |||||||||||||||||||||
Forfeited | — | — | — | ||||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
As of December 31, 2012 | 1,093,310 | $ | 1.31 | $ | 1.9 | ||||||||||||||||||||
Vested | (1,093,310 | ) | 1.31 | 1.9 | |||||||||||||||||||||
Forfeited | — | — | — | ||||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
As of December 31, 2013 | — | — | — | ||||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
| | | | | | | | | | | |||||||||||||||
Vested and expect to vest as of December 31, 2013 | 1,093,435 | $ | 1.9 | ||||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
| | | | | | | | | | | |||||||||||||||
(iv) | |||||||||||||||||||||||||
VanceInfo 2007 Share Incentive Plan | |||||||||||||||||||||||||
Options to be vested | Share options | Weighted-average | Weighted-average | ||||||||||||||||||||||
grant date | exercise price | ||||||||||||||||||||||||
fair value | per share | ||||||||||||||||||||||||
Assumed as of November 9, 2012 | 2,557,084 | $ | 6.18 | $ | 7.56 | ||||||||||||||||||||
Vested | (81,381 | ) | 3.47 | 6.57 | |||||||||||||||||||||
Forfeited | (49,088 | ) | 8.35 | 7.96 | |||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
As of December 31, 2012 | 2,426,615 | $ | 6.23 | $ | 7.58 | ||||||||||||||||||||
Vested | (1,373,339 | ) | 8.32 | 8.09 | |||||||||||||||||||||
Forfeited | (458,385 | ) | 6.58 | 7.87 | |||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
As of December 31, 2013 | 594,891 | $ | 7.21 | $ | 7.9 | ||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
| | | | | | | | | | | |||||||||||||||
Vested and expect to vest as of December 31, 2013 | 2,049,611 | $ | 7.48 | ||||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
| | | | | | | | | | | |||||||||||||||
The fair value of each option granted was estimated on the date of grant by the Group and was determined using the Black-Scholes options-pricing model with the following assumptions, presented in weighted average, for the years ended December 31, 2011, 2012 and 2013, respectively, except for the options assumed under the merger of equals with VanceInfo on November 9, 2012: | |||||||||||||||||||||||||
2011 | 2012 | 2013 | |||||||||||||||||||||||
Expected volatility(1) | 53% | 53% | 50% – 51% | ||||||||||||||||||||||
Risk-free interest rate(2) | 1.44% – 2.90% | 1.04% | 1.18% – 1.23% | ||||||||||||||||||||||
Expected life (years)(3) | 5.5 – 6.1 | 6.5 | 5.87 – 6.11 | ||||||||||||||||||||||
Expected dividend yield(4) | — | — | — | ||||||||||||||||||||||
Exercise price(5) | $8.79 – $22.18 | $ | 7.25 | $6.42 – $7.94 | |||||||||||||||||||||
Fair value of the underlying common shares(6) | $8.79 – $22.18 | $ | 7.49 | $6.42 – $7.94 | |||||||||||||||||||||
-1 | |||||||||||||||||||||||||
Volatility | |||||||||||||||||||||||||
The volatility of the underlying common shares during the life of the options was estimated based on average historical volatility of comparable companies for the period before the valuation date with lengths equal to the expected terms of the options. | |||||||||||||||||||||||||
-2 | |||||||||||||||||||||||||
Risk-free interest rate | |||||||||||||||||||||||||
Risk free interest rate is estimated based on the yield to maturity of China international government bonds with maturity term close to expected term of the options. | |||||||||||||||||||||||||
-3 | |||||||||||||||||||||||||
Expected term | |||||||||||||||||||||||||
As the Group did not have historical share option exercise experience, it estimated the expected term based on a consideration of factors including contractual term, vesting period and empirical study on exercise behavior of employee share option. | |||||||||||||||||||||||||
-4 | |||||||||||||||||||||||||
Dividend yield | |||||||||||||||||||||||||
The dividend yield was estimated by the Group based on its expected dividend policy over the expected term of the options. | |||||||||||||||||||||||||
-5 | |||||||||||||||||||||||||
Exercise price | |||||||||||||||||||||||||
The exercise price of the options was determined by the Company's board of directors. | |||||||||||||||||||||||||
-6 | |||||||||||||||||||||||||
Fair value of underlying common shares | |||||||||||||||||||||||||
The fair value of the underlying common shares is estimated based on the closing market price of the ADS of the Company as of the grant date to derive the fair value of the common shares on that date. | |||||||||||||||||||||||||
The fair value of the options granted under the merger of equals with VanceInfo on November 9, 2012 was estimated with the assistance of an independent third-party appraiser, and was determined using binomial model with the following assumptions: | |||||||||||||||||||||||||
Expected volatility(1) | 52.0% – 66.0% | ||||||||||||||||||||||||
Risk-free interest rate(2) | 0.7% – 1.4% | ||||||||||||||||||||||||
Expected dividend yield(3) | Nil | ||||||||||||||||||||||||
Exercise price(4) | $4.58 – $11.00 | ||||||||||||||||||||||||
Fair value of the underlying common shares(5) | $7.49 | ||||||||||||||||||||||||
-1 | |||||||||||||||||||||||||
Volatility | |||||||||||||||||||||||||
The volatility of the underlying common shares during the life of the options was estimated based on average historical volatility of comparable companies for the period before the valuation date with lengths equal to the life of the options. | |||||||||||||||||||||||||
-2 | |||||||||||||||||||||||||
Risk-free interest rate | |||||||||||||||||||||||||
Risk free rate is estimated based on yield to maturity of China international government bonds with maturity term close to the life of the options. | |||||||||||||||||||||||||
-3 | |||||||||||||||||||||||||
Dividend yield | |||||||||||||||||||||||||
The dividend yield was estimated by the Group based on its expected dividend policy over the life of the options. | |||||||||||||||||||||||||
-4 | |||||||||||||||||||||||||
Exercise price | |||||||||||||||||||||||||
The exercise price of the options was determined by the Group's board of directors. | |||||||||||||||||||||||||
-5 | |||||||||||||||||||||||||
Fair value of underlying common shares | |||||||||||||||||||||||||
The fair value of the common shares underlying was estimated based on the closing market price of the ADS of VanceInfo as of the grant date to derive the fair value of the common shares on that date. | |||||||||||||||||||||||||
There was $1,375 of total unrecognized compensation expense related to share options granted as of December 31, 2013. The expense is expected to be recognized over a weighted-average period of 1.24 years according to the graded vesting schedule. | |||||||||||||||||||||||||
During 2013, the Company extended the contractual life of 281,804 fully vested share options held by 140 employees. As a result of that modification, the Company recognized additional compensation expense of $278 for the year ended December 31, 2013. | |||||||||||||||||||||||||
II. | |||||||||||||||||||||||||
Nonvested shares | |||||||||||||||||||||||||
The Group granted nonvested shares to its executives and senior management. Disposition of such shares are restricted, except in compliance with applicable securities laws. The closing market price of the ADS of the Company as of the grant date is used to derive the fair value of the nonvested shares on that date. | |||||||||||||||||||||||||
Similar to the options, the nonvested shares will vest first 1/2, 1/3 or 1/4 on a date specified in the share award agreement, which is usually a date approximately one year from the date of grant, and thereafter, 1/24, 1/36 or 1/48 respectively on each of the monthly anniversaries or 1/8, 1/12 or 1/16 respectively on each of the quarterly anniversaries from the first vesting date. | |||||||||||||||||||||||||
The following table summarizes information regarding the nonvested shares granted: | |||||||||||||||||||||||||
(i) | |||||||||||||||||||||||||
Share Incentive Plan | |||||||||||||||||||||||||
Number of | Weighted average | Intrinsic | |||||||||||||||||||||||
nonvested shares | grant date | value | |||||||||||||||||||||||
fair value | |||||||||||||||||||||||||
Outstanding as of January 1, 2011 | 337,443 | $ | 8.37 | $ | 2,806,766 | ||||||||||||||||||||
Granted | 361,256 | 12.83 | 4,650,290 | ||||||||||||||||||||||
Vested | (273,850 | ) | 6.83 | (1,876,338 | ) | ||||||||||||||||||||
Forfeited | (15,722 | ) | 9.07 | (143,571 | ) | ||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
Outstanding as of December 31, 2011 | 409,127 | $ | 13.25 | $ | 5,437,147 | ||||||||||||||||||||
Granted | 2,719 | 11.02 | 29,960 | ||||||||||||||||||||||
Vested | (156,072 | ) | 13.06 | (2,038,640 | ) | ||||||||||||||||||||
Forfeited | (28,366 | ) | 11.5 | (326,168 | ) | ||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
Outstanding as of December 31, 2012 | 227,408 | $ | 13.57 | $ | 3,102,299 | ||||||||||||||||||||
Vested | (57,373 | ) | 13.95 | (800,353 | ) | ||||||||||||||||||||
Forfeited | (3,406 | ) | 18.06 | (61,512 | ) | ||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
Outstanding as of December 31, 2013 | 166,629 | $ | 13.45 | $ | 2,240,434 | ||||||||||||||||||||
Nonvested shares vested and expect to vest as of December 31, 2013 | 1,686,203 | ||||||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
| | | | | | | | | | | |||||||||||||||
(ii) | |||||||||||||||||||||||||
2011 Equity Incentive Plan | |||||||||||||||||||||||||
Number of | Weighted average | Intrinsic | |||||||||||||||||||||||
nonvested | grant date | value | |||||||||||||||||||||||
share units | fair value | ||||||||||||||||||||||||
Outstanding as of January 1, 2012 | 1,045,698 | $ | 10.18 | $ | 10,600,967 | ||||||||||||||||||||
Granted | 3,833,474 | 7.83 | 30,027,735 | ||||||||||||||||||||||
Vested | (291,513 | ) | 10.41 | (3,034,746 | ) | ||||||||||||||||||||
Forfeited | (120,680 | ) | 10.95 | (1,321,957 | ) | ||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
Outstanding as of December 31, 2012 | 4,466,979 | $ | 8.13 | $ | 36,271,999 | ||||||||||||||||||||
Granted | 1,899,121 | 7.3 | 13,863,583 | ||||||||||||||||||||||
Vested | (210,086 | ) | 8.88 | (1,865,564 | ) | ||||||||||||||||||||
Forfeited | (401,794 | ) | 8.18 | (3,286,675 | ) | ||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
Outstanding as of December 31, 2013 | 5,754,220 | $ | 7.55 | $ | 44,983,343 | ||||||||||||||||||||
Nonvested shares vested and expect to vest as of December 31, 2013 | 6,255,819 | ||||||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
| | | | | | | | | | | |||||||||||||||
(iii) | |||||||||||||||||||||||||
VanceInfo 2007 Share Incentive Plan | |||||||||||||||||||||||||
Number of | Weighted average | Intrinsic | |||||||||||||||||||||||
nonvested | grant date | value | |||||||||||||||||||||||
share units | fair value | ||||||||||||||||||||||||
Granted as of November 9, 2012 | 722,869 | $ | 16.56 | $ | 11,968,510 | ||||||||||||||||||||
Vested | (14,738 | ) | 16.23 | (239,145 | ) | ||||||||||||||||||||
Forfeited | (24,157 | ) | 14.13 | (341,308 | ) | ||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
Outstanding as of December 31, 2012 | 683,974 | $ | 16.65 | $ | 11,388,057 | ||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
Vested | (250,704 | ) | 17.52 | (4,392,334 | ) | ||||||||||||||||||||
Forfeited | (99,355 | ) | 18.37 | (1,825,151 | ) | ||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
Outstanding as of December 31, 2013 | 333,915 | $ | 15.48 | $ | 5,170,572 | ||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
| | | | | | | | | | | |||||||||||||||
Nonvested shares vested and expect to vest as of December 31, 2013 | 599,357 | ||||||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
| | | | | | | | | | | |||||||||||||||
Compensation cost recognized in relation to nonvested shares was $4,388, $9,600 and $19,436 in 2011, 2012 and 2013, respectively. | |||||||||||||||||||||||||
There was $21,197 of total unrecognized compensation expense related to nonvested shares granted as of December 31, 2013. The expense is expected to be recognized over a weighted-average period of 1.91 years. | |||||||||||||||||||||||||
III. | |||||||||||||||||||||||||
Performance based share award options and nonvested shares | |||||||||||||||||||||||||
Number of | Weighted average | Intrinsic | |||||||||||||||||||||||
share units | grant date | value | |||||||||||||||||||||||
fair value | |||||||||||||||||||||||||
Outstanding as of January 1, 2012 | 695,430 | $ | 9.96 | $ | 6,925,500 | ||||||||||||||||||||
Granted | 1,870,614 | 7.07 | 13,064,870 | ||||||||||||||||||||||
Forfeited | (71,710 | ) | 7.49 | (537,049 | ) | ||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
Outstanding as of December 31, 2012 | 2,494,334 | 7,86 | 19,453,321 | ||||||||||||||||||||||
Forfeited | (156,505 | ) | 7.49 | (1,172,222 | ) | ||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
Outstanding as of December 31, 2013 | 2,337,829 | $ | 7.2 | $ | 18,281,099 | ||||||||||||||||||||
Option and nonvested shares vested and expect to vest as of December 31, 2013 | 2,783,106 | ||||||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
| | | | | | | | | | | |||||||||||||||
In connection with the merger of equals with VanceInfo, the Board approved to amend the existing options and nonvested shares such that the performance-based vesting criteria shall no longer apply. Accordingly, 1,118,424 performance based share options and nonvested shares were no longer subject to the performance-based vesting criteria as of December 31, 2012. The incremental cost of $1,915 was recorded in 2012 as a result of this modification. | |||||||||||||||||||||||||
IV. | |||||||||||||||||||||||||
Nonvested shares of a subsidiary granted to employees | |||||||||||||||||||||||||
As a result of the merger of equals with VanceInfo, the Company has a subsidiary named Pactera Financial Solutions Limited ("Pactera Financial Solutions"). Under the previous contractual agreement, the Company granted 33.3% equity interest or 1,000,000 common shares of Pactera Financial Solutions in the form of nonvested shares to key employees for their continuing employment. The Company is entitled to the right of repurchasing all equity interest held by the key employees after December 31, 2012. As of December 31, 2012, 395,000 of the previously granted nonvested shares were vested. Accordingly, there was 16.5% non-controlling interest in Pactera Financial Solutions. | |||||||||||||||||||||||||
On January 1, 2013, the Company purchased the noncontrolling interest in Pactera Financial Solutions held by the key employees with a total consideration of $6.3 million. The Company treated this as an equity transaction, and there was no impact on the consolidated statements of operations. | |||||||||||||||||||||||||
Share-based compensation expense | |||||||||||||||||||||||||
The Group recognizes compensation cost on the options using the graded vesting method. No tax benefit related thereto has been recognized by the Group. | |||||||||||||||||||||||||
The following table shows the share-based compensation expenses included in the consolidated statements of operations for the years ended December 31, 2011, 2012, and 2013: | |||||||||||||||||||||||||
2011 | 2012 | 2013 | |||||||||||||||||||||||
Cost of revenues | $ | 234 | $ | 165 | $ | 466 | |||||||||||||||||||
General and administrative | 4,906 | 10,405 | 21,466 | ||||||||||||||||||||||
Selling and marketing | 516 | 494 | 926 | ||||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
Total | $ | 5,656 | $ | 11,064 | $ | 22,858 | |||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
| | | | | | | | | | | |||||||||||||||
CHINA_CONTRIBUTION_PLAN_AND_PR
CHINA CONTRIBUTION PLAN AND PROFIT APPROPRIATION | 12 Months Ended |
Dec. 31, 2013 | |
CHINA CONTRIBUTION PLAN AND PROFIT APPROPRIATION | ' |
CHINA CONTRIBUTION PLAN AND PROFIT APPROPRIATION | ' |
19. CHINA CONTRIBUTION PLAN AND PROFIT APPROPRIATION | |
Full time employees of the Group in the PRC participate in a government-mandated multiemployer defined contribution plan pursuant to which certain pension benefits, medical care, unemployment insurance, employee housing fund and other welfare benefits are provided to employees. PRC labor regulations require the Group to accrue for these benefits based on certain percentages of the employees' salaries. These employee benefit expenses were $13,268, $22,556 and $48,383 in 2011, 2012 and 2013, respectively. | |
PRC legal restrictions permit payments of dividends by the Group's PRC entities only out of their retained earnings, if any, determined in accordance with PRC regulations. Prior to payment of dividends, pursuant to the laws applicable to the PRC Foreign Investment Enterprises, the Group's PRC subsidiaries must make appropriations from after-tax profit to non-distributable reserve funds as determined by the board of directors of the Company's PRC subsidiaries. These reserve funds include one or more of the following (i) a general reserve, (ii) an enterprise expansion fund, and (iii) a staff bonus and welfare fund. Subject to certain cumulative limits, the general reserve fund requires annual appropriations of 10% of after-tax profit (as determined under accounting principles generally accepted in the PRC at each year-end) until the balance reaches 50% of the registered capital, and the other fund appropriations are at the management's discretion. These statutory reserve funds can only be used for purposes of general enterprise expansion and staff bonus and welfare and are not distributable as cash dividends. Appropriations to these reserves by the Company's PRC subsidiaries were $2,875, $729 and $2,865 for the years ended December 31, 2011, 2012 and 2013, respectively. | |
As a result of these PRC laws and regulations and the requirement that distributions by PRC entities can only be paid out of distributable profits computed in accordance with the PRC GAAP, the PRC entities are restricted from transferring a portion of their net assets to the Group. Amounts restricted include paid-in capital and the statutory reserves of the Company's PRC subsidiaries. The aggregate amounts of capital and statutory reserves restricted which represented the amount of net assets of the relevant subsidiaries in the Group not available for distribution were $170,284 and $185,913 as of December 31, 2012 and 2013, respectively. | |
As a result of the above restrictions, parent-only financials are presented on financial statement Schedule I. | |
NET_INCOME_PER_SHARE
NET INCOME PER SHARE | 12 Months Ended | ||||||||||
Dec. 31, 2013 | |||||||||||
NET INCOME PER SHARE | ' | ||||||||||
NET INCOME PER SHARE | ' | ||||||||||
20. NET INCOME PER SHARE | |||||||||||
The following is a reconciliation of the numerators and denominators of the basic and diluted net income per share computations: | |||||||||||
Years ended December 31, | |||||||||||
2011 | 2012 | 2013 | |||||||||
Numerator used in basic and diluted net income per common share: | |||||||||||
Net income attributable to Pactera Technology International Ltd. shareholders | $ | 17,901 | $ | 2,590 | $ | 7,837 | |||||
| | | | | | | | | | | |
| | | | | | | | | | | |
Shares (denominator): | |||||||||||
Weighted average common shares outstanding used in computing basic net income per common share | 40,596,429 | 47,547,307 | 81,942,795 | ||||||||
| | | | | | | | | | | |
| | | | | | | | | | | |
Plus incremental weighted average common shares from assumed exercise of share options and vesting of nonvested shares using treasury stock method and shares issuable in connection with business acquisition | 2,359,862 | 1,896,853 | 3,010,251 | ||||||||
| | | | | | | | | | | |
Weighted average common shares outstanding used in computing diluted net income per common share | 42,956,291 | 49,444,160 | 84,953,046 | ||||||||
| | | | | | | | | | | |
| | | | | | | | | | | |
Net income per common share attributable to shareholders of Pactera Technology International Ltd. | |||||||||||
—Basic | $ | 0.44 | $ | 0.05 | $ | 0.1 | |||||
—Diluted | $ | 0.42 | $ | 0.05 | $ | 0.09 | |||||
| | | | | | | | | | | |
| | | | | | | | | | | |
As of December 31, 2013, 4,085,575 common shares were reserved for future delivery to employees upon exercise of vested share options or grant of nonvested shares, which were excluded in computing basic and diluted net income per share. | |||||||||||
471,009, 1,052,480 and 3,623,956 share options and nonvested shares had been excluded from the dilutive share calculation for the years ended December 31, 2011, 2012 and 2013, respectively, as their effects were anti-dilutive. | |||||||||||
LEASES_AND_COMMITMENTS
LEASES AND COMMITMENTS | 12 Months Ended | ||||
Dec. 31, 2013 | |||||
LEASES AND COMMITMENTS | ' | ||||
LEASES AND COMMITMENTS | ' | ||||
21. LEASES AND COMMITMENTS | |||||
The Group follows the authoritative pronouncement issued by FASB regarding accounting for leases, in determining the criteria for capital leases. Leases that do not meet such criteria are classified as operating leases and related rentals are charged to expenses in the year incurred. | |||||
The Group leases its facilities, office and residential building under non-cancelable operating lease agreements. Rental expenses under operating leases for the years ended December 31, 2011, 2012 and 2013 were $6,336, $10,472 and $ 21,599, respectively. | |||||
The Group's assets under capital leases as of December 31, 2013 were as follows: | |||||
Furniture, fixtures and electronic equipment | $ | 91 | |||
Less: Accumulated amortization | (91 | ) | |||
| | | | | |
$ | — | ||||
| | | | | |
Capital leases were classified as "property, plant and equipment" on the balance sheet. Capital lease amortization expense was $105, $106 and $91 for the years ended December 31, 2011, 2012 and 2013, respectively. | |||||
The following is a summary by years of future minimum lease payments for operating leases that have initial or remaining non-cancelable terms in excess of one year as of December 31, 2013: | |||||
Years ended December 31, | |||||
2014 | $ | 11,163 | |||
2015 | 8,236 | ||||
2016 | 3,984 | ||||
2017 | 1,582 | ||||
2018 and thereafter | 1,490 | ||||
| | | | | |
Total minimum lease payments | $ | 26,455 | |||
| | | | | |
| | | | | |
SEGMENT_INFORMATION_AND_REVENU
SEGMENT INFORMATION AND REVENUE ANALYSIS | 12 Months Ended | |||||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||||
SEGMENT INFORMATION AND REVENUE ANALYSIS | ' | |||||||||||||||||||
SEGMENT INFORMATION AND REVENUE ANALYSIS | ' | |||||||||||||||||||
22. SEGMENT INFORMATION AND REVENUE ANALYSIS | ||||||||||||||||||||
The Group's chief operating decision maker ("CODM") is the Chief Executive Officer, who reviews consolidated results when making decisions about allocating resources and assessing performance of the Group. As disclosed in Note 10, subsequent to the merger of equals with VanceInfo, former Hisoft and VanceInfo each represented one operating segment as of December 31, 2012. However, under the aggregation criteria set forth in the US GAAP with respect to segment reporting, the two operating segments were aggregated into one reportable segment as they have similar economic characteristics and provide the similar services. In the early 2013, the integration process of former VanceInfo and HiSoft had been completed as the Group had successfully integrated the financial system, business groups, and other support departments into one operating segment, and therefore the Group has only one reportable segment as of December 31, 2013. | ||||||||||||||||||||
The Group has internal reporting that does not distinguish between markets or segments. The Group operates in Asia, North America, Europe, and all of the Group's long-lived assets are located as follows: | ||||||||||||||||||||
Years ended December 31, | ||||||||||||||||||||
2011 | 2012 | 2013 | ||||||||||||||||||
Net | Long-lived | Net | Long-lived | Net | Long-lived | |||||||||||||||
Revenues(1) | assets(2) | Revenues(1) | Assets(2) | Revenues(1) | Assets(2) | |||||||||||||||
Greater China | $ | 87,264 | $ | 37,405 | $ | 172,316 | $ | 197,559 | $ | 401,988 | $ | 219,380 | ||||||||
United States | 49,271 | 19,922 | 75,306 | 31,729 | 135,647 | 31,118 | ||||||||||||||
Asia South | 29,673 | 8,549 | 45,276 | 23,984 | 69,884 | 21,700 | ||||||||||||||
Japan | 47,671 | 1,996 | 60,137 | 2,743 | 49,623 | 2,496 | ||||||||||||||
Europe | 5,110 | — | 5,996 | 3,387 | 12,877 | 3,387 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total | $ | 218,989 | $ | 67,872 | $ | 359,031 | $ | 259,402 | $ | 670,019 | $ | 278,081 | ||||||||
| | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Note: | ||||||||||||||||||||
-1 | ||||||||||||||||||||
Net revenues are presented by operating location of the Group's customer entities. | ||||||||||||||||||||
-2 | ||||||||||||||||||||
Long-lived assets are presented by the operating location of the subsidiaries of the Company. | ||||||||||||||||||||
The outsourced technology services provided by the Group include Infrastructure Technology Services ("ITS"), Research and Development Services ("RDS"), and Business Process Outsourcing ("BPO"). The Group's net revenues are substantially derived from these three services lines. | ||||||||||||||||||||
Years ended December 31, | ||||||||||||||||||||
2011 | 2012 | 2013 | ||||||||||||||||||
ITS | $ | 126,105 | $ | 212,448 | $ | 398,915 | ||||||||||||||
RDS | 92,884 | 144,173 | 259,606 | |||||||||||||||||
BPO | — | 2,410 | 11,498 | |||||||||||||||||
| | | | | | | | | | | ||||||||||
Total | $ | 218,989 | $ | 359,031 | $ | 670,019 | ||||||||||||||
| | | | | | | | | | | ||||||||||
| | | | | | | | | | | ||||||||||
SUBSEQUENT_EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2013 | |
SUBSEQUENT EVENTS | ' |
SUBSEQUENT EVENTS | ' |
23. SUBSEQUENT EVENTS | |
(a) | |
Going private | |
On May 20, 2013, the Company's board of directors received a non-binding proposal letter from an affiliate of funds managed or advised by Blackstone to acquire all of the outstanding shares of Pactera International not currently owned by the Company's non-executive Chairman, Chris Chen, its Chief Executive Officer, Tiak Koon Loh, and its Executive Committee members, David Chen, Sidney Huang and Jun Su (collectively, the "Buyer Consortium") in a going private transaction (the "Transaction") for $7.50 per ADS in cash, subject to certain conditions. According to the proposal letter, the Buyer Consortium intends to form an acquisition vehicle for the purpose of implementing the Transaction, and the Transaction is intended to be financed with a combination of equity capital funded by the Buyer Consortium and third-party debt. | |
Upon the unanimous recommendation of a Special Committee of the Company's board of directors consisting of independent directors and the approval of the Company's board of directors, on October 17, 2013, the Company announced that it entered into a definitive merger agreement ("Merger Agreement") with a Consortium led by funds managed or advised by Blackstone (as defined below), including (i) Blackstone, (ii) certain members of the Company's management comprising of Chris Chen, the Company's non-executive chairman and Tiak Koon Loh, the Company's chief executive officer and several other senior managers (the "Management") and (iii) GGV Capital and its affiliates ("GGV") (collectively, the "Buyer Consortium"). | |
The Merger Agreement provides that at the completion of the acquisition, the shareholders of the Company will receive $7.30 per common share or $7.30 per ADS of the Company (the "Transaction"). The price per Share and per ADS represents a premium of 39% over the Company's closing share price of $5.26 per ADS on May 17, 2013, the last trading day prior to the Company's announcement on May 20, 2013 that it had received the "going private" proposal as mentioned above, from a consortium, and a premium of 35% to the volume-weighted average closing price of the ADSs during the 30 trading days prior to May 20, 2013. | |
If the Merger closes pursuant to the Merger Agreement, the Company will become a privately-held company and its ADSs would cease to be listed on the Nasdaq Global Select Market. The Transaction is subject to various closing conditions, including a condition that the Merger Agreement be approved by an affirmative vote of shareholders representing two-thirds or more of the Shares present and voting in person or by proxy as a single class at a meeting of the Company's shareholders convened to consider the approval of the Merger Agreement and the Transaction and a condition that the parties obtain antitrust approvals for the Transaction. The Company has filed with the U.S. Securities and Exchange Commission (the "SEC") a transaction statement on Schedule 13E-3 and its amendments, which include a proxy statement of the Company. As of March 10, 2014, the transaction statement on Schedule 13E-3 had been cleared with the SEC, the merger transaction had also been approved by the majority of the shareholders. | |
(b) | |
The transferred of certain outsourcing business with ChinaSoft regarding the Huawei business | |
On December 27, 2013, the Group and ChinaSoft International Limited ("ChinaSoft"), a third party company, entered into several agreements ("Transfer Agreements") under which the Group would transfer the resources who mainly work on Huawei related projects, sell the related uncompleted business contracts, certain property, plant and equipment and operating leases to ChinaSoft. The Group will also transfer its outstanding accounts receivable balances to ChinaSoft at a price agreed by the two parties. In addition, the Group would pay certain employees a compensation of $2.5 million to motivate the completion of the transaction. The total consideration of the transaction was $49.6 million. The consummation of the transfer agreements depend on when the relevant closing conditions can be satisfied. As of December 31, 2013, the Group received $3.8 million as part of the consideration and recognized as accrued expenses and other payables. The relevant property, plant and equipment and leases expected to be transferred was classified as assets held for sale as of December 31, 2013. The transactions contemplated by the Transfer Agreements have been completed in the first quarter of 2014 as the closing conditions were met in January 2014, the relevant impacts will be accounted for in 2014 accordingly. | |
The Group did not expect this transaction to have a significant impact on its consolidated statements of operations upon the completion of this transaction. | |
(c) | |
Acquisition of Innoveo Solution AG, Swizerland ("Innoveo") | |
On January 1, 2014, the Group acquired 100% equity interest in Innoveo, a Switzerland based software company. The total consideration was estimated as $3.2 million, of which $2.8 million is subject to future performance measures of Innoveo. As of December 31, 2013, the Group has prepaid $1.2 million to Innoveo and recognized in other assets. The Group was still in the process of performing purchase price allocation. | |
SCHEDULE_I_CONDENSED_FINANCIAL
SCHEDULE I CONDENSED FINANCIAL INFORMATION OF PARENT COMPANY | 12 Months Ended | |||||||||||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||||||||||
SCHEDULE I CONDENSED FINANCIAL INFORMATION OF PARENT COMPANY | ' | |||||||||||||||||||||||||
SCHEDULE I CONDENSED FINANCIAL INFORMATION OF PARENT COMPANY | ' | |||||||||||||||||||||||||
PACTERA TECHNOLOGY INTERNATIONAL LTD. | ||||||||||||||||||||||||||
ADDITIONAL INFORMATION—FINANCIAL STATEMENT SCHEDULE I | ||||||||||||||||||||||||||
CONDENSED FINANCIAL INFORMATION OF PARENT COMPANY | ||||||||||||||||||||||||||
BALANCE SHEETS | ||||||||||||||||||||||||||
(In thousands of U.S. dollars, except share data, or otherwise noted) | ||||||||||||||||||||||||||
As of December 31, | ||||||||||||||||||||||||||
2012 | 2013 | |||||||||||||||||||||||||
ASSETS | ||||||||||||||||||||||||||
Current Assets: | ||||||||||||||||||||||||||
Cash and cash equivalents | $ | 28,972 | $ | 16,100 | ||||||||||||||||||||||
Other current assets | 302 | 880 | ||||||||||||||||||||||||
| | | | | | | | |||||||||||||||||||
Total current assets | 29,274 | 16,980 | ||||||||||||||||||||||||
| | | | | | | | |||||||||||||||||||
Investment in subsidiaries and VIE | 521,655 | 545,842 | ||||||||||||||||||||||||
| | | | | | | | |||||||||||||||||||
TOTAL ASSETS | $ | 550,929 | $ | 562,822 | ||||||||||||||||||||||
| | | | | | | | |||||||||||||||||||
| | | | | | | | |||||||||||||||||||
LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||||||||||||||||||||
Current Liabilities: | ||||||||||||||||||||||||||
Accrued expenses and other payables | $ | 9,944 | $ | 12,549 | ||||||||||||||||||||||
| | | | | | | | |||||||||||||||||||
Total current liabilities | 9,944 | 12,549 | ||||||||||||||||||||||||
| | | | | | | | |||||||||||||||||||
TOTAL LIABILITIES | 9,944 | 12,549 | ||||||||||||||||||||||||
| | | | | | | | |||||||||||||||||||
Shareholders' Equity: | ||||||||||||||||||||||||||
Common shares ($0.00139482 par value; 120,000,000 shares authorized; 88,312,068 and 85,503,321 shares issued and outstanding as of December 31, 2012 and 2013, respectively) | 123 | 119 | ||||||||||||||||||||||||
Additional paid-in capital | 502,748 | 497,391 | ||||||||||||||||||||||||
Shares issuable in connection with business acquisition | 1,537 | 2,503 | ||||||||||||||||||||||||
Retained earnings | 17,797 | 25,634 | ||||||||||||||||||||||||
Accumulated other comprehensive income | 18,780 | 24,626 | ||||||||||||||||||||||||
| | | | | | | | |||||||||||||||||||
Total shareholders' equity | 540,985 | 550,273 | ||||||||||||||||||||||||
| | | | | | | | |||||||||||||||||||
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $ | 550,929 | $ | 562,822 | ||||||||||||||||||||||
| | | | | | | | |||||||||||||||||||
| | | | | | | | |||||||||||||||||||
PACTERA TECHNOLOGY INTERNATIONAL LTD. | ||||||||||||||||||||||||||
ADDITIONAL INFORMATION—FINANCIAL STATEMENT SCHEDULE I | ||||||||||||||||||||||||||
CONDENSED FINANCIAL INFORMATION OF PARENT COMPANY | ||||||||||||||||||||||||||
STATEMENTS OF OPERATIONS | ||||||||||||||||||||||||||
(In thousands of U.S. dollars, or otherwise noted) | ||||||||||||||||||||||||||
Years ended December 31, | ||||||||||||||||||||||||||
2011 | 2012 | 2013 | ||||||||||||||||||||||||
Operating expenses | ||||||||||||||||||||||||||
General and administrative | $ | (7,156 | ) | $ | (23,074 | ) | $ | (24,666 | ) | |||||||||||||||||
Selling and marketing | (533 | ) | (494 | ) | (925 | ) | ||||||||||||||||||||
| | | | | | | | | | | ||||||||||||||||
Total operating expenses | (7,689 | ) | (23,568 | ) | (25,591 | ) | ||||||||||||||||||||
| | | | | | | | | | | ||||||||||||||||
Interest expense | (43 | ) | — | — | ||||||||||||||||||||||
Interest income | 607 | 645 | 27 | |||||||||||||||||||||||
| | | | | | | | | | | ||||||||||||||||
Net loss before income from subsidiaries and VIE | (7,125 | ) | (22,923 | ) | (25,564 | ) | ||||||||||||||||||||
Equity in income of subsidiaries and VIE | 25,026 | 25,513 | 33,401 | |||||||||||||||||||||||
| | | | | | | | | | | ||||||||||||||||
Net income | $ | 17,901 | $ | 2,590 | $ | 7,837 | ||||||||||||||||||||
| | | | | | | | | | | ||||||||||||||||
| | | | | | | | | | | ||||||||||||||||
PACTERA TECHNOLOGY INTERNATIONAL LTD. | ||||||||||||||||||||||||||
ADDITIONAL INFORMATION—FINANCIAL STATEMENT SCHEDULE I | ||||||||||||||||||||||||||
CONDENSED FINANCIAL INFORMATION OF PARENT COMPANY | ||||||||||||||||||||||||||
STATEMENTS OF COMPREHENSIVE INCOME | ||||||||||||||||||||||||||
(In thousands of U.S. dollars, or otherwise noted) | ||||||||||||||||||||||||||
Years ended December 31, | ||||||||||||||||||||||||||
2011 | 2012 | 2013 | ||||||||||||||||||||||||
Net income | $ | 17,901 | $ | 2,590 | $ | 7,837 | ||||||||||||||||||||
Other comprehensive income, net of tax: | ||||||||||||||||||||||||||
Change in cumulative foreign currency translation adjustment | 5,738 | 2,453 | 5,846 | |||||||||||||||||||||||
| | | | | | | | | | | ||||||||||||||||
Comprehensive income attributable to Parent Company | $ | 23,639 | $ | 5,043 | $ | 13,683 | ||||||||||||||||||||
| | | | | | | | | | | ||||||||||||||||
| | | | | | | | | | | ||||||||||||||||
PACTERA TECHNOLOGY INTERNATIONAL LTD. | ||||||||||||||||||||||||||
ADDITIONAL INFORMATION—FINANCIAL STATEMENT SCHEDULE I | ||||||||||||||||||||||||||
CONDENSED FINANCIAL INFORMATION OF PARENT COMPANY | ||||||||||||||||||||||||||
STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY | ||||||||||||||||||||||||||
(In thousands of U.S. dollars, except share data, or otherwise noted) | ||||||||||||||||||||||||||
Common shares | Shares to be | |||||||||||||||||||||||||
issued in | ||||||||||||||||||||||||||
Treasury | Additional | connection with | (Accumulated | Accumulated | ||||||||||||||||||||||
stock | paid-in | business acquisition | deficit) Retained earnings | other comprehensive income | ||||||||||||||||||||||
Shares | Amount | capital | Total equity | |||||||||||||||||||||||
Balance as of January 1, 2011 | 41,536,412 | $ | 58 | $ | — | $ | 176,517 | $ | — | $ | (12,212 | ) | $ | 10,589 | $ | 174,952 | ||||||||||
Issuance of common shares for share-based compensation | 1,075,406 | 2 | — | — | — | — | — | 2 | ||||||||||||||||||
Repurchase of common shares | (2 | ) | — | — | — | — | — | — | — | |||||||||||||||||
Share option exercise | — | — | — | 4,235 | — | — | — | 4,235 | ||||||||||||||||||
Share-based compensation | — | — | — | 5,656 | — | — | — | 5,656 | ||||||||||||||||||
Vesting of nonvested shares award | 108,251 | — | — | — | — | — | — | — | ||||||||||||||||||
Net income | — | — | — | — | — | 17,901 | — | 17,901 | ||||||||||||||||||
Foreign currency translation adjustments | — | — | — | — | — | — | 5,738 | 5,738 | ||||||||||||||||||
Comprehensive income | ||||||||||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance as of December 31, 2011 | 42,720,067 | 60 | — | 186,408 | — | 5,689 | 16,327 | 208,484 | ||||||||||||||||||
Issuance of common share for share based compensation | 2,150,814 | 3 | — | 11 | — | — | — | 14 | ||||||||||||||||||
Issuance of common shares as a result of merger of equals with VanceInfo | 43,441,188 | 60 | — | 326,718 | — | — | — | 326,778 | ||||||||||||||||||
Balance brought forward from VanceInfo as a result of merger | — | — | — | (11,407 | ) | 619 | 9,518 | — | (1,270 | ) | ||||||||||||||||
Stock option exercise | — | — | — | 1,933 | — | — | — | 1,933 | ||||||||||||||||||
Repurchase of common shares | (1 | ) | — | — | — | — | — | — | — | |||||||||||||||||
Share-based compensation | — | — | — | 11,125 | — | — | — | 11,125 | ||||||||||||||||||
Acquisition of non-controlling interest | — | — | — | (12,040 | ) | — | — | — | (12,040 | ) | ||||||||||||||||
Shares issuable in connection with business acquisition | — | — | — | — | 918 | — | — | 918 | ||||||||||||||||||
Net income | — | — | — | — | — | 2,590 | — | 2,590 | ||||||||||||||||||
Foreign currency translation adjustments | — | — | — | — | — | — | 2,453 | 2,453 | ||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance as of December 31, 2012 | 88,312,068 | 123 | — | 502,748 | 1,537 | 17,797 | 18,780 | 540,985 | ||||||||||||||||||
Repurchase of common shares | (4,643,359 | ) | — | (29,907 | ) | (93 | ) | — | — | — | (30,000 | ) | ||||||||||||||
Cancelation of common shares and treasury stock | (379,278 | ) | (4 | ) | 18,678 | (18,674 | ) | — | — | — | — | |||||||||||||||
Reissuance of treasury stock for share based compensation | 1,743,359 | — | 11,229 | (11,229 | ) | — | — | — | — | |||||||||||||||||
Issuance of common share for business acquisition | 319,556 | — | — | 2,464 | (2,464 | ) | — | — | — | |||||||||||||||||
Stock option exercise | — | — | — | 4,201 | — | — | — | 4,201 | ||||||||||||||||||
Vesting of nonvested shares award | 150,975 | — | — | — | — | — | — | — | ||||||||||||||||||
Share-based compensation | — | — | — | 23,000 | — | — | — | 23,000 | ||||||||||||||||||
Vesting of nonvested shares of a subsidiary | — | — | — | (1,363 | ) | — | — | — | (1,363 | ) | ||||||||||||||||
Acquisition of non-controlling interest | — | — | — | (3,592 | ) | — | — | — | (3,592 | ) | ||||||||||||||||
Disposal of variable interest entity | — | — | — | (71 | ) | — | — | — | (71 | ) | ||||||||||||||||
Shares issuable in connection with business acquisition | — | — | — | — | 3,430 | — | — | 3,430 | ||||||||||||||||||
Net income | — | — | — | — | — | 7,837 | — | 7,837 | ||||||||||||||||||
Foreign currency translation adjustments | — | — | — | — | — | — | 5,846 | 5,846 | ||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance as of December 31, 2013 | 85,503,321 | $ | 119 | $ | — | $ | 497,391 | $ | 2,503 | $ | 25,634 | $ | 24,626 | $ | 550,273 | |||||||||||
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
The accompanying notes are an integral part of these financial statements. | ||||||||||||||||||||||||||
PACTERA TECHNOLOGY INTERNATIONAL LTD. | ||||||||||||||||||||||||||
ADDITIONAL INFORMATION—FINANCIAL STATEMENT SCHEDULE I | ||||||||||||||||||||||||||
CONDENSED FINANCIAL INFORMATION OF PARENT COMPANY | ||||||||||||||||||||||||||
STATEMENTS OF CASH FLOWS | ||||||||||||||||||||||||||
(In thousands of U.S. dollars, or otherwise noted) | ||||||||||||||||||||||||||
Years ended December 31, | ||||||||||||||||||||||||||
2011 | 2012 | 2013 | ||||||||||||||||||||||||
Cash flows from operating activities: | ||||||||||||||||||||||||||
Net income | $ | 17,901 | $ | 2,590 | $ | 7,837 | ||||||||||||||||||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||||||||||||||||||||
Equity in income of subsidiaries and VIE | (25,026 | ) | (25,513 | ) | (33,401 | ) | ||||||||||||||||||||
Share-based compensation expenses | 5,656 | 11,064 | 22,858 | |||||||||||||||||||||||
Change in fair value of contingent consideration | 981 | (531 | ) | (102 | ) | |||||||||||||||||||||
Changes in operating assets and liabilities, net of effects of business acquisitions: | ||||||||||||||||||||||||||
Other long-term assets | 10 | — | — | |||||||||||||||||||||||
Intercompany receivables | 9,693 | 4,591 | 13,495 | |||||||||||||||||||||||
Other current assets | (11,574 | ) | 110 | (578 | ) | |||||||||||||||||||||
Accrued expenses and other payables | — | 8,193 | 2,605 | |||||||||||||||||||||||
Other current liabilities | (9,188 | ) | — | — | ||||||||||||||||||||||
| | | | | | | | | | | ||||||||||||||||
Net cash (used in) provided by operating activities | (11,547 | ) | 504 | 12,714 | ||||||||||||||||||||||
| | | | | | | | | | | ||||||||||||||||
Cash flows from investing activities: | ||||||||||||||||||||||||||
Dividends received | 1,411 | — | — | |||||||||||||||||||||||
Investment income received from subsidiary | — | 200 | — | |||||||||||||||||||||||
Deferred and contingent consideration paid for business acquisitions | — | (782 | ) | — | ||||||||||||||||||||||
| | | | | | | | | | | ||||||||||||||||
Net cash provided by (used in) investing activities | 1,411 | (582 | ) | — | ||||||||||||||||||||||
| | | | | | | | | | | ||||||||||||||||
Cash flows from financing activities: | ||||||||||||||||||||||||||
Repayment of short-term bank borrowings | (40,000 | ) | — | — | ||||||||||||||||||||||
Proceeds from issuance of common shares for share based compensation | 5,291 | 1,988 | 4,414 | |||||||||||||||||||||||
Deferred and contingent consideration paid for business acquisitions | (4,014 | ) | — | — | ||||||||||||||||||||||
Repurchase of common shares | — | — | (30,000 | ) | ||||||||||||||||||||||
| | | | | | | | | | | ||||||||||||||||
Net cash (used in) provided by financing activities | (38,723 | ) | 1,988 | (25,586 | ) | |||||||||||||||||||||
| | | | | | | | | | | ||||||||||||||||
Net (decrease) increase in cash and cash equivalents | (48,859 | ) | 1,910 | (12,872 | ) | |||||||||||||||||||||
| | | | | | | | | | | ||||||||||||||||
Cash and cash equivalents at the beginning of year | 75,921 | 27,062 | 28,972 | |||||||||||||||||||||||
| | | | | | | | | | | ||||||||||||||||
Cash and cash equivalents at the end of year | $ | 27,062 | $ | 28,972 | $ | 16,100 | ||||||||||||||||||||
| | | | | | | | | | | ||||||||||||||||
| | | | | | | | | | | ||||||||||||||||
PACTERA TECHNOLOGY INTERNATIONAL LTD. | ||||||||||||||||||||||||||
ADDITIONAL INFORMATION—FINANCIAL STATEMENT SCHEDULE I | ||||||||||||||||||||||||||
CONDENSED FINANCIAL INFORMATION OF PARENT COMPANY | ||||||||||||||||||||||||||
NOTES TO THE FINANCIAL STATEMENTS | ||||||||||||||||||||||||||
FOR THE YEARS ENDED DECEMBER 31, 2011, 2012 AND 2013 | ||||||||||||||||||||||||||
(In thousands of U.S. dollars, or otherwise noted) | ||||||||||||||||||||||||||
1. BASIS OF PREPARATION | ||||||||||||||||||||||||||
The condensed financial information of the Parent Company, Pactera Technology International Ltd., has been prepared using the same accounting policies as set out in the Company'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, because the restricted net assets of the Company's subsidiaries were over the 25% of the consolidated net assets of the Company as of December 31, 2013. | ||||||||||||||||||||||||||
2. INVESTMENTS IN SUBSIDIARIES AND VIE | ||||||||||||||||||||||||||
For the purpose of the Parent Company's stand-alone financial information, investments in subsidiaries and VIE are reported using the equity method of accounting. The Parent Company's share of income from the subsidiaries and VIE was reported in the single line item of equity in income of subsidiaries and VIE. Under the equity method, the Parent Company ceases to record its share of the losses once the carrying value of the investment has been reduced to zero unless the Parent Company has the obligation to fund losses in its subsidiaries and VIE. | ||||||||||||||||||||||||||
SUMMARY_OF_SIGNIFICANT_ACCOUNT1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended | |||||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ' | |||||||||||||||||||
Basis of presentation | ' | |||||||||||||||||||
Basis of presentation | ||||||||||||||||||||
The consolidated financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States of America ("US GAAP"). | ||||||||||||||||||||
Basis of consolidation | ' | |||||||||||||||||||
Basis of consolidation | ||||||||||||||||||||
The consolidated financial statements include the financial statements of the Company, all its subsidiaries and the VIE. All inter-company transactions and balances have been eliminated upon consolidation. | ||||||||||||||||||||
Use of estimates | ' | |||||||||||||||||||
Use of estimates | ||||||||||||||||||||
The preparation of consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses for the reporting periods and the accompanying notes. Significant accounting estimates reflected in the consolidated financial statements include, but are not limited to revenue recognition, provision for income taxes, share-based compensation, impairment of goodwill and indefinite lived intangible assets, allowance for doubtful accounts, purchase price allocation in business combinations, contingent consideration, valuation allowance of deferred tax assets, useful life of property, plant and equipment, and economic life of intangible assets as well as performance based share awards. Actual results could differ from those estimates. | ||||||||||||||||||||
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 have original maturities of three months or less when purchased. | ||||||||||||||||||||
Term deposits | ' | |||||||||||||||||||
Term deposits | ||||||||||||||||||||
The Group's term deposits are classified as held-to-maturity and carried at amortized cost. The term deposits mature within one year from the contractual dates and are subject to penalty for early redemption before their maturity. | ||||||||||||||||||||
Short-term investments | ' | |||||||||||||||||||
Short-term investments | ||||||||||||||||||||
Short-term investments comprise marketable debt securities, which are classified as held-to-maturity as the Group has the positive intent and ability to hold the securities to maturity. All of the Group's held-to-maturity securities are stated at their amortized costs and classified as short-term investments on the consolidated balance sheets based on their contractual maturity dates which are less than one year. | ||||||||||||||||||||
The Group reviews its short-term investments for other-than-temporary impairment based on the specific identification method. The Group considers available quantitative and qualitative evidence in evaluating potential impairment of its short-term investments. If the cost of an investment exceeds the investment's fair value, the Group considers, among other factors, general market conditions, government economic plans, the duration and the extent to which the fair value of the investment is less than the cost, and the Group's intent and ability to hold the investment, in determining if impairment is needed. | ||||||||||||||||||||
Allowance for doubtful accounts | ' | |||||||||||||||||||
Allowance for doubtful accounts | ||||||||||||||||||||
Accounts receivables represent those receivables derived in the ordinary course of business. The Group maintains an allowance for doubtful accounts for estimated incurred losses on uncollected accounts receivables. Management considers the following factors when determining the collectability of specific accounts: credibility of the customers, aging of the receivables, historical loss experience and other specific circumstances related to the accounts. | ||||||||||||||||||||
Assets held for sale | ' | |||||||||||||||||||
Assets held for sale | ||||||||||||||||||||
The Group considers property, plant and equipment to be assets held for sale when all of the following criteria are met: i) a formal commitment to a plan to sell a property was made and exercised; ii) the property is available for sale in its present condition; iii) actions required to complete the sale of the property have been initiated; iv) sale of the property is probable and the Group expects the completed sale will occur within one year; v) the property is actively being marketed for sale at a price that is reasonable given its current market value; and vi) actions required to complete the plan indicate that it is unlikely that significant changes to the plan will be made or that the plan will be withdrawn. | ||||||||||||||||||||
Upon designation as an asset held for sale, the Group records each property at the lower of its carrying value or its estimated fair value, less estimated costs to sell, and the Group ceases depreciation. | ||||||||||||||||||||
Concentration risk | ' | |||||||||||||||||||
Concentration risk | ||||||||||||||||||||
Financial instruments that potentially expose the Group to concentrations of credit risk consist primarily of cash and cash equivalents, restricted cash and accounts receivable. The Group places their cash and cash equivalents and restricted cash with authorized financial institutions, which refer to (i) banks incorporated in China, which are all authorized to operate banking business by China Banking Regulatory Commission and other relevant agencies, and (ii) overseas financial institutions regulated by competent regulatory authorities in their relevant jurisdictions such as Hong Kong. The credit risk on cash and cash equivalent and restricted cash is limited because the counterparties are banks with high credit ratings. The Group conducts credit evaluations of its clients and generally does not require collateral or other security from them. The maximum exposure to credit risk is represented by their carrying amounts in the consolidated balance sheet. | ||||||||||||||||||||
Details of customers accounting for 10% or more of net revenues were as follows: | ||||||||||||||||||||
Years ended December 31, | ||||||||||||||||||||
2011 | % | 2012 | % | 2013 | % | |||||||||||||||
Client A | 17,826 | 8 | 29,772 | 8 | 69,530 | 10 | ||||||||||||||
Client B | 23,928 | 11 | 26,582 | 7 | 38,512 | 6 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Details of customer accounting for 10% or more of accounts receivable were as follows: | ||||||||||||||||||||
Years ended | ||||||||||||||||||||
December 31, | ||||||||||||||||||||
2012 | 2013 | |||||||||||||||||||
Client C | 31 | % | 18 | % | ||||||||||||||||
| | | | | | | | |||||||||||||
| | | | | | | | |||||||||||||
Equity method investment | ' | |||||||||||||||||||
Equity method investment | ||||||||||||||||||||
Investee companies over which the Group has the ability to exercise significant influence, but does not have a controlling interest are accounted for using the equity method. Significant influence is generally considered to exist when the Group has an ownership interest in the voting stock of the investee between 20% and 50%, and other factors, such as representation in the investee's Board of Directors, voting rights and the impact of commercial arrangements, are considered in determining whether the equity method of accounting is appropriate. | ||||||||||||||||||||
The Group reviews the long-term investments for impairment whenever events or circumstances indicate that an other-than-temporary decline has occurred. An impairment loss is recognized in earnings equal to the amount of the investment's carrying amount in excess of its fair value at the assessment date. The fair value of the investment would then become the new cost basis of the investment. | ||||||||||||||||||||
Property, plant and equipment, net | ' | |||||||||||||||||||
Property, plant and equipment, net | ||||||||||||||||||||
Property, plant and equipment, net, are stated at cost less accumulated depreciation. Depreciation is provided using the straight-line method over the following estimated useful lives: | ||||||||||||||||||||
Building | 30 years | |||||||||||||||||||
Furniture, fixtures and electronic equipment & software | 3 – 5 years | |||||||||||||||||||
Transportation equipment | 5 years | |||||||||||||||||||
Leasehold improvements | Shorter of useful life | |||||||||||||||||||
of the asset or the lease term | ||||||||||||||||||||
Land use right | ' | |||||||||||||||||||
Land use right | ||||||||||||||||||||
All land in the PRC is owned by the PRC government. The government in the PRC, according to the relevant PRC law, may grant the right to the enterprise to use the land for a specified period of time. Land use right is stated at cost less accumulated amortization. Amortization is provided over the contractual term of the land use right on a straight-line basis. | ||||||||||||||||||||
Intangible assets, impairment of long-lived assets and impairment of goodwill and indefinite-lived assets | ' | |||||||||||||||||||
Intangible assets | ||||||||||||||||||||
Acquired intangible assets, other than goodwill, are initially measured and recorded at their fair values. Subsequently, the trade name with indefinite life is stated at cost less impairment loss and other acquired intangible assets with definite life are stated at cost less accumulated amortization and impairment loss. Customer base and customer relationship are amortized using the estimated attrition pattern. Other acquired intangible assets are amortized using the straight-line method. The estimated economic lives are as follows: | ||||||||||||||||||||
Customer base and customer relationship | 3 – 6.8 years | |||||||||||||||||||
Non-compete agreement | 1 – 5 years | |||||||||||||||||||
Contract backlog | 0.5 – 2.14 years | |||||||||||||||||||
Trade name | 1 year – Indefinite | |||||||||||||||||||
Trademark | 1 – 2 years | |||||||||||||||||||
Software Technology | 4 – 5 years | |||||||||||||||||||
Impairment of long-lived assets with definite lives | ||||||||||||||||||||
The Group evaluates the recoverability of long-lived assets, including property, plant and equipment and intangible assets with determinable useful lives whenever events or changes in circumstances indicate that an asset's carrying amount may not be recoverable. The Group measures the carrying amount of long-lived asset against the estimated undiscounted future cash flows associated with it. Impairment exists when the sum of the expected future net cash flows is less than the carrying value of the asset being evaluated. Impairment loss is calculated as the amount by which the carrying value of the asset exceeds its fair value. Fair value is estimated based on various valuation techniques, including the discounted value of estimated future cash flows. The evaluation of asset impairment requires the Group to make assumptions about future cash flows over the life of the asset being evaluated. These assumptions require significant judgment and actual results may differ from assumed and estimated amounts. | ||||||||||||||||||||
Impairment of goodwill and indefinite-lived intangible assets | ||||||||||||||||||||
Goodwill and intangible assets with indefinite useful lives are not amortized, but tested for impairment annually or more frequently if event and circumstances indicate that they 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. Absent from any impairment indicators, the Group performs its annual impairment test on December 31 each year, following a two-step process. The first step compares the fair value of each reporting unit to its carrying amount, including goodwill. If the fair value of each reporting unit exceeds its carrying amount, goodwill is not considered to be impaired and the second step will not be required. If the carrying amount of a reporting unit exceeds its fair value, the second step compares the implied fair value of goodwill to the carrying value of a reporting unit's goodwill. The implied fair value of goodwill is determined in a manner similar to accounting for a business combination with the allocation of the assessed fair value determined in the first step to the assets and liabilities of the reporting unit. The excess of the fair value of the reporting unit over the amounts assigned to the assets and liabilities is the implied fair value of goodwill. An impairment loss is recognized for any excess in the carrying value of goodwill over the implied fair value of goodwill. | ||||||||||||||||||||
The Group has determined that the Group's certain trade names do not have determinable useful lives. Consequently, the carrying amounts of these trade names are not subject to amortization but are tested for impairment at least annually or if events or changes in circumstances indicate that the asset might be impaired. Such impairment test compares the fair values of assets with their carrying value amounts and an impairment loss is recognized if and when the carrying amounts exceed the fair values. The estimates of fair values of intangible assets not subject to amortization are determined using various discounted cash flow valuation methodologies. Significant assumptions are inherent in this process, including estimates of discount rates. | ||||||||||||||||||||
Revenue recognition | ' | |||||||||||||||||||
Revenue recognition | ||||||||||||||||||||
The Group enters into sales contractual arrangements related to its technology outsourcing services. For each contract, revenues are recognized in accordance with an authoritative pronouncement regarding revenue recognition issued by Financial Accounting Standards Board ("FASB") and when all of the following criteria are met: persuasive evidence of sales arrangement exists; delivery has occurred or services have been rendered; the price is fixed or determinable; and collectability is reasonably assured. | ||||||||||||||||||||
Arrangements for technology outsourcing services are either on a time-and-material or fixed-price basis. | ||||||||||||||||||||
Revenues from time-and-material contracts are recognized as billable services are rendered, assuming all other basic revenue recognition criteria are met. | ||||||||||||||||||||
Revenues from fixed-price contracts are recognized using the proportional performance method as determined by the proportional relation of the contract costs incurred to date relative to the estimated total contract costs at completion. Estimated contract costs are obtained from budgets that are reviewed monthly and revised as necessary. The Group reviews the estimated revenues and estimated costs on each project at the end of each reporting period. Any revisions to existing estimates are made when required by members of management having the relevant authority. As part of the review process, management regularly compares and analyzes the actual costs incurred and the estimate of costs to complete the projects to the total estimated costs and the total contract price. Management make revisions to existing estimates as needed based on the analysis performed and with proper level of approval in the period in which changes become known. As a policy, provisions for estimated losses on such engagements will be made during the period in which a loss becomes probable and can be reasonably estimated. | ||||||||||||||||||||
Reimbursable out-of-pocket expenses and material costs are recognized as revenues when billed. | ||||||||||||||||||||
For the years ended December 31, 2011, 2012 and 2013, details of net revenues breakdown by contract type were as follows: | ||||||||||||||||||||
Years ended December 31, | ||||||||||||||||||||
2011 | 2012 | 2013 | ||||||||||||||||||
Time-and-material | $ | 175,115 | $ | 282,615 | $ | 543,062 | ||||||||||||||
Fixed-price | 43,874 | 76,416 | 126,957 | |||||||||||||||||
| | | | | | | | | | | ||||||||||
Total | $ | 218,989 | $ | 359,031 | $ | 670,019 | ||||||||||||||
| | | | | | | | | | | ||||||||||
| | | | | | | | | | | ||||||||||
Value added tax ("VAT") | ' | |||||||||||||||||||
Value added tax ("VAT") | ||||||||||||||||||||
The Company's PRC subsidiaries are subject to value-added tax at a rate of 17% on revenues from product sales and services and are paid after deducting input VAT on purchases. The net VAT balance between input VAT and output VAT is reflected in the account under other taxes payable. | ||||||||||||||||||||
In July 2012, the Ministry of Finance and the State Administration of Taxation jointly issued a circular regarding the pilot collection of VAT in lieu of business tax in certain areas and industries in the PRC. Such VAT pilot program is to be phased in Beijing, Jiangsu, Anhui, Fujian, Guangdong, Tianjin, Zhejiang and Hubei starting from September 1, 2012, October 1, 2012, October 1, 2012, November 1, 2012, November 1, 2012, December 1, 2012, December 1, 2012 and December 1, 2012. Since August 2013, this tax pilot program had been expanded to the remaining areas within China. As a result, from August 1, 2013 the Company's PRC subsidiaries are subject to VAT at the rates, 6% or 3%. | ||||||||||||||||||||
Business tax | ' | |||||||||||||||||||
Business tax | ||||||||||||||||||||
The Company's subsidiaries in the PRC are subject to business tax of 5% and related surcharges on the revenues earned from providing services. Business tax is recorded as a reduction in revenues when incurred, and the outstanding balance has been recorded in other taxes payable. | ||||||||||||||||||||
Government subsidies | ' | |||||||||||||||||||
Government subsidies | ||||||||||||||||||||
Government subsidies mainly represent amounts granted by local government authorities as an incentive for companies to promote development of the local technology industry. The Group receives government subsidies related to government sponsored projects, and records such government subsidies as a liability when it is received. The Group records government subsidies as deductions of the related expenses when there is no further performance obligation. Total government subsidies amounted to $2,744, $13,334 and $11,326 for the years ended December 31, 2011, 2012 and 2013, respectively, and were included in general and administrative expenses and cost of revenues. | ||||||||||||||||||||
Operating and Capital Leases | ' | |||||||||||||||||||
Operating leases | ||||||||||||||||||||
Leases where substantially all the rewards and risks of ownership of assets remain with the lessor are accounted for as operating leases. Payments made under operating leases are charged to the consolidated statements of operations on a straight-line basis over the lease periods. | ||||||||||||||||||||
Capital leases | ||||||||||||||||||||
Capital leases are recorded as an asset and an obligation at an amount equal to the present value, at the beginning of lease term, of minimum lease payments during the lease term, or if lower, the fair value of the leased assets. The assets are amortized over the useful lives of the assets, or if shorter, the lease term. Lease payments are allocated between a reduction of the obligation and interest expense so as to produce a consistent periodic rate of interest on the remaining balance of the obligation. | ||||||||||||||||||||
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 consolidated 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 on the income tax return 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. | ||||||||||||||||||||
Foreign currency translation | ' | |||||||||||||||||||
Foreign currency translation | ||||||||||||||||||||
The functional and reporting currency of the Company is the United States dollar ("U.S. dollar"). | ||||||||||||||||||||
The financial records of the Company's subsidiaries and VIE located in the PRC, Japan, the U.S., Hong Kong, Singapore, Australia and Spain are maintained in their local currencies, the Renminbi ("RMB"), Japanese Yen ("Yen"), U.S. dollar, Hong Kong Dollar ("HK$"), Singapore Dollars ("SN$"), Australia Dollar ("AU$") and Euro Dollar ("Euro"), respectively, which are also the functional currencies of these entities. | ||||||||||||||||||||
Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency at the rates of exchange ruling at the balance sheet date. Transactions in currencies other than the functional currency during the year are converted into functional currency at the applicable rates of exchange prevailing when the transactions occurred. Transaction gains and losses are recognized in the consolidated statements of operations. For the years ended December 31, 2011, 2012 and 2013, foreign currency exchange losses were $2,070, $1,042 and $616, respectively. | ||||||||||||||||||||
The entities with functional currency other than U.S. dollar translate their operating results and financial position into the U.S. dollar, the Group's reporting currency. Assets and liabilities are translated using the exchange rates in effect on the balance sheet date. Equity amounts are translated at historical exchange rates. Revenues, expenses, gains and losses are translated using the average rate for the year. Translation adjustments are reported as foreign currency translation adjustments and are shown as a separate component of other comprehensive income. | ||||||||||||||||||||
The exchange losses have been reclassified from operating expenses to other income in the consolidated financial statement to conform with the presentation of the financial statements for the year ended December 31, 2013. | ||||||||||||||||||||
Comprehensive income | ' | |||||||||||||||||||
Comprehensive income | ||||||||||||||||||||
Comprehensive income for the year includes net income and foreign currency translation adjustments and is reported in the consolidated statements of comprehensive income. | ||||||||||||||||||||
Financial instruments | ' | |||||||||||||||||||
Financial instruments | ||||||||||||||||||||
Financial instruments include cash and cash equivalents, restricted cash, term deposits, short-term investment, accounts receivable and accounts payable. The carrying values of cash and cash equivalents, restricted cash, term deposits, accounts receivable and accounts payable approximate their fair values due to short-term maturities. | ||||||||||||||||||||
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 that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. An asset or liability categorization within the fair value hierarchy 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 assets or liabilities 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. Fair value of foreign currency forward contracts is discussed in Note 15. | ||||||||||||||||||||
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. | ||||||||||||||||||||
Fair value of acquired assets and contingent consideration is discussed in Note 15. | ||||||||||||||||||||
Net income per share | ' | |||||||||||||||||||
Net income per share | ||||||||||||||||||||
Basic net income per common share is computed by dividing net income attributable to common shareholders by the weighted average number of common shares outstanding during the period. | ||||||||||||||||||||
Diluted net income per common share reflects the potential dilution that could occur if securities or other contracts to issue common shares were exercised or converted into common shares. | ||||||||||||||||||||
The Group had stock options and potentially issuable common shares whose issuance is contingent upon the satisfaction of certain conditions in connection with business acquisitions, which could potentially dilute basic net income per share. To calculate the number of shares for diluted net income per share, the effect of stock options is computed using the treasury stock method. | ||||||||||||||||||||
Share-based compensation | ' | |||||||||||||||||||
Share-based compensation | ||||||||||||||||||||
Share-based payment transactions with employees, such as stock options, are measured based on the grant date fair value of the equity instrument. The Group recognizes the compensation costs, net of expected forfeitures, using the graded vesting method over the requisite service period of the award, which is generally the vesting period of the award. The estimate of forfeitures will be adjusted over the requisite service period to the extent that actual forfeitures differ, or are expected to differ, from such estimates. Changes in estimated forfeitures are recognized through a cumulative catch-up adjustment in the period of change and will also impact the amount of stock compensation expense to be recognized in future periods. | ||||||||||||||||||||
Business combinations | ' | |||||||||||||||||||
Business combinations | ||||||||||||||||||||
Business combinations are recorded using the acquisition method of accounting. The assets acquired, the liabilities assumed, and any non-controlling 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 non-controlling interest of the acquiree, if any, at the acquisition date over the fair values of the identifiable net assets acquired. | ||||||||||||||||||||
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 of 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, 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 the consolidated statements of operations. | ||||||||||||||||||||
Recent accounting pronouncements adopted and not yet adopted | ' | |||||||||||||||||||
Recent 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 significant effect on its consolidated financial statements. | ||||||||||||||||||||
In July 2013, the FASB issued a pronouncement 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 Accounting Standards Updates ("ASU") is to eliminate diversity in practice resulting from a lack of guidance on this topic in current US 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 significant effect on its consolidated financial statements. | ||||||||||||||||||||
ORGANIZATION_AND_PRINCIPAL_ACT1
ORGANIZATION AND PRINCIPAL ACTIVITIES (Tables) | 12 Months Ended | |||||||||
Dec. 31, 2013 | ||||||||||
ORGANIZATION AND PRINCIPAL ACTIVITIES | ' | |||||||||
Schedule of company's subsidiaries and variable interest entity | ' | |||||||||
As of December 31, 2013, the Company's subsidiaries are as follows: | ||||||||||
Subsidiaries | ||||||||||
Subsidiaries | Later of date of | Place of | Percentage of | |||||||
incorporation | incorporation | legal ownership | ||||||||
or acquisition | ||||||||||
Pactera Technology Japan Co., Ltd. ("Pactera Japan") | August 1, 2002 | Japan | 100 | % | ||||||
DMK International, Inc. ("DMK International") | September 4, 2003 | U.S. | 100 | % | ||||||
Dalian Pactera Technology Limited ("Pactera Dalian") (formerly known as HiSoft Technology (Dalian) Co., Ltd.) | July 27, 2004 | PRC | 100 | % | ||||||
Pactera Systems (Hong Kong) Limited ("Pactera Systems Hong Kong") | October 12, 2005 | Hong Kong | 100 | % | ||||||
Shenzhen Pactera Systems Limited ("Pactera Shenzhen Systems") | November 9, 2005 | PRC | 100 | % | ||||||
HiSoft Services (Beijing) Limited ("HiSoft Beijing") | November 10, 2005 | PRC | 100 | % | ||||||
Pactera Technologies NA, Inc. ("Pactera NA") | December 31, 2006 | U.S. | 100 | % | ||||||
Chengdu Pactera Technology Limited ("Pactera Chengdu") (formerly known as HiSoft Technology (Chengdu) Co., Ltd.) | April 4, 2007 | PRC | 100 | % | ||||||
Pactera Singapore Pte. Ltd. ("Pactera Singapore") (formerly known as Hisoft Technology (Singapore) Pte Ltd.) | December 1, 2007 | Singapore | 100 | % | ||||||
Wuxi Pactera Technology Limited ("Pactera Wuxi") (formerly known as Wuxi HiSoft Services Limited) | January 8, 2009 | PRC | 100 | % | ||||||
AllianceSPEC Pte. Ltd. ("AllianceSPEC") | December 1, 2009 | Singapore | 100 | % | ||||||
Wuxi Pactera Technology Training Limited ("Wuxi Training Center") (formerly known as Wuxi Hisoft Technology Training Co,. Ltd.) | December 25, 2009 | PRC | 100 | % | ||||||
Beijing Horizon Information & Technology Co., Ltd. ("Horizon Information") | February 1, 2010 | PRC | 100 | % | ||||||
Insurance Systems Laboratory Co., Ltd. ("ISL") | July 1, 2010 | Japan | 100 | % | ||||||
Beijing Pactera Jinxin Technology Limited ("Pactera Jinxin") (formerly known as HiSoft Jinxin Technology (Beijing) Co., Ltd.) | January 26, 2011 | PRC | 100 | % | ||||||
NouvEON Technology Partners, Inc. ("NouvEON") | July 1, 2011 | U.S. | 100 | % | ||||||
Shanghai HURO Digital Technology Co., Ltd. ("HURO") | October 1, 2011 | PRC | 100 | % | ||||||
Pactera Holdings Spain, S.L. (formerly known as Logoscript International S.L.) and its subsidiaries ("Pactera Spain") | February 1, 2012 | Spain | 100 | % | ||||||
Beijing Pactera Glorycube Technology Limited ("Glory") (formerly known as Beijing GloryCube Technology Co., Ltd.) | June 1, 2012 | PRC | 100 | % | ||||||
Bearing Point Holdings Pty. Limited and its subsidiaries ("Bearing Point") | July 1, 2012 | Australia | 100 | % | ||||||
Shenzhen Pactera Information Limited ("Pactera Shenzhen Information") (formerly known as HiSoft Technology (Shenzhen) Co., Ltd. | May 11, 2012 | PRC | 100 | % | ||||||
VanceInfo Technologies Inc. ("VanceInfo") | November 9, 2012 | Cayman Islands | 100 | % | ||||||
Pactera Technology Limited ("Pactera Beijing") (formerly known as VanceInfo Creative Software Technology Limited) | November 9, 2012 | PRC | 100 | % | ||||||
Pactera Technology Limited ("Pactera BVI") | November 9, 2012 | BVI | 100 | % | ||||||
Pactera Technologies Inc. ("Pactera US") | November 9, 2012 | U.S. | 100 | % | ||||||
Pactera (Hong Kong) Limited ("Pactera Hong Kong") | November 9, 2012 | Hong Kong | 100 | % | ||||||
Shanghai Pactera Technology Limited ("Pactera Shanghai Technology") (formerly known as Shanghai VanceInfo Technologies Limited) | November 9, 2012 | PRC | 100 | % | ||||||
VanceInfo Technologies Limited ("VanceInfo Tianjin") | November 9, 2012 | PRC | 100 | % | ||||||
Shanghai Pactera Software Technology Limited ("Pactera Shanghai") (formerly known as Shanghai VanceInfo Creative Software Technology Limited) | November 9, 2012 | PRC | 100 | % | ||||||
Pactera Malaysia Inc. Sdn. Bhd. ("Pactera Malaysia") | November 9, 2012 | Malaysia | 100 | % | ||||||
Shenzhen Pactera Technology Limited ("Pactera Shenzhen") (formerly known as Shenzhen VanceInfo Creative Software Technology Limited) | November 9, 2012 | PRC | 100 | % | ||||||
Nanjing Pactera Technology Limited ("Pactera Nanjing") (formerly known as Nanjing VanceInfo Creative Software Technology Limited) | November 9, 2012 | PRC | 100 | % | ||||||
TP Teleservices Limited ("TP Teleservices") | November 9, 2012 | Hong Kong | 100 | % | ||||||
TP (Hong Kong) Limited ("TP Hong Kong") | November 9, 2012 | Hong Kong | 100 | % | ||||||
TP Consultants Limited ("TP Consultants") | November 9, 2012 | Hong Kong | 100 | % | ||||||
TP (Taiwan) Limited ("TP Taiwan") | November 9, 2012 | Hong Kong | 100 | % | ||||||
TP Software Technology (Shanghai) Co., Ltd. ("TP Shanghai") | November 9, 2012 | PRC | 100 | % | ||||||
Pactera Financial Service Limited ("Pactera Financial Services") (formerly named "Link Result Limited") | November 9, 2012 | Hong Kong | 100 | % | ||||||
Pactera Data Service (Shanghai) Limited ("Pactera Data") (formerly known as VanceInfo Data Service (Shanghai) Limited) | November 9, 2012 | PRC | 100 | % | ||||||
Beijing Viatt Information Technology Co., Ltd. ("Beijing Viatt") | November 9, 2012 | PRC | 100 | % | ||||||
Lifewood Technology Limited ("Lifewood Technology") | November 9, 2012 | Hong Kong | 100 | % | ||||||
Lifewood Data Technology Limited ("Lifewood Data") | November 9, 2012 | Hong Kong | 100 | % | ||||||
Lifewood Data Technology (Dongguan) Limited ("Lifewood Dongguan") | November 9, 2012 | PRC | 100 | % | ||||||
Pactera Technologies Australia Pty Ltd ("Pactera Australia") (formerly known as VanceInfo Technologies Australia Pty. Ltd.) | November 9, 2012 | Australia | 100 | % | ||||||
Beijing Data Pioneer Information Technology Co., Ltd. ("Beijing DPC") | November 9, 2012 | PRC | 100 | % | ||||||
Beijing Kang Pu Wei Century Information Technology Co., Ltd. ("Beijing KPW") | November 9, 2012 | PRC | 100 | % | ||||||
VanceInfo Singapore Pte. Ltd. ("VanceInfo Singapore") | November 9, 2012 | Singapore | 100 | % | ||||||
Pactera Financial Solutions Limited ("Pactera Financial Solutions") | November 9, 2012 | BVI | 100 | % | ||||||
Beijing Sunwin Corporation Limited ("Sunwin") | November 9, 2012 | PRC | 100 | % | ||||||
Beijing Pactera Airsoft Technology Limited ("Pactera Airsoft") (formerly known as Beijing VanceInfo Airsoft Technology Ltd.) | November 9, 2012 | PRC | 100 | % | ||||||
Suzhou VanceInfo Creative Software Technology Limited ("VanceInfo Suzhou") | November 9, 2012 | PRC | 100 | % | ||||||
Wuxi Pactera Outsourcing Service Limited ("Pactera Outstanding") | May 10, 2013 | PRC | 100 | % | ||||||
Pactera Technology (Mauritius) Limited ("Pactera Mauritius") | August 20, 2013 | Mauritius | 100 | % |
SUMMARY_OF_SIGNIFICANT_ACCOUNT2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended | |||||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||||
Net revenues | Customers | ' | |||||||||||||||||||
Concentration risk | ' | |||||||||||||||||||
Schedule of details of customers accounting for 10% or more of net revenues | ' | |||||||||||||||||||
Details of customers accounting for 10% or more of net revenues were as follows: | ||||||||||||||||||||
Years ended December 31, | ||||||||||||||||||||
2011 | % | 2012 | % | 2013 | % | |||||||||||||||
Client A | 17,826 | 8 | 29,772 | 8 | 69,530 | 10 | ||||||||||||||
Client B | 23,928 | 11 | 26,582 | 7 | 38,512 | 6 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Accounts receivable | Credit concentration | ' | |||||||||||||||||||
Concentration risk | ' | |||||||||||||||||||
Schedule of details of customers accounting for 10% or more of net revenues | ' | |||||||||||||||||||
Details of customer accounting for 10% or more of accounts receivable were as follows: | ||||||||||||||||||||
Years ended | ||||||||||||||||||||
December 31, | ||||||||||||||||||||
2012 | 2013 | |||||||||||||||||||
Client C | 31 | % | 18 | % | ||||||||||||||||
| | | | | | | | |||||||||||||
| | | | | | | | |||||||||||||
SUMMARY_OF_SIGNIFICANT_ACCOUNT3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables 2) | 12 Months Ended | ||||||||||
Dec. 31, 2013 | |||||||||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ' | ||||||||||
Schedule of estimated useful lives of property, plant and equipment | ' | ||||||||||
Building | 30 years | ||||||||||
Furniture, fixtures and electronic equipment & software | 3 – 5 years | ||||||||||
Transportation equipment | 5 years | ||||||||||
Leasehold improvements | Shorter of useful life | ||||||||||
of the asset or the lease term | |||||||||||
Schedule of estimated economic lives or weighted-average amortization period for intangible assets subject to amortization acquired through business combinations | ' | ||||||||||
Customer base and customer relationship | 3 – 6.8 years | ||||||||||
Non-compete agreement | 1 – 5 years | ||||||||||
Contract backlog | 0.5 – 2.14 years | ||||||||||
Trade name | 1 year – Indefinite | ||||||||||
Trademark | 1 – 2 years | ||||||||||
Software Technology | 4 – 5 years | ||||||||||
Schedule of net revenues breakdown by contract type | ' | ||||||||||
Years ended December 31, | |||||||||||
2011 | 2012 | 2013 | |||||||||
Time-and-material | $ | 175,115 | $ | 282,615 | $ | 543,062 | |||||
Fixed-price | 43,874 | 76,416 | 126,957 | ||||||||
| | | | | | | | | | | |
Total | $ | 218,989 | $ | 359,031 | $ | 670,019 | |||||
| | | | | | | | | | | |
| | | | | | | | | | | |
ACQUISITIONS_Tables
ACQUISITIONS (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Beans | ' | |||||||
ACQUISITIONS | ' | |||||||
Schedule of purchase price allocation to assets acquired and liabilities assumed | ' | |||||||
Estimated | ||||||||
useful lives | ||||||||
Intangible assets acquired: | ||||||||
Customer relationship | $ | 927 | 6 years | |||||
Goodwill | 1,115 | |||||||
| | | | | | |||
Total | $ | 2,042 | ||||||
| | | | | | |||
Total consideration | $ | 2,042 | ||||||
| | | | | | |||
| | | | | | |||
Business team of China-based IT service firms | ' | |||||||
ACQUISITIONS | ' | |||||||
Schedule of purchase price allocation to assets acquired and liabilities assumed | ' | |||||||
Estimated | ||||||||
useful lives | ||||||||
Intangible assets acquired: | ||||||||
Contract backlog | $ | 287 | 0.9 year | |||||
Customer relationship | 666 | 4.9 years | ||||||
Goodwill | 1,547 | |||||||
| | | | | | |||
Total consideration | $ | 2,500 | ||||||
| | | | | | |||
| | | | | | |||
Schedule of unaudited pro forma information summarizing the results of operations | ' | |||||||
Year ended | ||||||||
December 31, | ||||||||
2011 | ||||||||
(Unaudited) | ||||||||
Net revenues | $ | 219,197 | ||||||
Net income | 17,715 | |||||||
Net income per share | ||||||||
—Basic | $ | 0.44 | ||||||
| | | | | ||||
| | | | | ||||
—Diluted | $ | 0.41 | ||||||
| | | | | ||||
| | | | | ||||
NouvEON | ' | |||||||
ACQUISITIONS | ' | |||||||
Schedule of purchase price allocation to assets acquired and liabilities assumed | ' | |||||||
Estimated | ||||||||
useful lives | ||||||||
Net liabilities assumed: | ||||||||
Current assets | $ | 830 | ||||||
Current liabilities | (1,879 | ) | ||||||
| | | | | | |||
Total | $ | (1,049 | ) | |||||
| | | | | | |||
Intangible assets acquired: | ||||||||
Customer relationship | 3,300 | 4 years | ||||||
Trademark | 2,900 | Indefinite | ||||||
Backlog | 283 | 1 year | ||||||
Goodwill | 10,930 | |||||||
Deferred tax liability | (2,204 | ) | ||||||
| | | | | | |||
Total | $ | 15,209 | ||||||
| | | | | | |||
Total consideration | $ | 14,160 | ||||||
| | | | | | |||
| | | | | | |||
Schedule of unaudited pro forma information summarizing the results of operations | ' | |||||||
Year ended | ||||||||
December 31, | ||||||||
2011 | ||||||||
(Unaudited) | ||||||||
Net revenues | $ | 225,390 | ||||||
Net income | 17,260 | |||||||
Net income per share | ||||||||
—Basic | $ | 0.43 | ||||||
| | | | | ||||
—Diluted | $ | 0.4 | ||||||
| | | | | ||||
| | | | | ||||
HURO | ' | |||||||
ACQUISITIONS | ' | |||||||
Schedule of purchase price allocation to assets acquired and liabilities assumed | ' | |||||||
Estimated | ||||||||
useful lives | ||||||||
Net tangible assets: | ||||||||
Current assets | $ | 4,375 | ||||||
Current liabilities | (3,825 | ) | ||||||
| | | | | | |||
Total | $ | 550 | ||||||
| | | | | | |||
Intangible assets acquired: | ||||||||
Customer relationship | 1,339 | 5 years | ||||||
Contract backlog | 856 | 1 year | ||||||
Trade name | 1,425 | Indefinite | ||||||
Non-compete agreement | 359 | 5 years | ||||||
Goodwill | 3,361 | |||||||
Deferred tax liability | (597 | ) | ||||||
| | | | | | |||
Total | $ | 6,743 | ||||||
| | | | | | |||
Total consideration | $ | 7,293 | ||||||
| | | | | | |||
| | | | | | |||
Schedule of unaudited pro forma information summarizing the results of operations | ' | |||||||
Year ended | ||||||||
December 31, | ||||||||
2011 | ||||||||
(Unaudited) | ||||||||
Net revenues | $ | 222,856 | ||||||
Net income | 17,514 | |||||||
Net income per share | ||||||||
—Basic | $ | 0.43 | ||||||
| | | | | ||||
—Diluted | $ | 0.41 | ||||||
| | | | | ||||
| | | | | ||||
Logoscript | ' | |||||||
ACQUISITIONS | ' | |||||||
Schedule of purchase price allocation to assets acquired and liabilities assumed | ' | |||||||
Estimated | ||||||||
useful life | ||||||||
Net tangible assets: | ||||||||
Assets | $ | 1,592 | ||||||
Liabilities | (1,150 | ) | ||||||
| | | | | | |||
Total | $ | 442 | ||||||
| | | | | | |||
Intangible assets acquired: | ||||||||
Customer relationship | 233 | 3 years | ||||||
Goodwill | 794 | |||||||
Deferred tax liability | (70 | ) | ||||||
| | | | | | |||
Total | $ | 957 | ||||||
| | | | | | |||
Total consideration | $ | 1,399 | ||||||
| | | | | | |||
| | | | | | |||
Schedule of unaudited pro forma information summarizing the results of operations | ' | |||||||
Years ended December 31, | ||||||||
2011 | 2012 | |||||||
(Unaudited) | (Unaudited) | |||||||
Net revenues | $ | 222,836 | $ | 359,352 | ||||
Net income | 17,458 | 2,553 | ||||||
Net income per share | ||||||||
—Basic | $ | 0.43 | $ | 0.05 | ||||
| | | | | | | | |
| | | | | | | | |
—Diluted | $ | 0.41 | $ | 0.05 | ||||
| | | | | | | | |
| | | | | | | | |
Longhaul | ' | |||||||
ACQUISITIONS | ' | |||||||
Schedule of purchase price allocation to assets acquired and liabilities assumed | ' | |||||||
Estimated | ||||||||
useful lives | ||||||||
Intangible assets acquired: | ||||||||
Customer relationship | 190 | 3.5 years | ||||||
Contract backlog | 27 | 0.25 year | ||||||
Non-compete agreement | 262 | 4 years | ||||||
Goodwill | 1,015 | |||||||
| | | | | | |||
Total | $ | 1,494 | ||||||
| | | | | | |||
Total consideration | $ | 1,494 | ||||||
| | | | | | |||
| | | | | | |||
Schedule of unaudited pro forma information summarizing the results of operations | ' | |||||||
Years ended December 31, | ||||||||
2011 | 2012 | |||||||
(Unaudited) | (Unaudited) | |||||||
Net revenues | $ | 220,733 | $ | 359,322 | ||||
Net income | 17,858 | 2,583 | ||||||
Net income per share | ||||||||
—Basic | $ | 0.44 | 0.05 | |||||
| | | | | | | | |
| | | | | | | | |
—Diluted | $ | 0.42 | 0.05 | |||||
| | | | | | | | |
| | | | | | | | |
Glory | ' | |||||||
ACQUISITIONS | ' | |||||||
Schedule of purchase price allocation to assets acquired and liabilities assumed | ' | |||||||
Estimated | ||||||||
useful lives | ||||||||
Net tangible assets: | ||||||||
Current assets | $ | 1,465 | ||||||
Current liabilities | (1,879 | ) | ||||||
| | | | | | |||
Total | $ | (414 | ) | |||||
| | | | | | |||
Intangible assets acquired: | ||||||||
Customer relationship | 959 | 5 years | ||||||
Contract backlog | 530 | 1 year | ||||||
Trade name | 2,149 | Indefinite | ||||||
Non-compete clause | 225 | 5 years | ||||||
Goodwill | 3,746 | |||||||
Deferred tax liability | (579 | ) | ||||||
| | | | | | |||
Total | $ | 7,030 | ||||||
| | | | | | |||
Total consideration | $ | 6,616 | ||||||
| | | | | | |||
| | | | | | |||
Schedule of unaudited pro forma information summarizing the results of operations | ' | |||||||
Years ended December 31, | ||||||||
2011 | 2012 | |||||||
(Unaudited) | (Unaudited) | |||||||
Net revenues | $ | 223,225 | $ | 360,796 | ||||
Net income | 18,050 | 2,652 | ||||||
Net income per share | ||||||||
—Basic | $ | 0.44 | $ | 0.06 | ||||
| | | | | | | | |
| | | | | | | | |
—Diluted | $ | 0.42 | $ | 0.05 | ||||
| | | | | | | | |
| | | | | | | | |
Bearing Point | ' | |||||||
ACQUISITIONS | ' | |||||||
Schedule of purchase price allocation to assets acquired and liabilities assumed | ' | |||||||
Estimated | ||||||||
useful lives | ||||||||
Net tangible assets: | ||||||||
Assets | $ | 6,729 | ||||||
Liabilities | (5,180 | ) | ||||||
| | | | | | |||
Total | $ | 1,549 | ||||||
| | | | | | |||
Intangible assets acquired: | ||||||||
Customer relationship | 1,845 | 5 years | ||||||
Trade name | 512 | 2 years | ||||||
Goodwill | 4,266 | |||||||
Deferred tax liability | (707 | ) | ||||||
| | | | | | |||
Total | $ | 5,916 | ||||||
| | | | | | |||
Total consideration | $ | 7,465 | ||||||
| | | | | | |||
| | | | | | |||
Schedule of unaudited pro forma information summarizing the results of operations | ' | |||||||
Years ended December 31, | ||||||||
2011 | 2012 | |||||||
(Unaudited) | (Unaudited) | |||||||
Net revenues | $ | 238,002 | $ | 368,538 | ||||
Net income | 17,690 | 2,484 | ||||||
Net income per share | ||||||||
—Basic | $ | 0.44 | $ | 0.05 | ||||
| | | | | | | | |
| | | | | | | | |
—Diluted | $ | 0.41 | $ | 0.05 | ||||
| | | | | | | | |
| | | | | | | | |
Newton | ' | |||||||
ACQUISITIONS | ' | |||||||
Schedule of purchase price allocation to assets acquired and liabilities assumed | ' | |||||||
Estimated | ||||||||
useful lives | ||||||||
Net tangible assets: | ||||||||
Assets | $ | 936 | ||||||
Liabilities | (465 | ) | ||||||
| | | | | | |||
Total | $ | 471 | ||||||
| | | | | | |||
Intangible assets acquired: | ||||||||
Acquired software | 168 | 5 years | ||||||
Contract backlog | 3 | 0.5 year | ||||||
Customer relationship | 434 | 5 years | ||||||
Goodwill | 557 | |||||||
Deferred tax liability | (169 | ) | ||||||
| | | | | | |||
Total | $ | 993 | ||||||
| | | | | | |||
Total consideration | $ | 1,464 | ||||||
| | | | | | |||
| | | | | | |||
Schedule of unaudited pro forma information summarizing the results of operations | ' | |||||||
Years ended December 31, | ||||||||
2011 | 2012 | |||||||
(Unaudited) | (Unaudited) | |||||||
Net revenues | $ | 221,197 | $ | 360,319 | ||||
Net income | 17,425 | 2,313 | ||||||
Net income per share | ||||||||
—Basic | $ | 0.43 | $ | 0.05 | ||||
| | | | | | | | |
| | | | | | | | |
—Diluted | $ | 0.41 | $ | 0.05 | ||||
| | | | | | | | |
| | | | | | | | |
VanceInfo | ' | |||||||
ACQUISITIONS | ' | |||||||
Schedule of purchase price allocation to assets acquired and liabilities assumed | ' | |||||||
Estimated | ||||||||
useful lives | ||||||||
Net tangible assets: | ||||||||
Assets | $ | 319,072 | ||||||
Liabilities | (81,715 | ) | ||||||
| | | | | | |||
Total | $ | 237,357 | ||||||
| | | | | | |||
Intangible assets acquired: | ||||||||
Customer relationship | 11,540 | 4 – 6 years | ||||||
Trade name | 27,840 | 2 years – indefinite | ||||||
Software technology | 2,290 | 4 – 5 years | ||||||
Contract backlog | 910 | 2 years | ||||||
Non-compete agreement | 1,400 | 1 – 4 years | ||||||
Goodwill | 54,407 | |||||||
Deferred tax liability | (8,966 | ) | ||||||
| | | | | | |||
Total | $ | 89,421 | ||||||
| | | | | | |||
Total consideration | $ | 326,778 | ||||||
| | | | | | |||
| | | | | | |||
Schedule of unaudited pro forma information summarizing the results of operations | ' | |||||||
Years ended December 31, | ||||||||
2011 | 2012 | |||||||
(Unaudited) | (Unaudited) | |||||||
Net revenues | $ | 502,126 | $ | 673,266 | ||||
Net income/(loss) | 39,532 | 1,807 | ||||||
Net income/(loss) per share | ||||||||
—Basic | $ | 0.47 | $ | 0.02 | ||||
| | | | | | | | |
| | | | | | | | |
—Diluted | $ | 0.45 | $ | 0.02 | ||||
| | | | | | | | |
| | | | | | | | |
Schedule of total consideration | ' | |||||||
Issuance of common shares | 42,517 | |||||||
Closing price on transaction date | $ | 7.49 | ||||||
| | | | | ||||
Stock consideration | $ | 318,451 | ||||||
Fair value of vested VanceInfo stock options and RSU | 8,327 | |||||||
| | | | | ||||
Total consideration | $ | 326,778 | ||||||
| | | | | ||||
| | | | | ||||
ACCOUNTS_RECEIVABLE_Tables
ACCOUNTS RECEIVABLE (Tables) | 12 Months Ended | ||||||||||
Dec. 31, 2013 | |||||||||||
ACCOUNTS RECEIVABLE | ' | ||||||||||
Schedule of accounts receivable | ' | ||||||||||
As of December 31, | |||||||||||
2012 | 2013 | ||||||||||
Billed receivable | $ | 106,882 | $ | 98,421 | |||||||
Unbilled receivable | 140,197 | 161,675 | |||||||||
| | | | | | | | ||||
247,079 | 260,096 | ||||||||||
Less: Allowance for doubtful accounts | 16,386 | 13,646 | |||||||||
| | | | | | | | ||||
$ | 230,693 | $ | 246,450 | ||||||||
| | | | | | | | ||||
| | | | | | | | ||||
Schedule of movement of the allowance for doubtful accounts | ' | ||||||||||
As of December 31, | |||||||||||
2011 | 2012 | 2013 | |||||||||
Balance at the beginning of the year | $ | 3,698 | $ | 4,002 | $ | 16,386 | |||||
Balance brought forward from VanceInfo | — | 10,197 | — | ||||||||
Allowance for doubtful accounts | 477 | 5,153 | 343 | ||||||||
Write-off | (388 | ) | (2,751 | ) | (2,978 | ) | |||||
Foreign currency translation adjustments | 215 | (215 | ) | (105 | ) | ||||||
| | | | | | | | | | | |
Balance at the end of the year | $ | 4,002 | $ | 16,386 | $ | 13,646 | |||||
| | | | | | | | | | | |
| | | | | | | | | | | |
PREPAID_EXPENSES_AND_OTHER_CUR1
PREPAID EXPENSES AND OTHER CURRENT ASSETS (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
PREPAID EXPENSES AND OTHER CURRENT ASSETS | ' | |||||||
Schedule of prepaid expenses and other current assets | ' | |||||||
As of December 31, | ||||||||
2012 | 2013 | |||||||
Prepaid rent and other prepaid expenses | $ | 8,467 | $ | 11,258 | ||||
Advances to suppliers | 2,449 | 2,969 | ||||||
Deposits | 1,213 | 2,031 | ||||||
Accrued interests receivable | 793 | 717 | ||||||
Advances to employees | 1,055 | 680 | ||||||
Prepayment for building and property | 13,283 | — | ||||||
Other current assets | 1,235 | 1,007 | ||||||
| | | | | | | | |
Total | $ | 28,495 | $ | 18,662 | ||||
| | | | | | | | |
| | | | | | | | |
PROPERTY_PLANT_AND_EQUIPMENT_N1
PROPERTY, PLANT AND EQUIPMENT, NET (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
PROPERTY, PLANT AND EQUIPMENT, NET | ' | |||||||
Schedule of property, plant and equipment | ' | |||||||
As of December 31, | ||||||||
2012 | 2013 | |||||||
Construction in progress | $ | 36,797 | $ | — | ||||
Building | — | 76,458 | ||||||
Furniture, fixtures, electronic equipment and software | 47,591 | 45,320 | ||||||
Transportation equipment | 2,281 | 2,245 | ||||||
Leasehold improvements | 25,209 | 15,849 | ||||||
| | | | | | | | |
111,878 | 139,872 | |||||||
Less: Accumulated depreciation | 44,271 | 44,041 | ||||||
| | | | | | | | |
$ | 67,607 | $ | 95,831 | |||||
| | | | | | | | |
| | | | | | | | |
GOODWILL_Tables
GOODWILL (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
GOODWILL | ' | |||||||
Schedule of changes in carrying amount of goodwill | ' | |||||||
As of December 31 | ||||||||
2012 | 2013 | |||||||
Balance at the beginning of the year | $ | 37,348 | $ | 102,659 | ||||
Goodwill acquired in business acquisitions | 64,785 | — | ||||||
Foreign currency translation adjustments | 526 | (437 | ) | |||||
| | | | | | | | |
Balance at the end of the year | $ | 102,659 | $ | 102,222 | ||||
| | | | | | | | |
| | | | | | | | |
INTANGIBLE_ASSETS_Tables
INTANGIBLE ASSETS (Tables) | 12 Months Ended | ||||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||||
INTANGIBLE ASSETS | ' | ||||||||||||||||||||||
Schedule of intangible assets and their related accumulated amortization | ' | ||||||||||||||||||||||
Contract | Customer | Trade | Trademark | Non-compete | Software | Total | |||||||||||||||||
backlog | base and | name | agreement | technology | |||||||||||||||||||
customer | |||||||||||||||||||||||
relationship | |||||||||||||||||||||||
Balance as of January 1, 2012 | $ | 790 | $ | 8,964 | $ | 2,073 | $ | 3,026 | $ | 345 | $ | — | $ | 15,198 | |||||||||
Acquisition | 1,470 | 15,200 | 29,989 | 513 | 1,887 | 2,459 | 51,518 | ||||||||||||||||
Amortization | (1,611 | ) | (3,400 | ) | (428 | ) | (157 | ) | (225 | ) | (237 | ) | (6,058 | ) | |||||||||
Impairment | — | — | (2,836 | ) | (2,679 | ) | — | — | (5,515 | ) | |||||||||||||
Foreign currency translation adjustments | 3 | 54 | 84 | 9 | 10 | — | 160 | ||||||||||||||||
| | | | | | | | | | | | | | | | | | | | | | | |
Balance as of December 31, 2012 | 652 | 20,818 | 28,882 | 712 | 2,017 | 2,222 | 55,303 | ||||||||||||||||
Amortization | (572 | ) | (5,420 | ) | (2,590 | ) | (694 | ) | (682 | ) | (476 | ) | (10,434 | ) | |||||||||
Foreign currency translation adjustments | 1 | (279 | ) | 22 | (18 | ) | 17 | — | (257 | ) | |||||||||||||
| | | | | | | | | | | | | | | | | | | | | | | |
Balance as of December 31, 2013 | $ | 81 | $ | 15,119 | $ | 26,314 | $ | — | $ | 1,352 | $ | 1,746 | $ | 44,612 | |||||||||
| | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
Gross carrying amount | |||||||||||||||||||||||
Balance as of December 31, 2012 | $ | 3,143 | $ | 26,390 | $ | 29,388 | $ | 877 | $ | 2,246 | $ | 2,459 | $ | 64,503 | |||||||||
Balance as of December 31, 2013 | $ | 3,143 | $ | 26,390 | $ | 29,388 | $ | 877 | $ | 2,246 | $ | 2,459 | $ | 64,503 | |||||||||
| | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
Accumulated amortization | |||||||||||||||||||||||
Balance as of December 31, 2012 | $ | 2,491 | $ | 5,572 | $ | 506 | $ | 165 | $ | 229 | $ | 237 | $ | 9,200 | |||||||||
Balance as of December 31, 2013 | $ | 3,062 | $ | 11,271 | $ | 3,074 | $ | 877 | $ | 894 | $ | 713 | $ | 19,891 | |||||||||
| | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
ACCRUED_EXPENSES_AND_OTHER_PAY1
ACCRUED EXPENSES AND OTHER PAYABLES (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
ACCRUED EXPENSES AND OTHER PAYABLES | ' | |||||||
Schedule of accrued expenses and other payables | ' | |||||||
As of December 31, | ||||||||
2012 | 2013 | |||||||
Employee payroll and welfare payables | $ | 47,697 | $ | 56,008 | ||||
Accrued other operating expenses | 6,074 | 12,501 | ||||||
Other employee welfare payables | 9,148 | 9,307 | ||||||
Subcontractors fees | 7,507 | 8,525 | ||||||
Advance from customers | 7,662 | 5,546 | ||||||
Accrued privatization related cost | — | 5,514 | ||||||
Amounts payable for construction of building | — | 5,120 | ||||||
Accrued merger related cost | 12,290 | 3,886 | ||||||
Advance from transfer of | ||||||||
certain outsourcing business (Note 23) | — | 3,764 | ||||||
Accrued professional fees | 2,136 | 2,345 | ||||||
Accrued travel expenses | 2,262 | 1,192 | ||||||
Accrued rental expenses | 2,815 | 949 | ||||||
Government grant payable | 42 | 796 | ||||||
Deferred revenue | 632 | 385 | ||||||
Amount due to a related party | 136 | — | ||||||
Other payable | 4,643 | 5,920 | ||||||
| | | | | | | | |
Total | $ | 103,044 | $ | 121,758 | ||||
| | | | | | | | |
| | | | | | | | |
FAIR_VALUE_Tables
FAIR VALUE (Tables) | 12 Months Ended | |||||||||||||
Dec. 31, 2013 | ||||||||||||||
FAIR VALUE | ' | |||||||||||||
Schedule of details of the outstanding foreign currency forward contracts | ' | |||||||||||||
As of December 31, | ||||||||||||||
2012 | 2013 | |||||||||||||
Settlement currency in: | ||||||||||||||
U.S. dollar of entity with functional currency in RMB | ||||||||||||||
Notional contract amount (U.S. dollar) | $1,800 | $ | 1,800 | |||||||||||
| | | | | | | ||||||||
| | | | | | | ||||||||
Schedule of fair value measurement of the contingent consideration | ' | |||||||||||||
Unobservable Inputs | Range | |||||||||||||
Estimated contingent consideration payments | $32 – $4,045 | |||||||||||||
Discount rate | 1.55% – 11.70% | |||||||||||||
Timing of cash flows | 0.17 – 2.17 years | |||||||||||||
Summary of the movement of the Group's contingent consideration measured at fair value on recurring basis | ' | |||||||||||||
Contingent consideration as of January 1, 2012 | $ | 18,552 | ||||||||||||
Assumed from the merger with VanceInfo | 16,775 | |||||||||||||
Increase in contingent consideration as a result of business acquisitions | 20,355 | |||||||||||||
Less: Payments made during 2012 | (3,047 | ) | ||||||||||||
Shares issuable in connection with business acquisition | (918 | ) | ||||||||||||
Add: Changes in fair values | (659 | ) | ||||||||||||
Foreign currency translation adjustments | 361 | |||||||||||||
| | | | | ||||||||||
Contingent consideration as of January 1, 2013 | $ | 51,419 | ||||||||||||
Increase in contingent consideration as a result of business acquisitions | 3,294 | |||||||||||||
Less: Cash payments made during 2013 | (22,661 | ) | ||||||||||||
Settlement by issuance of common shares | (3,203 | ) | ||||||||||||
Add: Changes in fair values | (1,164 | ) | ||||||||||||
Foreign currency translation adjustments | (190 | ) | ||||||||||||
| | | | | ||||||||||
Contingent consideration as of December 31, 2013 | $ | 27,495 | ||||||||||||
| | | | | ||||||||||
| | | | | ||||||||||
Including | ||||||||||||||
Current portion of contingent consideration | $ | 23,456 | ||||||||||||
Non-current portion of contingent consideration | $ | 4,039 | ||||||||||||
Schedule of assets and liabilities measured at fair value on a recurring basis | ' | |||||||||||||
Fair Value Measurement at Reporting Date Using | ||||||||||||||
Description | December, 31 | Quoted Prices | Other | Significant | ||||||||||
2012 | in Active | Observable | Unobservable | |||||||||||
Market for | Inputs | Inputs | ||||||||||||
Identical | ||||||||||||||
Liabilities | ||||||||||||||
(Level 1) | (Level 2) | (Level 3) | ||||||||||||
Contingent consideration | $ | (51,419 | ) | — | $ | — | $ | (51,419 | ) | |||||
Foreign currency forward contracts | 8 | — | 8 | — | ||||||||||
| | | | | | | | | | | | | | |
Total | $ | (51,411 | ) | — | $ | 8 | $ | (51,419 | ) | |||||
| | | | | | | | | | | | | | |
| | | | | | | | | | | | | | |
Fair Value Measurement at Reporting Date Using | ||||||||||||||
Description | December, 31 | Quoted Prices | Other | Significant | ||||||||||
2013 | in Active | Observable | Unobservable | |||||||||||
Market for | Inputs | Inputs | ||||||||||||
Identical | ||||||||||||||
Liabilities | ||||||||||||||
(Level 1) | (Level 2) | (Level 3) | ||||||||||||
Contingent consideration | $ | (27,495 | ) | — | $ | — | $ | (27,495 | ) | |||||
Foreign currency forward contracts | 14 | — | 14 | — | ||||||||||
| | | | | | | | | | | | | | |
Total | $ | (27,481 | ) | — | $ | 14 | $ | (27,495 | ) | |||||
| | | | | | | | | | | | | | |
| | | | | | | | | | | | | | |
(b) | ||||||||||||||
Schedule of fair value measurements of the intangible assets | ' | |||||||||||||
Unobservable Inputs | Range | |||||||||||||
Estimated net revenues | $1,400 – $30,316 | |||||||||||||
Royalty savings | 2% – 4% | |||||||||||||
Discount rate | 16% | |||||||||||||
Timing of cash flows | 1 – 2 years |
INCOME_TAXES_Tables
INCOME TAXES (Tables) | 12 Months Ended | |||||||||||||
Dec. 31, 2013 | ||||||||||||||
INCOME TAXES | ' | |||||||||||||
Schedule of current and deferred components of income tax expense | ' | |||||||||||||
Years ended December 31, | ||||||||||||||
2011 | 2012 | 2013 | ||||||||||||
Current tax expense | ||||||||||||||
—PRC and Hong Kong | $ | 968 | $ | 5,295 | $ | 5,404 | ||||||||
—Japan | 78 | 41 | 61 | |||||||||||
—U.S. | 330 | 10 | 299 | |||||||||||
—Singapore | 1,006 | 670 | 515 | |||||||||||
—Australia | — | 91 | 1,239 | |||||||||||
—Europe | — | — | 67 | |||||||||||
| | | | | | | | | | | ||||
2,382 | 6,107 | 7,585 | ||||||||||||
| | | | | | | | | | | ||||
Deferred tax expense (benefit) | ||||||||||||||
—PRC and Hong Kong | (881 | ) | (2,070 | ) | (293 | ) | ||||||||
—Japan | (42 | ) | (102 | ) | (802 | ) | ||||||||
—U.S. | 241 | (2,486 | ) | (1,181 | ) | |||||||||
—Singapore | 18 | (81 | ) | (276 | ) | |||||||||
—Australia | — | (155 | ) | 226 | ||||||||||
—Europe | — | (3 | ) | (291 | ) | |||||||||
| | | | | | | | | | | ||||
(664 | ) | (4,897 | ) | (2,617 | ) | |||||||||
| | | | | | | | | | | ||||
Income tax expense | $ | 1,718 | $ | 1,210 | $ | 4,968 | ||||||||
| | | | | | | | | | | ||||
| | | | | | | | | | | ||||
Schedule of the preferential tax rates | ' | |||||||||||||
Subsidiaries | 0% | 10% | 12.50% | 15% | ||||||||||
Pactera Dalian(1)(9) | — | 2011 – 2013 | — | — | ||||||||||
Pactera Shenzhen Systems(3) | — | — | — | 2011 – 2013 | ||||||||||
Pactera Chengdu(1) | — | — | — | 2011 – 2013 | ||||||||||
HiSoft Beijing(1) | — | — | — | 2011 – 2013 | ||||||||||
Pactera Wuxi(2) | 2011 | — | 2012 – 2013 | — | ||||||||||
HURO(1) | — | — | — | 2011 – 2013 | ||||||||||
Pactera Jinxin(1) | — | — | — | 2012 – 2013 | ||||||||||
Glory(1) | — | — | — | 2011 – 2013 | ||||||||||
Pactera Beijing(4) | — | 2011 – 2012 | — | 2013 | ||||||||||
Pactera Nanjing(5) | — | — | 2011 – 2013 | — | ||||||||||
Pactera Shenzhen(6) | 2011 | 2013 | 2012 | — | ||||||||||
Beijing DPC(7) | — | — | — | 2011 – 2013 | ||||||||||
Pactera Shanghai(8) | — | 2011 – 2012 | — | 2013 | ||||||||||
Sunwin(1) | — | — | — | 2012 – 2013 | ||||||||||
-1 | ||||||||||||||
The "High and New Technology Enterprise" (the "new HNTE") status obtained by Pactera Dalian, Pactera Chengdu, HiSoft Beijing, HURO and Glory in 2011, while Pactera Jinxin and Sunwin in 2012, under the Enterprise Income Tax Law (the "EIT Law") effective on January 1, 2008, are valid for three years and qualifying entities can re-apply for an additional three years provided their business operations continue to qualify for the new HNTE status. | ||||||||||||||
-2 | ||||||||||||||
Pactera Wuxi was certified as software enterprise in 2010. Starting from 2010, Pactera Wuxi is entitled to a two-year tax exemption followed by a three-year of 50% deduction of its income tax. | ||||||||||||||
-3 | ||||||||||||||
In 2010, Pactera Shenzhen Systems was certified as "Advanced Technology Service Enterprise" and entitled to an income tax rate of 15% from January 1, 2010 to December 31, 2013. | ||||||||||||||
-4 | ||||||||||||||
Pactera Beijing obtained the new HNTE in 2008 and the HNTE certificate was renewed in 2011. Pactera Beijing was further recognized as a "key software enterprise under the State plan" in 2012, which entitled it to a 10% preferential income tax rate in 2011 and 2012. For 2013, Pactera Beijing would enjoy the preferential income tax rate of 15% as HNTE. | ||||||||||||||
-5 | ||||||||||||||
Pactera Nanjing obtained the certificate of new setup software enterprise in 2009 and was entitled to an exemption of EIT from 2009 to 2010 and 50% reduction for the subsequent three years at the preferential tax rate of 12.5% from 2011 to 2013. | ||||||||||||||
-6 | ||||||||||||||
Pactera Shenzhen obtained the approved newly established IC design software enterprise and qualified software enterprise in 2010 and was entitled to an exemption of EIT in 2010 and 2011 and 50% reduction for the subsequent three years at the preferential tax rate of 12.5% from 2012 to 2014. It was further recognized as a "key software enterprise under the State plan" in 2013, which would entitle it to a 10% preferential income tax rate in 2013 and 2014. | ||||||||||||||
-7 | ||||||||||||||
Beijing DPC was qualified for the new HNTE and the certificate was renewed in 2012. As such, it is entitled to 15% tax rate from 2011 to 2013. | ||||||||||||||
-8 | ||||||||||||||
Pactera Shanghai was qualified as the new HNTE in December 2009, and was further recognized as a "key software enterprise under the State plan" in December 2009 and 2012, respectively, which entitled it to a 10% preferential income tax rate in 2009 through 2012. Pactera Shanghai obtained the advanced technology service enterprises certificate in 2010 and renewed the certificate in 2012, which makes it eligible for a 15% income tax rate in 2013. | ||||||||||||||
-9 | ||||||||||||||
Pactera Dalian was further recognized as a "key software enterprise under the State plan" in 2012 and 2013, respectively, which would entitle it to a 10% preferential income tax rate from 2011 to 2014. | ||||||||||||||
Schedule of principal components of the Group's deferred income tax assets and liabilities | ' | |||||||||||||
Years ended December 31, | ||||||||||||||
2011 | 2012 | 2013 | ||||||||||||
Deferred tax assets | ||||||||||||||
Gross | $ | 5,949 | $ | 16,829 | $ | 17,681 | ||||||||
Less: Valuation allowance | (5,033 | ) | (4,596 | ) | (4,531 | ) | ||||||||
| | | | | | | | | | | ||||
Total net deferred tax assets | 916 | 12,233 | 13,150 | |||||||||||
| | | | | | | | | | | ||||
Deferred tax assets—current: | ||||||||||||||
Allowance for doubtful accounts | 1,954 | 2,742 | 1,667 | |||||||||||
Accrued expenses | 131 | 6,217 | 6,249 | |||||||||||
| | | | | | | | | | | ||||
Total deferred taxes assets—current | 2,085 | 8,959 | 7,916 | |||||||||||
Less: Valuation allowance | (1,462 | ) | (19 | ) | (130 | ) | ||||||||
| | | | | | | | | | | ||||
Net deferred tax assets—current, net | 623 | 8,940 | 7,786 | |||||||||||
| | | | | | | | | | | ||||
| | | | | | | | | | | ||||
Deferred tax assets—non-current: | ||||||||||||||
Net operating losses | 3,811 | 6,975 | 9,138 | |||||||||||
Depreciation | 53 | 895 | 627 | |||||||||||
| | | | | | | | | | | ||||
Total deferred taxes assets—non-current | 3,864 | 7,870 | 9,765 | |||||||||||
Less: Valuation allowance | (3,571 | ) | (4,577 | ) | (4,401 | ) | ||||||||
| | | | | | | | | | | ||||
Net deferred tax assets—non-current, net | 293 | 3,293 | 5,364 | |||||||||||
| | | | | | | | | | | ||||
Current deferred tax liabilities: | ||||||||||||||
Depreciation | (8 | ) | — | — | ||||||||||
Unbilled account receivables | — | (411 | ) | (352 | ) | |||||||||
| | | | | | | | | | | ||||
Current deferred tax liabilities | (8 | ) | (411 | ) | (352 | ) | ||||||||
| | | | | | | | | | | ||||
| | | | | | | | | | | ||||
Non-current deferred tax liabilities: | ||||||||||||||
Intangible assets | (3,017 | ) | (11,145 | ) | (9,312 | ) | ||||||||
Depreciation | (88 | ) | (116 | ) | (133 | ) | ||||||||
| | | | | | | | | | | ||||
Non-current deferred tax liabilities | $ | (3,105 | ) | $ | (11,261 | ) | $ | (9,445 | ) | |||||
| | | | | | | | | | | ||||
| | | | | | | | | | | ||||
Schedule of reconciliation between income tax expense computed by applying the PRC tax rate to income before income tax and the income tax expense | ' | |||||||||||||
Years ended December 31, | ||||||||||||||
2011 | 2012 | 2013 | ||||||||||||
Tax expenses at statutory tax rate in PRC | $ | 5,029 | $ | 1,128 | $ | 3,184 | ||||||||
Permanent differences | 551 | 314 | 695 | |||||||||||
Different tax jurisdictions | 306 | 3,253 | 6,556 | |||||||||||
Tax holiday in the PRC | (4,788 | ) | (3,102 | ) | (4,225 | ) | ||||||||
Change in valuation allowance | 861 | (437 | ) | (65 | ) | |||||||||
Preferential tax refund | — | — | (1,724 | ) | ||||||||||
Other | (241 | ) | 54 | 547 | ||||||||||
| | | | | | | | | | | ||||
Income tax expense | $ | 1,718 | $ | 1,210 | $ | 4,968 | ||||||||
| | | | | | | | | | | ||||
| | | | | | | | | | | ||||
Schedule of components of consolidated income before income tax expense as either domestic or foreign | ' | |||||||||||||
Years ended December 31, | ||||||||||||||
2011 | 2012 | 2013 | ||||||||||||
Domestic (Cayman Islands) | $ | (7,125 | ) | $ | (22,937 | ) | $ | (26,246 | ) | |||||
Foreign (PRC) | 18,873 | 19,795 | 26,887 | |||||||||||
Foreign (Others) | 8,368 | 7,654 | 12,096 | |||||||||||
| | | | | | | | | | | ||||
Income before income tax expense | $ | 20,116 | $ | 4,512 | $ | 12,737 | ||||||||
| | | | | | | | | | | ||||
| | | | | | | | | | | ||||
SHAREBASED_COMPENSATION_PLAN_T
SHARE-BASED COMPENSATION PLAN (Tables) | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||||||
SHARE-BASED COMPENSATION PLAN | ' | ||||||||||||||||||||||||
Schedule of assumptions presented in weighted average, used to estimate fair value of each option granted | ' | ||||||||||||||||||||||||
The fair value of each option granted was estimated on the date of grant by the Group and was determined using the Black-Scholes options-pricing model with the following assumptions, presented in weighted average, for the years ended December 31, 2011, 2012 and 2013, respectively, except for the options assumed under the merger of equals with VanceInfo on November 9, 2012: | |||||||||||||||||||||||||
2011 | 2012 | 2013 | |||||||||||||||||||||||
Expected volatility(1) | 53% | 53% | 50% – 51% | ||||||||||||||||||||||
Risk-free interest rate(2) | 1.44% – 2.90% | 1.04% | 1.18% – 1.23% | ||||||||||||||||||||||
Expected life (years)(3) | 5.5 – 6.1 | 6.5 | 5.87 – 6.11 | ||||||||||||||||||||||
Expected dividend yield(4) | — | — | — | ||||||||||||||||||||||
Exercise price(5) | $8.79 – $22.18 | $ | 7.25 | $6.42 – $7.94 | |||||||||||||||||||||
Fair value of the underlying common shares(6) | $8.79 – $22.18 | $ | 7.49 | $6.42 – $7.94 | |||||||||||||||||||||
-1 | |||||||||||||||||||||||||
Volatility | |||||||||||||||||||||||||
The volatility of the underlying common shares during the life of the options was estimated based on average historical volatility of comparable companies for the period before the valuation date with lengths equal to the expected terms of the options. | |||||||||||||||||||||||||
-2 | |||||||||||||||||||||||||
Risk-free interest rate | |||||||||||||||||||||||||
Risk free interest rate is estimated based on the yield to maturity of China international government bonds with maturity term close to expected term of the options. | |||||||||||||||||||||||||
-3 | |||||||||||||||||||||||||
Expected term | |||||||||||||||||||||||||
As the Group did not have historical share option exercise experience, it estimated the expected term based on a consideration of factors including contractual term, vesting period and empirical study on exercise behavior of employee share option. | |||||||||||||||||||||||||
-4 | |||||||||||||||||||||||||
Dividend yield | |||||||||||||||||||||||||
The dividend yield was estimated by the Group based on its expected dividend policy over the expected term of the options. | |||||||||||||||||||||||||
-5 | |||||||||||||||||||||||||
Exercise price | |||||||||||||||||||||||||
The exercise price of the options was determined by the Company's board of directors. | |||||||||||||||||||||||||
-6 | |||||||||||||||||||||||||
Fair value of underlying common shares | |||||||||||||||||||||||||
The fair value of the underlying common shares is estimated based on the closing market price of the ADS of the Company as of the grant date to derive the fair value of the common shares on that date. | |||||||||||||||||||||||||
The fair value of the options granted under the merger of equals with VanceInfo on November 9, 2012 was estimated with the assistance of an independent third-party appraiser, and was determined using binomial model with the following assumptions: | |||||||||||||||||||||||||
Expected volatility(1) | 52.0% – 66.0% | ||||||||||||||||||||||||
Risk-free interest rate(2) | 0.7% – 1.4% | ||||||||||||||||||||||||
Expected dividend yield(3) | Nil | ||||||||||||||||||||||||
Exercise price(4) | $4.58 – $11.00 | ||||||||||||||||||||||||
Fair value of the underlying common shares(5) | $7.49 | ||||||||||||||||||||||||
-1 | |||||||||||||||||||||||||
Volatility | |||||||||||||||||||||||||
The volatility of the underlying common shares during the life of the options was estimated based on average historical volatility of comparable companies for the period before the valuation date with lengths equal to the life of the options. | |||||||||||||||||||||||||
-2 | |||||||||||||||||||||||||
Risk-free interest rate | |||||||||||||||||||||||||
Risk free rate is estimated based on yield to maturity of China international government bonds with maturity term close to the life of the options. | |||||||||||||||||||||||||
-3 | |||||||||||||||||||||||||
Dividend yield | |||||||||||||||||||||||||
The dividend yield was estimated by the Group based on its expected dividend policy over the life of the options. | |||||||||||||||||||||||||
-4 | |||||||||||||||||||||||||
Exercise price | |||||||||||||||||||||||||
The exercise price of the options was determined by the Group's board of directors. | |||||||||||||||||||||||||
-5 | |||||||||||||||||||||||||
Fair value of underlying common shares | |||||||||||||||||||||||||
The fair value of the common shares underlying was estimated based on the closing market price of the ADS of VanceInfo as of the grant date to derive the fair value of the common shares on that date. | |||||||||||||||||||||||||
Schedule of share-based compensation expenses included in the consolidated statements of operations | ' | ||||||||||||||||||||||||
2011 | 2012 | 2013 | |||||||||||||||||||||||
Cost of revenues | $ | 234 | $ | 165 | $ | 466 | |||||||||||||||||||
General and administrative | 4,906 | 10,405 | 21,466 | ||||||||||||||||||||||
Selling and marketing | 516 | 494 | 926 | ||||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
Total | $ | 5,656 | $ | 11,064 | $ | 22,858 | |||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
| | | | | | | | | | | |||||||||||||||
Share Incentive Plan | ' | ||||||||||||||||||||||||
SHARE-BASED COMPENSATION PLAN | ' | ||||||||||||||||||||||||
Schedule of changes in options outstanding | ' | ||||||||||||||||||||||||
Number of | Weighted average | Weighted average | Weighted average | ||||||||||||||||||||||
share options | exercise price | grant-date | intrinsic value | ||||||||||||||||||||||
fair value | per option at the | ||||||||||||||||||||||||
grant dates | |||||||||||||||||||||||||
Share options outstanding as of January 1, 2011 | 4,508,784 | $ | 4.46 | ||||||||||||||||||||||
Granted | 114,685 | 16.74 | $ | 8.93 | — | ||||||||||||||||||||
Exercised | (1,007,740 | ) | 4.18 | ||||||||||||||||||||||
Cancelled | (217,539 | ) | 9.76 | ||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||
Share options outstanding as of December 31, 2011 | 3,398,190 | $ | 4.6 | ||||||||||||||||||||||
Granted | — | — | — | — | |||||||||||||||||||||
Exercised | (401,179 | ) | 4.34 | ||||||||||||||||||||||
Cancelled | (81,840 | ) | 6.64 | ||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||
Share options outstanding as of December 31, 2012 | 2,915,171 | $ | 4.58 | — | — | ||||||||||||||||||||
Granted | — | — | |||||||||||||||||||||||
Exercised | (691,372 | ) | 4.64 | ||||||||||||||||||||||
Cancelled | (83,608 | ) | 11.26 | ||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||
Share options outstanding as of December 31, 2013 | 2,140,191 | $ | 4.37 | ||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||
| | | | | | | | | | | | | | ||||||||||||
Schedule of information with respect to stock options outstanding by exercise price range | ' | ||||||||||||||||||||||||
Options outstanding | Options exercisable | ||||||||||||||||||||||||
Number | Weighted | Weighted | Aggregate | Number | Weighted | Weighted | Aggregate | ||||||||||||||||||
outstanding | average | average | intrinsic | exercisable | average | average | intrinsic | ||||||||||||||||||
remaining | exercise | value | remaining | exercise | value | ||||||||||||||||||||
contractual | price | contractual | price | ||||||||||||||||||||||
life in years | life in years | ||||||||||||||||||||||||
2,140,191 | 3.4 | $ | 4.37 | $ | 6,013,406 | 2,134,557 | 3.39 | $ | 4.36 | $ | 6,008,441 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | | | | | ||
| | | | | | | | | | | | | | | | | | | | | | | | ||
Summary of the status of the Group's options to be vested and changes during the period | ' | ||||||||||||||||||||||||
Options to be vested | Share options | Weighted-average | Weighted-average | ||||||||||||||||||||||
grant date | exercise price | ||||||||||||||||||||||||
fair value | per share | ||||||||||||||||||||||||
As of January 1, 2011 | 1,361,483 | $ | 2.51 | $ | 5.58 | ||||||||||||||||||||
Granted | 114,685 | 8.93 | 16.74 | ||||||||||||||||||||||
Vested | (704,248 | ) | 1.67 | 5.3 | |||||||||||||||||||||
Forfeited | (217,539 | ) | 4.18 | 9.76 | |||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
As of December 31, 2011 | 554,381 | $ | 4.88 | $ | 6.56 | ||||||||||||||||||||
Granted | — | — | — | ||||||||||||||||||||||
Vested | (357,282 | ) | 3.01 | 5.79 | |||||||||||||||||||||
Forfeited | (81,840 | ) | 9.21 | 6.64 | |||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
As of December 31, 2012 | 115,259 | $ | 7.63 | $ | 8.88 | ||||||||||||||||||||
Granted | — | — | — | ||||||||||||||||||||||
Vested | (26,017 | ) | 1.39 | (8.49 | ) | ||||||||||||||||||||
Forfeited | (83,608 | ) | 4.91 | 11.26 | |||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
As of December 31, 2013 | 5,634 | $ | 5.76 | $ | 8.47 | ||||||||||||||||||||
Vested and expect to vest as of December 31, 2013 | 4,593,188 | $ | 4.32 | ||||||||||||||||||||||
Summary of information regarding nonvested shares granted | ' | ||||||||||||||||||||||||
Number of | Weighted average | Intrinsic | |||||||||||||||||||||||
nonvested shares | grant date | value | |||||||||||||||||||||||
fair value | |||||||||||||||||||||||||
Outstanding as of January 1, 2011 | 337,443 | $ | 8.37 | $ | 2,806,766 | ||||||||||||||||||||
Granted | 361,256 | 12.83 | 4,650,290 | ||||||||||||||||||||||
Vested | (273,850 | ) | 6.83 | (1,876,338 | ) | ||||||||||||||||||||
Forfeited | (15,722 | ) | 9.07 | (143,571 | ) | ||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
Outstanding as of December 31, 2011 | 409,127 | $ | 13.25 | $ | 5,437,147 | ||||||||||||||||||||
Granted | 2,719 | 11.02 | 29,960 | ||||||||||||||||||||||
Vested | (156,072 | ) | 13.06 | (2,038,640 | ) | ||||||||||||||||||||
Forfeited | (28,366 | ) | 11.5 | (326,168 | ) | ||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
Outstanding as of December 31, 2012 | 227,408 | $ | 13.57 | $ | 3,102,299 | ||||||||||||||||||||
Vested | (57,373 | ) | 13.95 | (800,353 | ) | ||||||||||||||||||||
Forfeited | (3,406 | ) | 18.06 | (61,512 | ) | ||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
Outstanding as of December 31, 2013 | 166,629 | $ | 13.45 | $ | 2,240,434 | ||||||||||||||||||||
Nonvested shares vested and expect to vest as of December 31, 2013 | 1,686,203 | ||||||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
| | | | | | | | | | | |||||||||||||||
2011 Equity Incentive Plan | ' | ||||||||||||||||||||||||
SHARE-BASED COMPENSATION PLAN | ' | ||||||||||||||||||||||||
Schedule of changes in options outstanding | ' | ||||||||||||||||||||||||
Number of | Weighted average | Weighted average | Weighted average | ||||||||||||||||||||||
share options | exercise price | grant-date | intrinsic value | ||||||||||||||||||||||
fair value | per option at the | ||||||||||||||||||||||||
grant dates | |||||||||||||||||||||||||
Granted | 34,055 | $ | 8.79 | $ | 4.32 | — | |||||||||||||||||||
Exercised | — | — | |||||||||||||||||||||||
Cancelled | — | — | |||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||
Share options outstanding as of December 31, 2011 | 34,055 | $ | 8.79 | ||||||||||||||||||||||
Granted | 215,084 | $ | 7.25 | $ | 3.77 | — | |||||||||||||||||||
Exercised | — | — | |||||||||||||||||||||||
Cancelled | — | — | |||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||
Share options outstanding as of December 31, 2012 | 249,139 | $ | 7.46 | ||||||||||||||||||||||
Granted | 40,100 | $ | 7.75 | $ | 3.75 | — | |||||||||||||||||||
Exercised | — | — | |||||||||||||||||||||||
Cancelled | (43,623 | ) | $ | 8.2 | |||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||
Share options outstanding as of December 31, 2013 | 245,616 | $ | 7.38 | ||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||
| | | | | | | | | | | | | | ||||||||||||
Schedule of information with respect to stock options outstanding by exercise price range | ' | ||||||||||||||||||||||||
Options outstanding | Options exercisable | ||||||||||||||||||||||||
Number | Weighted | Weighted | Aggregate | Number | Weighted | Weighted | Aggregate | ||||||||||||||||||
outstanding | average | average | intrinsic | exercisable | average | average | intrinsic | ||||||||||||||||||
remaining | exercise | value | remaining | exercise | value | ||||||||||||||||||||
contractual | price | contractual | price | ||||||||||||||||||||||
life in years | life in years | ||||||||||||||||||||||||
245,616 | 8.04 | $ | 7.38 | $ | 3,650 | 20,433 | 7.86 | $ | 8.79 | — | |||||||||||||||
| | | | | | | | | | | | | | | | | | | | | | | | ||
| | | | | | | | | | | | | | | | | | | | | | | | ||
Summary of the status of the Group's options to be vested and changes during the period | ' | ||||||||||||||||||||||||
Options to be vested | Share options | Weighted-average | Weighted-average | ||||||||||||||||||||||
grant date | exercise price | ||||||||||||||||||||||||
fair value | per share | ||||||||||||||||||||||||
Granted in 2011 | 34,055 | $ | 4.32 | $ | 8.79 | ||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
As of December 31, 2011 | 34,055 | $ | 4.32 | $ | 8.79 | ||||||||||||||||||||
Granted | 215,082 | 3.77 | 7.25 | ||||||||||||||||||||||
Vested | (34,055 | ) | 4.32 | 8.79 | |||||||||||||||||||||
Forfeited | 2 | 3.89 | 7.6 | ||||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
As of December 31, 2012 | 215,084 | $ | 3.77 | $ | 7.25 | ||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
Granted | 40,100 | 3.75 | 7.75 | ||||||||||||||||||||||
Forfeited | (30,001 | ) | 3.83 | 7.94 | |||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
As of December 31, 2013 | 225,183 | $ | 4.02 | $ | 7.25 | ||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
| | | | | | | | | | | |||||||||||||||
Vested and expect to vest as of December 31, 2013 | 245,616 | $ | 7.38 | ||||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
| | | | | | | | | | | |||||||||||||||
Summary of information regarding nonvested restricted share units | ' | ||||||||||||||||||||||||
Number of | Weighted average | Intrinsic | |||||||||||||||||||||||
nonvested | grant date | value | |||||||||||||||||||||||
share units | fair value | ||||||||||||||||||||||||
Outstanding as of January 1, 2012 | 1,045,698 | $ | 10.18 | $ | 10,600,967 | ||||||||||||||||||||
Granted | 3,833,474 | 7.83 | 30,027,735 | ||||||||||||||||||||||
Vested | (291,513 | ) | 10.41 | (3,034,746 | ) | ||||||||||||||||||||
Forfeited | (120,680 | ) | 10.95 | (1,321,957 | ) | ||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
Outstanding as of December 31, 2012 | 4,466,979 | $ | 8.13 | $ | 36,271,999 | ||||||||||||||||||||
Granted | 1,899,121 | 7.3 | 13,863,583 | ||||||||||||||||||||||
Vested | (210,086 | ) | 8.88 | (1,865,564 | ) | ||||||||||||||||||||
Forfeited | (401,794 | ) | 8.18 | (3,286,675 | ) | ||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
Outstanding as of December 31, 2013 | 5,754,220 | $ | 7.55 | $ | 44,983,343 | ||||||||||||||||||||
Nonvested shares vested and expect to vest as of December 31, 2013 | 6,255,819 | ||||||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
| | | | | | | | | | | |||||||||||||||
VanceInfo 2005 Stock Option Plan | ' | ||||||||||||||||||||||||
SHARE-BASED COMPENSATION PLAN | ' | ||||||||||||||||||||||||
Schedule of changes in options outstanding | ' | ||||||||||||||||||||||||
Number of | Weighted average | Weighted average | Weighted average | ||||||||||||||||||||||
share options | exercise price | grant-date | intrinsic value | ||||||||||||||||||||||
fair value | per option at the | ||||||||||||||||||||||||
grant dates | |||||||||||||||||||||||||
Assumed as of November 9, 2012 | 1,093,435 | $ | 1.9 | $ | 1.31 | $ | 6,118,710 | ||||||||||||||||||
Exercised | (61,340 | ) | $ | 0.78 | |||||||||||||||||||||
Cancelled | — | — | |||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||
Share options outstanding as of December 31, 2012 | 1,032,095 | $ | 1.97 | ||||||||||||||||||||||
Exercised | (223,715 | ) | $ | 1.78 | |||||||||||||||||||||
Cancelled | (1,588 | ) | $ | 6.95 | |||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||
Share options outstanding as of December 31, 2013 | 806,792 | $ | 2.01 | ||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||
| | | | | | | | | | | | | | ||||||||||||
Schedule of information with respect to stock options outstanding by exercise price range | ' | ||||||||||||||||||||||||
Options outstanding | Options exercisable | ||||||||||||||||||||||||
Number | Weighted | Weighted | Aggregate | Number | Weighted | Weighted | Aggregate | ||||||||||||||||||
outstanding | average | average | intrinsic | exercisable | average | average | intrinsic | ||||||||||||||||||
remaining | exercise | value | remaining | exercise | value | ||||||||||||||||||||
contractual | price | contractual | price | ||||||||||||||||||||||
life in years | life in years | ||||||||||||||||||||||||
806,792 | 2.3 | $ | 2.01 | $ | 4,153,648 | 806,792 | 2.3 | $ | 2.01 | $ | 4,153,648 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | | | | | ||
| | | | | | | | | | | | | | | | | | | | | | | | ||
Summary of the status of the Group's options to be vested and changes during the period | ' | ||||||||||||||||||||||||
Options to be vested | Share options | Weighted-average | Weighted-average | ||||||||||||||||||||||
grant date | exercise price | ||||||||||||||||||||||||
fair value | per share | ||||||||||||||||||||||||
Assumed as of November 9, 2012 | 1,093,435 | $ | 1.31 | $ | 1.9 | ||||||||||||||||||||
Vested | (125 | ) | 1.71 | 3.5 | |||||||||||||||||||||
Forfeited | — | — | — | ||||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
As of December 31, 2012 | 1,093,310 | $ | 1.31 | $ | 1.9 | ||||||||||||||||||||
Vested | (1,093,310 | ) | 1.31 | 1.9 | |||||||||||||||||||||
Forfeited | — | — | — | ||||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
As of December 31, 2013 | — | — | — | ||||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
| | | | | | | | | | | |||||||||||||||
Vested and expect to vest as of December 31, 2013 | 1,093,435 | $ | 1.9 | ||||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
| | | | | | | | | | | |||||||||||||||
VanceInfo 2007 Share Incentive Plan | ' | ||||||||||||||||||||||||
SHARE-BASED COMPENSATION PLAN | ' | ||||||||||||||||||||||||
Schedule of changes in options outstanding | ' | ||||||||||||||||||||||||
Number of | Weighted average | Weighted average | Weighted average | ||||||||||||||||||||||
share options | exercise price | grant-date | intrinsic value | ||||||||||||||||||||||
fair value | per option at the | ||||||||||||||||||||||||
grant dates | |||||||||||||||||||||||||
Assumed as of November 9, 2012 | 2,557,084 | $ | 7.56 | $ | 6.18 | $ | 1,138,653 | ||||||||||||||||||
Exercised | (25,908 | ) | $ | 5.53 | |||||||||||||||||||||
Cancelled | (49,088 | ) | $ | 7.96 | |||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||
Share options outstanding as of December 31, 2012 | 2,482,088 | $ | 7.57 | ||||||||||||||||||||||
Exercised | (111,844 | ) | $ | 5.3 | |||||||||||||||||||||
Cancelled | (458,385 | ) | $ | 7.87 | |||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||
Share options outstanding as of December 31, 2013 | 1,911,859 | $ | 7.63 | ||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||
| | | | | | | | | | | | | | ||||||||||||
Schedule of information with respect to stock options outstanding by exercise price range | ' | ||||||||||||||||||||||||
Options outstanding | Options exercisable | ||||||||||||||||||||||||
Number | Weighted | Weighted | Aggregate | Number | Weighted | Weighted | Aggregate | ||||||||||||||||||
outstanding | average | average | intrinsic | exercisable | average | average | intrinsic | ||||||||||||||||||
remaining | exercise | value | remaining | exercise | value | ||||||||||||||||||||
contractual | price | contractual | price | ||||||||||||||||||||||
life in years | life in years | ||||||||||||||||||||||||
1,911,859 | 2.64 | $ | 7.63 | $ | 567,787 | 1,316,968 | 2.25 | $ | 7.51 | $ | 537,201 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | | | | | ||
| | | | | | | | | | | | | | | | | | | | | | | | ||
Summary of the status of the Group's options to be vested and changes during the period | ' | ||||||||||||||||||||||||
Options to be vested | Share options | Weighted-average | Weighted-average | ||||||||||||||||||||||
grant date | exercise price | ||||||||||||||||||||||||
fair value | per share | ||||||||||||||||||||||||
Assumed as of November 9, 2012 | 2,557,084 | $ | 6.18 | $ | 7.56 | ||||||||||||||||||||
Vested | (81,381 | ) | 3.47 | 6.57 | |||||||||||||||||||||
Forfeited | (49,088 | ) | 8.35 | 7.96 | |||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
As of December 31, 2012 | 2,426,615 | $ | 6.23 | $ | 7.58 | ||||||||||||||||||||
Vested | (1,373,339 | ) | 8.32 | 8.09 | |||||||||||||||||||||
Forfeited | (458,385 | ) | 6.58 | 7.87 | |||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
As of December 31, 2013 | 594,891 | $ | 7.21 | $ | 7.9 | ||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
| | | | | | | | | | | |||||||||||||||
Vested and expect to vest as of December 31, 2013 | 2,049,611 | $ | 7.48 | ||||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
| | | | | | | | | | | |||||||||||||||
Summary of information regarding nonvested restricted share units | ' | ||||||||||||||||||||||||
Number of | Weighted average | Intrinsic | |||||||||||||||||||||||
nonvested | grant date | value | |||||||||||||||||||||||
share units | fair value | ||||||||||||||||||||||||
Granted as of November 9, 2012 | 722,869 | $ | 16.56 | $ | 11,968,510 | ||||||||||||||||||||
Vested | (14,738 | ) | 16.23 | (239,145 | ) | ||||||||||||||||||||
Forfeited | (24,157 | ) | 14.13 | (341,308 | ) | ||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
Outstanding as of December 31, 2012 | 683,974 | $ | 16.65 | $ | 11,388,057 | ||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
Vested | (250,704 | ) | 17.52 | (4,392,334 | ) | ||||||||||||||||||||
Forfeited | (99,355 | ) | 18.37 | (1,825,151 | ) | ||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
Outstanding as of December 31, 2013 | 333,915 | $ | 15.48 | $ | 5,170,572 | ||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
| | | | | | | | | | | |||||||||||||||
Nonvested shares vested and expect to vest as of December 31, 2013 | 599,357 | ||||||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
| | | | | | | | | | | |||||||||||||||
Performance based share award options and nonvested shares | ' | ||||||||||||||||||||||||
SHARE-BASED COMPENSATION PLAN | ' | ||||||||||||||||||||||||
Summary of information regarding nonvested restricted share units | ' | ||||||||||||||||||||||||
Number of | Weighted average | Intrinsic | |||||||||||||||||||||||
share units | grant date | value | |||||||||||||||||||||||
fair value | |||||||||||||||||||||||||
Outstanding as of January 1, 2012 | 695,430 | $ | 9.96 | $ | 6,925,500 | ||||||||||||||||||||
Granted | 1,870,614 | 7.07 | 13,064,870 | ||||||||||||||||||||||
Forfeited | (71,710 | ) | 7.49 | (537,049 | ) | ||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
Outstanding as of December 31, 2012 | 2,494,334 | 7,86 | 19,453,321 | ||||||||||||||||||||||
Forfeited | (156,505 | ) | 7.49 | (1,172,222 | ) | ||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
Outstanding as of December 31, 2013 | 2,337,829 | $ | 7.2 | $ | 18,281,099 | ||||||||||||||||||||
Option and nonvested shares vested and expect to vest as of December 31, 2013 | 2,783,106 | ||||||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
| | | | | | | | | | | |||||||||||||||
NET_INCOME_PER_SHARE_Tables
NET INCOME PER SHARE (Tables) | 12 Months Ended | ||||||||||
Dec. 31, 2013 | |||||||||||
NET INCOME PER SHARE | ' | ||||||||||
Schedule of reconciliation of the numerators and denominators of the basic and diluted net income per share computations | ' | ||||||||||
Years ended December 31, | |||||||||||
2011 | 2012 | 2013 | |||||||||
Numerator used in basic and diluted net income per common share: | |||||||||||
Net income attributable to Pactera Technology International Ltd. shareholders | $ | 17,901 | $ | 2,590 | $ | 7,837 | |||||
| | | | | | | | | | | |
| | | | | | | | | | | |
Shares (denominator): | |||||||||||
Weighted average common shares outstanding used in computing basic net income per common share | 40,596,429 | 47,547,307 | 81,942,795 | ||||||||
| | | | | | | | | | | |
| | | | | | | | | | | |
Plus incremental weighted average common shares from assumed exercise of share options and vesting of nonvested shares using treasury stock method and shares issuable in connection with business acquisition | 2,359,862 | 1,896,853 | 3,010,251 | ||||||||
| | | | | | | | | | | |
Weighted average common shares outstanding used in computing diluted net income per common share | 42,956,291 | 49,444,160 | 84,953,046 | ||||||||
| | | | | | | | | | | |
| | | | | | | | | | | |
Net income per common share attributable to shareholders of Pactera Technology International Ltd. | |||||||||||
—Basic | $ | 0.44 | $ | 0.05 | $ | 0.1 | |||||
—Diluted | $ | 0.42 | $ | 0.05 | $ | 0.09 | |||||
| | | | | | | | | | | |
| | | | | | | | | | | |
LEASES_AND_COMMITMENTS_Tables
LEASES AND COMMITMENTS (Tables) | 12 Months Ended | ||||
Dec. 31, 2013 | |||||
LEASES AND COMMITMENTS | ' | ||||
Schedule of Group's assets under capital leases | ' | ||||
Furniture, fixtures and electronic equipment | $ | 91 | |||
Less: Accumulated amortization | (91 | ) | |||
| | | | | |
$ | — | ||||
| | | | | |
Summary by years of future minimum lease payments for operating leases | ' | ||||
Years ended December 31, | |||||
2014 | $ | 11,163 | |||
2015 | 8,236 | ||||
2016 | 3,984 | ||||
2017 | 1,582 | ||||
2018 and thereafter | 1,490 | ||||
| | | | | |
Total minimum lease payments | $ | 26,455 | |||
| | | | | |
| | | | | |
SEGMENT_INFORMATION_AND_REVENU1
SEGMENT INFORMATION AND REVENUE ANALYSIS (Tables) | 12 Months Ended | |||||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||||
SEGMENT INFORMATION AND REVENUE ANALYSIS | ' | |||||||||||||||||||
Schedule of net revenues and long-lived assets by operating location | ' | |||||||||||||||||||
Years ended December 31, | ||||||||||||||||||||
2011 | 2012 | 2013 | ||||||||||||||||||
Net | Long-lived | Net | Long-lived | Net | Long-lived | |||||||||||||||
Revenues(1) | assets(2) | Revenues(1) | Assets(2) | Revenues(1) | Assets(2) | |||||||||||||||
Greater China | $ | 87,264 | $ | 37,405 | $ | 172,316 | $ | 197,559 | $ | 401,988 | $ | 219,380 | ||||||||
United States | 49,271 | 19,922 | 75,306 | 31,729 | 135,647 | 31,118 | ||||||||||||||
Asia South | 29,673 | 8,549 | 45,276 | 23,984 | 69,884 | 21,700 | ||||||||||||||
Japan | 47,671 | 1,996 | 60,137 | 2,743 | 49,623 | 2,496 | ||||||||||||||
Europe | 5,110 | — | 5,996 | 3,387 | 12,877 | 3,387 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total | $ | 218,989 | $ | 67,872 | $ | 359,031 | $ | 259,402 | $ | 670,019 | $ | 278,081 | ||||||||
| | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Note: | ||||||||||||||||||||
-1 | ||||||||||||||||||||
Net revenues are presented by operating location of the Group's customer entities. | ||||||||||||||||||||
-2 | ||||||||||||||||||||
Long-lived assets are presented by the operating location of the subsidiaries of the Company. | ||||||||||||||||||||
Schedule of net revenues by service lines | ' | |||||||||||||||||||
Years ended December 31, | ||||||||||||||||||||
2011 | 2012 | 2013 | ||||||||||||||||||
ITS | $ | 126,105 | $ | 212,448 | $ | 398,915 | ||||||||||||||
RDS | 92,884 | 144,173 | 259,606 | |||||||||||||||||
BPO | — | 2,410 | 11,498 | |||||||||||||||||
| | | | | | | | | | | ||||||||||
Total | $ | 218,989 | $ | 359,031 | $ | 670,019 | ||||||||||||||
| | | | | | | | | | | ||||||||||
| | | | | | | | | | | ||||||||||
ORGANIZATION_AND_PRINCIPAL_ACT2
ORGANIZATION AND PRINCIPAL ACTIVITIES (Details) | 1 Months Ended | 1 Months Ended | 0 Months Ended | ||||
Oct. 31, 2012 | Dec. 31, 2013 | Nov. 30, 2012 | Nov. 30, 2012 | Nov. 30, 2012 | Nov. 09, 2012 | Nov. 09, 2012 | |
Common Stock | American Depositary Share | VanceInfo | VanceInfo | ||||
VanceInfo shareholders | |||||||
ORGANIZATION AND PRINCIPAL ACTIVITIES | ' | ' | ' | ' | ' | ' | ' |
Ownership percentage in the combined company | ' | ' | ' | ' | ' | 50.00% | 50.00% |
Share exchange ratio | ' | ' | ' | 1 | 1 | ' | ' |
Number of ordinary share represented by each American Depository Share | 19 | 1 | 1 | ' | ' | ' | ' |
Common share consolidation ratio | 13.9482 | ' | ' | ' | ' | ' | ' |
ORGANIZATION_AND_PRINCIPAL_ACT3
ORGANIZATION AND PRINCIPAL ACTIVITIES (Details 2) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
ORGANIZATION AND PRINCIPAL ACTIVITIES | ' | ' | ' |
Net revenues | $670,019 | $359,031 | $218,989 |
Gain on disposal of Hisoft Dalian | 305 | ' | ' |
Hisoft Dalian | ' | ' | ' |
ORGANIZATION AND PRINCIPAL ACTIVITIES | ' | ' | ' |
Net revenues | ' | ' | ' |
Total assets | ' | 312 | 312 |
Total liability | ' | $642 | $642 |
ORGANIZATION_AND_PRINCIPAL_ACT4
ORGANIZATION AND PRINCIPAL ACTIVITIES (Details 3) | Dec. 31, 2013 |
Pactera Japan | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
DMK International | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
Pactera Dalian | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
Pactera Systems Hong Kong | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
Pactera Shenzhen Systems | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
HiSoft Beijing | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
Pactera NA | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
Pactera Chengdu | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
Pactera Singapore | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
Pactera Wuxi | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
AllianceSPEC | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
Wuxi Training Center | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
Horizon Information | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
ISL | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
Pactera Jinxin | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
NouvEON | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
HURO | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
Pactera Spain | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
Glory | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
Bearing Point | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
Pactera Shenzhen Information | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
VanceInfo | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
Pactera Beijing | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
Pactera BVI | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
Pactera US | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
Pactera Hong Kong | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
Pactera Shanghai Technology | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
VanceInfo Tianjin | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
Pactera Shanghai | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
Pactera Malaysia | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
Pactera Shenzhen | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
Pactera Nanjing | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
TP Teleservices | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
TP Hong Kong | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
TP Consultants | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
TP Taiwan | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
TP Shanghai | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
Pactera Financial Service | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
Pactera Data | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
Beijing Viatt | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
Lifewood Technology | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
Lifewood Data | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
Lifewood Dongguan | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
Pactera Australia | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
Beijing DPC | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
Beijing KPW | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
VanceInfo Singapore | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
Pactera Financial Solutions | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
Sunwin | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
Pactera Airsoft | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
VanceInfo Suzhou | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
Pactera Outstanding | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
Pactera Mauritius | ' |
Subsidiaries and variable interest entity | ' |
Percentage of legal ownership | 100.00% |
SUMMARY_OF_SIGNIFICANT_ACCOUNT4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Concentration risk | ' | ' | ' |
Net revenues | $670,019 | $359,031 | $218,989 |
Maximum | ' | ' | ' |
Concentration risk | ' | ' | ' |
Maturity period of term deposits | '1 year | ' | ' |
Net revenues | Customers | Client A | ' | ' | ' |
Concentration risk | ' | ' | ' |
Net revenues | 69,530 | 29,772 | 17,826 |
Percentage of concentration risk | 10.00% | 8.00% | 8.00% |
Net revenues | Customers | Client B | ' | ' | ' |
Concentration risk | ' | ' | ' |
Net revenues | $38,512 | $26,582 | $23,928 |
Percentage of concentration risk | 6.00% | 7.00% | 11.00% |
Accounts receivable | Credit concentration | Client C | ' | ' | ' |
Concentration risk | ' | ' | ' |
Percentage of concentration risk | 18.00% | 31.00% | ' |
SUMMARY_OF_SIGNIFICANT_ACCOUNT5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 2) | 12 Months Ended |
Dec. 31, 2013 | |
Building | ' |
Property, plant and equipment, net | ' |
Estimated useful lives | '30 years |
Furniture, fixtures and electronic equipment & software | Minimum | ' |
Property, plant and equipment, net | ' |
Estimated useful lives | '3 years |
Furniture, fixtures and electronic equipment & software | Maximum | ' |
Property, plant and equipment, net | ' |
Estimated useful lives | '5 years |
Transportation equipment | ' |
Property, plant and equipment, net | ' |
Estimated useful lives | '5 years |
SUMMARY_OF_SIGNIFICANT_ACCOUNT6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 3) | 12 Months Ended |
Dec. 31, 2013 | |
Customer base and customer relationship | Minimum | ' |
Intangible assets | ' |
Estimated economic lives or weighted-average amortization period | '3 years |
Customer base and customer relationship | Maximum | ' |
Intangible assets | ' |
Estimated economic lives or weighted-average amortization period | '6 years 9 months 18 days |
Non-compete agreement | Minimum | ' |
Intangible assets | ' |
Estimated economic lives or weighted-average amortization period | '1 year |
Non-compete agreement | Maximum | ' |
Intangible assets | ' |
Estimated economic lives or weighted-average amortization period | '5 years |
Contract backlog | Minimum | ' |
Intangible assets | ' |
Estimated economic lives or weighted-average amortization period | '6 months |
Contract backlog | Maximum | ' |
Intangible assets | ' |
Estimated economic lives or weighted-average amortization period | '2 years 1 month 20 days |
Trade name | ' |
Intangible assets | ' |
Estimated economic lives or weighted-average amortization period | '1 year |
Trademark | Minimum | ' |
Intangible assets | ' |
Estimated economic lives or weighted-average amortization period | '1 year |
Trademark | Maximum | ' |
Intangible assets | ' |
Estimated economic lives or weighted-average amortization period | '2 years |
Software Technology | Minimum | ' |
Intangible assets | ' |
Estimated economic lives or weighted-average amortization period | '4 years |
Software Technology | Maximum | ' |
Intangible assets | ' |
Estimated economic lives or weighted-average amortization period | '5 years |
SUMMARY_OF_SIGNIFICANT_ACCOUNT7
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 4) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Revenue recognition | ' | ' | ' |
Net revenues | $670,019 | $359,031 | $218,989 |
Time-and-material | ' | ' | ' |
Revenue recognition | ' | ' | ' |
Net revenues | 543,062 | 282,615 | 175,115 |
Fixed-price | ' | ' | ' |
Revenue recognition | ' | ' | ' |
Net revenues | $126,957 | $76,416 | $43,874 |
SUMMARY_OF_SIGNIFICANT_ACCOUNT8
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 5) (USD $) | 12 Months Ended | 5 Months Ended | ||||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2012 |
Ministry of Finance and the State Administration of Taxation | Ministry of Finance and the State Administration of Taxation | Ministry of Finance and the State Administration of Taxation | ||||
VAT Rate one (as a percent) | VAT Rate two (as a percent) | |||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ' | ' | ' | ' | ' | ' |
Value-added tax rate on product sales and services (as a percent) | ' | ' | ' | 17.00% | ' | ' |
Value-added tax rate, pilot program (as a percent) | ' | ' | ' | ' | 6.00% | 3.00% |
Business tax | ' | ' | ' | ' | ' | ' |
Business tax rate for subsidiaries in PRC (as a percent) | 5.00% | ' | ' | ' | ' | ' |
Government subsidies | ' | ' | ' | ' | ' | ' |
Total government subsidies included in general and administrative expenses and cost of revenues | $11,326 | $13,334 | $2,744 | ' | ' | ' |
Foreign currency translation | ' | ' | ' | ' | ' | ' |
Foreign currency exchange losses | $616 | $1,042 | $2,070 | ' | ' | ' |
ACQUISITIONS_Details
ACQUISITIONS (Details) (USD $) | 1 Months Ended | 0 Months Ended | ||||
In Thousands, unless otherwise specified | Jul. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Jan. 02, 2011 | Jan. 02, 2011 |
Beans | Beans | |||||
Customer relationship | ||||||
ACQUISITIONS | ' | ' | ' | ' | ' | ' |
Total consideration | ' | ' | ' | ' | $2,042 | ' |
Cash consideration paid | 9,004 | ' | ' | ' | 574 | ' |
Fair value of contingent consideration | ' | ' | ' | ' | 1,468 | ' |
Intangible assets acquired: | ' | ' | ' | ' | ' | ' |
Intangible assets acquired | ' | ' | ' | ' | ' | 927 |
Goodwill | ' | 102,222 | 102,659 | 37,348 | 1,115 | ' |
Total | ' | ' | ' | ' | 2,042 | ' |
Total consideration | ' | ' | ' | ' | $2,042 | ' |
Estimated useful lives | ' | ' | ' | ' | ' | ' |
Estimated useful lives | ' | ' | ' | ' | ' | '6 years |
ACQUISITIONS_Details_2
ACQUISITIONS (Details 2) (USD $) | 1 Months Ended | 1 Months Ended | 12 Months Ended | 0 Months Ended | |||||
In Thousands, except Per Share data, unless otherwise specified | Jul. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Jul. 31, 2011 | Dec. 31, 2011 | Feb. 01, 2011 | Feb. 01, 2011 | Feb. 01, 2011 |
Business team of China-based IT service firms | Business team of China-based IT service firms | Business team of China-based IT service firms | Business team of China-based IT service firms | Business team of China-based IT service firms | |||||
Contract backlog | Customer relationship | ||||||||
ACQUISITIONS | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cash consideration paid | $9,004 | ' | ' | ' | $2,500 | ' | ' | ' | ' |
Intangible assets acquired: | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Intangible assets acquired | ' | ' | ' | ' | ' | ' | ' | 287 | 666 |
Goodwill | ' | 102,222 | 102,659 | 37,348 | ' | ' | 1,547 | ' | ' |
Total consideration | ' | ' | ' | ' | ' | ' | 2,500 | ' | ' |
Estimated useful lives | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Estimated useful lives | ' | ' | ' | ' | ' | ' | ' | '10 months 24 days | '4 years 10 months 24 days |
Pro forma financial information | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net revenues | ' | ' | ' | ' | ' | 219,197 | ' | ' | ' |
Net income | ' | ' | ' | ' | ' | $17,715 | ' | ' | ' |
Net income per share | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Basic (in dollars per share) | ' | ' | ' | ' | ' | $0.44 | ' | ' | ' |
Diluted (in dollars per share) | ' | ' | ' | ' | ' | $0.41 | ' | ' | ' |
ACQUISITIONS_Details_3
ACQUISITIONS (Details 3) (USD $) | 1 Months Ended | 0 Months Ended | 12 Months Ended | 0 Months Ended | |||||
In Thousands, except Per Share data, unless otherwise specified | Jul. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Jul. 01, 2011 | Dec. 31, 2011 | Jul. 01, 2011 | Jul. 01, 2011 | Jul. 01, 2011 |
NouvEON | NouvEON | NouvEON | NouvEON | NouvEON | |||||
Trademark | Customer relationship | Backlog | |||||||
ACQUISITIONS | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Ownership interest acquired (as a percent) | ' | ' | ' | ' | 100.00% | ' | ' | ' | ' |
Purchase price | ' | ' | ' | ' | $14,160 | ' | ' | ' | ' |
Cash consideration paid | 9,004 | ' | ' | ' | ' | 6,757 | ' | ' | ' |
Fair value of contingent consideration | ' | ' | ' | ' | 7,403 | ' | ' | ' | ' |
Net liabilities assumed: | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Current assets | ' | ' | ' | ' | 830 | ' | ' | ' | ' |
Current liabilities | ' | ' | ' | ' | -1,879 | ' | ' | ' | ' |
Total | ' | ' | ' | ' | -1,049 | ' | ' | ' | ' |
Intangible assets acquired: | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Intangible assets acquired | ' | ' | ' | ' | ' | ' | 2,900 | 3,300 | 283 |
Goodwill | ' | 102,222 | 102,659 | 37,348 | 10,930 | ' | ' | ' | ' |
Deferred tax liability | ' | ' | ' | ' | -2,204 | ' | ' | ' | ' |
Total | ' | ' | ' | ' | 15,209 | ' | ' | ' | ' |
Total consideration | ' | ' | ' | ' | 14,160 | ' | ' | ' | ' |
Estimated useful lives | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Estimated useful lives | ' | ' | ' | ' | ' | ' | ' | '4 years | '1 year |
Pro forma financial information | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net revenues | ' | ' | ' | ' | ' | 225,390 | ' | ' | ' |
Net income | ' | ' | ' | ' | ' | $17,260 | ' | ' | ' |
Net income per share | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Basic (in dollars per share) | ' | ' | ' | ' | ' | $0.43 | ' | ' | ' |
Diluted (in dollars per share) | ' | ' | ' | ' | ' | $0.40 | ' | ' | ' |
ACQUISITIONS_Details_4
ACQUISITIONS (Details 4) (USD $) | 1 Months Ended | 0 Months Ended | 12 Months Ended | 24 Months Ended | 0 Months Ended | ||||||
In Thousands, except Per Share data, unless otherwise specified | Jul. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Oct. 02, 2011 | Dec. 31, 2011 | Dec. 31, 2012 | Oct. 02, 2011 | Oct. 02, 2011 | Oct. 02, 2011 | Oct. 02, 2011 |
HURO | HURO | HURO | HURO | HURO | HURO | HURO | |||||
Trade name | Customer relationship | Contract backlog | Non-compete agreement | ||||||||
ACQUISITIONS | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Ownership interest acquired (as a percent) | ' | ' | ' | ' | 100.00% | ' | ' | ' | ' | ' | ' |
Purchase price | ' | ' | ' | ' | $7,293 | ' | ' | ' | ' | ' | ' |
Cash consideration paid | 9,004 | ' | ' | ' | ' | ' | 3,282 | ' | ' | ' | ' |
Fair value of contingent consideration | ' | ' | ' | ' | 4,011 | ' | ' | ' | ' | ' | ' |
Net tangible assets: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Current assets | ' | ' | ' | ' | 4,375 | ' | ' | ' | ' | ' | ' |
Current liabilities | ' | ' | ' | ' | -3,825 | ' | ' | ' | ' | ' | ' |
Total | ' | ' | ' | ' | 550 | ' | ' | ' | ' | ' | ' |
Intangible assets acquired: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Intangible assets acquired | ' | ' | ' | ' | ' | ' | ' | 1,425 | 1,339 | 856 | 359 |
Goodwill | ' | 102,222 | 102,659 | 37,348 | 3,361 | ' | ' | ' | ' | ' | ' |
Deferred tax liability | ' | ' | ' | ' | -597 | ' | ' | ' | ' | ' | ' |
Total | ' | ' | ' | ' | 6,743 | ' | ' | ' | ' | ' | ' |
Total consideration | ' | ' | ' | ' | 7,293 | ' | ' | ' | ' | ' | ' |
Estimated useful lives | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Estimated useful lives | ' | ' | ' | ' | ' | ' | ' | ' | '5 years | '1 year | '5 years |
Pro forma financial information | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net revenues | ' | ' | ' | ' | ' | 222,856 | ' | ' | ' | ' | ' |
Net income | ' | ' | ' | ' | ' | $17,514 | ' | ' | ' | ' | ' |
Net income per share | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Basic (in dollars per share) | ' | ' | ' | ' | ' | $0.43 | ' | ' | ' | ' | ' |
Diluted (in dollars per share) | ' | ' | ' | ' | ' | $0.41 | ' | ' | ' | ' | ' |
ACQUISITIONS_Details_5
ACQUISITIONS (Details 5) (USD $) | 1 Months Ended | 1 Months Ended | 12 Months Ended | 1 Months Ended | ||||
In Thousands, except Per Share data, unless otherwise specified | Jul. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Feb. 29, 2012 | Dec. 31, 2012 | Dec. 31, 2011 | Feb. 29, 2012 |
Logoscript | Logoscript | Logoscript | Logoscript | |||||
Customer relationship | ||||||||
ACQUISITIONS | ' | ' | ' | ' | ' | ' | ' | ' |
Ownership interest acquired (as a percent) | ' | ' | ' | ' | 100.00% | ' | ' | ' |
Purchase price | ' | ' | ' | ' | $1,399 | ' | ' | ' |
Cash consideration paid | 9,004 | ' | ' | ' | ' | 1,158 | ' | ' |
Fair value of cash consideration | ' | ' | ' | ' | 241 | ' | ' | ' |
Net tangible assets: | ' | ' | ' | ' | ' | ' | ' | ' |
Assets | ' | ' | ' | ' | 1,592 | ' | ' | ' |
Liabilities | ' | ' | ' | ' | -1,150 | ' | ' | ' |
Total | ' | ' | ' | ' | 442 | ' | ' | ' |
Intangible assets acquired: | ' | ' | ' | ' | ' | ' | ' | ' |
Intangible assets acquired | ' | ' | ' | ' | ' | ' | ' | 233 |
Goodwill | ' | 102,222 | 102,659 | 37,348 | 794 | ' | ' | ' |
Deferred tax liability | ' | ' | ' | ' | -70 | ' | ' | ' |
Total | ' | ' | ' | ' | 957 | ' | ' | ' |
Total consideration | ' | ' | ' | ' | 1,399 | ' | ' | ' |
Estimated useful lives | ' | ' | ' | ' | ' | ' | ' | ' |
Estimated useful lives | ' | ' | ' | ' | ' | ' | ' | '3 years |
Pro forma information summarizing the results of operations | ' | ' | ' | ' | ' | ' | ' | ' |
Net revenues | ' | ' | ' | ' | ' | 359,352 | 222,836 | ' |
Net income | ' | ' | ' | ' | ' | $2,553 | $17,458 | ' |
Net income per share | ' | ' | ' | ' | ' | ' | ' | ' |
Basic (in dollars per share) | ' | ' | ' | ' | ' | $0.05 | $0.43 | ' |
Diluted (in dollars per share) | ' | ' | ' | ' | ' | $0.05 | $0.41 | ' |
ACQUISITIONS_Details_6
ACQUISITIONS (Details 6) (USD $) | 1 Months Ended | 1 Months Ended | 12 Months Ended | 1 Months Ended | |||||||
In Thousands, except Per Share data, unless otherwise specified | Jul. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | 31-May-12 | Mar. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2011 | Mar. 31, 2012 | Mar. 31, 2012 | Mar. 31, 2012 |
Longhaul | Longhaul | Longhaul | Longhaul | Longhaul | Longhaul | Longhaul | |||||
Customer relationship | Contract backlog | Non-compete agreement | |||||||||
ACQUISITIONS | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Purchase price | ' | ' | ' | ' | ' | $1,494 | ' | ' | ' | ' | ' |
Cash consideration paid | 9,004 | ' | ' | ' | 772 | ' | ' | ' | ' | ' | ' |
Fair value of cash consideration | ' | ' | ' | ' | ' | 722 | ' | ' | ' | ' | ' |
Intangible assets acquired: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Intangible assets acquired | ' | ' | ' | ' | ' | ' | ' | ' | 190 | 27 | 262 |
Goodwill | ' | 102,222 | 102,659 | 37,348 | ' | 1,015 | ' | ' | ' | ' | ' |
Total | ' | ' | ' | ' | ' | 1,494 | ' | ' | ' | ' | ' |
Total consideration | ' | ' | ' | ' | ' | 1,494 | ' | ' | ' | ' | ' |
Estimated useful lives of intangible assets | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Estimated useful lives | ' | ' | ' | ' | ' | ' | ' | ' | '3 years 6 months | '3 months | '4 years |
Pro forma information summarizing the results of operations | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net revenues | ' | ' | ' | ' | ' | ' | 359,322 | 220,733 | ' | ' | ' |
Net income | ' | ' | ' | ' | ' | ' | $2,583 | $17,858 | ' | ' | ' |
Net income per share | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Basic (in dollars per share) | ' | ' | ' | ' | ' | ' | $0.05 | $0.44 | ' | ' | ' |
Diluted (in dollars per share) | ' | ' | ' | ' | ' | ' | $0.05 | $0.42 | ' | ' | ' |
ACQUISITIONS_Details_7
ACQUISITIONS (Details 7) (USD $) | 1 Months Ended | 1 Months Ended | 12 Months Ended | 1 Months Ended | |||||||
In Thousands, except Per Share data, unless otherwise specified | Jul. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Jun. 30, 2012 | Dec. 31, 2012 | Dec. 31, 2011 | Jun. 30, 2012 | Jun. 30, 2012 | Jun. 30, 2012 | Jun. 30, 2012 |
Glory | Glory | Glory | Glory | Glory | Glory | Glory | |||||
Trade name | Customer relationship | Contract backlog | Non-compete agreement | ||||||||
ACQUISITIONS | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Ownership interest acquired (as a percent) | ' | ' | ' | ' | 100.00% | ' | ' | ' | ' | ' | ' |
Purchase price | ' | ' | ' | ' | $6,616 | ' | ' | ' | ' | ' | ' |
Cash consideration paid | 9,004 | ' | ' | ' | ' | 3,061 | ' | ' | ' | ' | ' |
Fair value of cash consideration | ' | ' | ' | ' | 3,555 | ' | ' | ' | ' | ' | ' |
Net tangible assets: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Current assets | ' | ' | ' | ' | 1,465 | ' | ' | ' | ' | ' | ' |
Current liabilities | ' | ' | ' | ' | -1,879 | ' | ' | ' | ' | ' | ' |
Total | ' | ' | ' | ' | -414 | ' | ' | ' | ' | ' | ' |
Intangible assets acquired: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Intangible assets acquired | ' | ' | ' | ' | ' | ' | ' | 2,149 | 959 | 530 | 225 |
Goodwill | ' | 102,222 | 102,659 | 37,348 | 3,746 | ' | ' | ' | ' | ' | ' |
Deferred tax liability | ' | ' | ' | ' | -579 | ' | ' | ' | ' | ' | ' |
Total | ' | ' | ' | ' | 7,030 | ' | ' | ' | ' | ' | ' |
Total consideration | ' | ' | ' | ' | 6,616 | ' | ' | ' | ' | ' | ' |
Estimated useful lives of intangible assets | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Estimated useful lives | ' | ' | ' | ' | ' | ' | ' | ' | '5 years | '1 year | '5 years |
Pro forma information summarizing the results of operations | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net revenues | ' | ' | ' | ' | ' | 360,796 | 223,225 | ' | ' | ' | ' |
Net income | ' | ' | ' | ' | ' | $2,652 | $18,050 | ' | ' | ' | ' |
Net income per share | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Basic (in dollars per share) | ' | ' | ' | ' | ' | $0.06 | $0.44 | ' | ' | ' | ' |
Diluted (in dollars per share) | ' | ' | ' | ' | ' | $0.05 | $0.42 | ' | ' | ' | ' |
ACQUISITIONS_Details_8
ACQUISITIONS (Details 8) (USD $) | 1 Months Ended | 1 Months Ended | 12 Months Ended | 0 Months Ended | ||||||
In Thousands, except Per Share data, unless otherwise specified | Jul. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Aug. 31, 2012 | Jul. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2011 | Jul. 31, 2012 | Jul. 31, 2012 |
Bearing Point | Bearing Point | Bearing Point | Bearing Point | Bearing Point | Bearing Point | |||||
Customer relationship | Trade name | |||||||||
ACQUISITIONS | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Ownership interest acquired (as a percent) | ' | ' | ' | ' | ' | 100.00% | ' | ' | ' | ' |
Purchase price | ' | ' | ' | ' | ' | $7,465 | ' | ' | ' | ' |
Cash consideration paid | 9,004 | ' | ' | ' | ' | 3,601 | ' | ' | ' | ' |
Fair value of cash consideration | ' | ' | ' | ' | ' | 3,864 | ' | ' | ' | ' |
Amount of deferred compensation paid and expensed | ' | ' | ' | ' | 1,025 | ' | ' | ' | ' | ' |
Service period | ' | ' | ' | ' | ' | 'P3Y | ' | ' | ' | ' |
Net tangible assets: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Assets | ' | ' | ' | ' | ' | 6,729 | ' | ' | ' | ' |
Liabilities | ' | ' | ' | ' | ' | -5,180 | ' | ' | ' | ' |
Total | ' | ' | ' | ' | ' | 1,549 | ' | ' | ' | ' |
Intangible assets acquired: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Intangible assets acquired | ' | ' | ' | ' | ' | ' | ' | ' | 1,845 | 512 |
Goodwill | ' | 102,222 | 102,659 | 37,348 | ' | 4,266 | ' | ' | ' | ' |
Deferred tax liability | ' | ' | ' | ' | ' | -707 | ' | ' | ' | ' |
Total | ' | ' | ' | ' | ' | 5,916 | ' | ' | ' | ' |
Total consideration | ' | ' | ' | ' | ' | 7,465 | ' | ' | ' | ' |
Estimated useful lives | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Estimated useful lives | ' | ' | ' | ' | ' | ' | ' | ' | '5 years | '2 years |
Pro forma financial information | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net revenues | ' | ' | ' | ' | ' | ' | 368,538 | 238,002 | ' | ' |
Net income | ' | ' | ' | ' | ' | ' | $2,484 | $17,690 | ' | ' |
Net income per share | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Basic (in dollars per share) | ' | ' | ' | ' | ' | ' | $0.05 | $0.44 | ' | ' |
Diluted (in dollars per share) | ' | ' | ' | ' | ' | ' | $0.05 | $0.41 | ' | ' |
ACQUISITIONS_Details_9
ACQUISITIONS (Details 9) (USD $) | 1 Months Ended | 1 Months Ended | 12 Months Ended | 0 Months Ended | ||||||
In Thousands, except Per Share data, unless otherwise specified | Jul. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Aug. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2011 | Aug. 31, 2012 | Aug. 31, 2012 | Aug. 31, 2012 |
Newton | Newton | Newton | Newton | Newton | Newton | |||||
Acquired software | Contract backlog | Customer relationship | ||||||||
ACQUISITIONS | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Ownership interest acquired (as a percent) | ' | ' | ' | ' | 100.00% | ' | ' | ' | ' | ' |
Purchase price | ' | ' | ' | ' | $1,464 | ' | ' | ' | ' | ' |
Cash consideration paid | 9,004 | ' | ' | ' | 1,241 | ' | ' | ' | ' | ' |
Fair value of cash consideration | ' | ' | ' | ' | 223 | ' | ' | ' | ' | ' |
Net tangible assets: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Assets | ' | ' | ' | ' | 936 | ' | ' | ' | ' | ' |
Liabilities | ' | ' | ' | ' | -465 | ' | ' | ' | ' | ' |
Total | ' | ' | ' | ' | 471 | ' | ' | ' | ' | ' |
Intangible assets acquired: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Intangible assets acquired | ' | ' | ' | ' | ' | ' | ' | 168 | 3 | 434 |
Goodwill | ' | 102,222 | 102,659 | 37,348 | 557 | ' | ' | ' | ' | ' |
Deferred tax liability | ' | ' | ' | ' | -169 | ' | ' | ' | ' | ' |
Total | ' | ' | ' | ' | 993 | ' | ' | ' | ' | ' |
Total consideration | ' | ' | ' | ' | 1,464 | ' | ' | ' | ' | ' |
Estimated useful lives | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Estimated economic lives | ' | ' | ' | ' | ' | ' | ' | '5 years | '6 months | '5 years |
Pro forma financial information | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net revenues | ' | ' | ' | ' | ' | 360,319 | 221,197 | ' | ' | ' |
Net income | ' | ' | ' | ' | ' | $2,313 | $17,425 | ' | ' | ' |
Net income per share | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Basic (in dollars per share) | ' | ' | ' | ' | ' | $0.05 | $0.43 | ' | ' | ' |
Diluted (in dollars per share) | ' | ' | ' | ' | ' | $0.05 | $0.41 | ' | ' | ' |
ACQUISITIONS_Details_10
ACQUISITIONS (Details 10) (USD $) | 1 Months Ended | 12 Months Ended | 1 Months Ended | 12 Months Ended | 0 Months Ended | 1 Months Ended | |||
In Thousands, unless otherwise specified | Jul. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Oct. 01, 2012 | Dec. 31, 2010 | Dec. 31, 2010 | Oct. 03, 2012 | Dec. 31, 2010 |
Pactera Jinxin | Pactera Jinxin | Pactera Jinxin | Pactera Jinxin | Pactera Jinxin | Pactera Jinxin | Pactera Jinxin | Pactera Jinxin | ||
Contingent Consideration Payable Based on Financial Performance of 2013 | HiSoft Beijing | HiSoft Beijing | HiSoft Beijing | Third party individuals | Third party individuals | HiSoft Beijing | HiSoft Beijing | ||
item | |||||||||
Subsidiaries and variable interest entity | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of third party individuals | ' | ' | ' | ' | ' | ' | 5 | ' | ' |
Ownership interest acquired (as a percent) | ' | ' | ' | ' | 40.00% | 40.00% | 40.00% | ' | 60.00% |
Capital injected to incorporate new entity | ' | ' | ' | ' | ' | $909 | ' | ' | $1,364 |
Total consideration | ' | ' | ' | ' | ' | ' | ' | 12,938 | ' |
Cash consideration paid | 9,004 | ' | 9,278 | 1,203 | ' | ' | ' | ' | ' |
Potential consideration payable | ' | $2,457 | ' | ' | ' | ' | ' | ' | ' |
ACQUISITIONS_Details_11
ACQUISITIONS (Details 11) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Nov. 09, 2012 | Dec. 31, 2012 | Dec. 31, 2011 | Nov. 09, 2012 | Nov. 09, 2012 | Nov. 09, 2012 | Nov. 09, 2012 | Nov. 09, 2012 | Nov. 09, 2012 | Nov. 09, 2012 | Nov. 09, 2012 | Nov. 09, 2012 | Nov. 09, 2012 | Nov. 09, 2012 | Nov. 09, 2012 | Nov. 09, 2012 | Nov. 09, 2012 |
In Thousands, except Per Share data, unless otherwise specified | VanceInfo | VanceInfo | VanceInfo | VanceInfo | VanceInfo | VanceInfo | VanceInfo | VanceInfo | VanceInfo | VanceInfo | VanceInfo | VanceInfo | VanceInfo | VanceInfo | VanceInfo | VanceInfo | VanceInfo | |||
Customer relationship | Customer relationship | Customer relationship | Trade name | Software technology | Software technology | Software technology | Contract backlog | Non-compete agreement | Non-compete agreement | Non-compete agreement | Shares issued in exchange for shares of VanceInfo | Shares issued in exchange for fair value of vested VanceInfo stock options and RSU | VanceInfo shareholders | |||||||
Minimum | Maximum | Minimum | Maximum | Minimum | Maximum | |||||||||||||||
ACQUISITIONS | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Ownership percentage in the combined company | ' | ' | ' | 50.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 50.00% |
Total consideration | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Issuance of common shares | ' | ' | ' | 42,517 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Closing price on transaction date (in dollars per share) | ' | ' | ' | $7.49 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Stock consideration | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $318,451 | $8,327 | ' |
Total consideration | ' | ' | ' | 326,778 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net tangible assets: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Assets | ' | ' | ' | 319,072 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Liabilities | ' | ' | ' | -81,715 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total | ' | ' | ' | 237,357 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Intangible assets acquired: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Intangible assets acquired | ' | ' | ' | ' | ' | ' | 11,540 | ' | ' | 27,840 | 2,290 | ' | ' | 910 | 1,400 | ' | ' | ' | ' | ' |
Goodwill | 102,222 | 102,659 | 37,348 | 54,407 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Deferred tax liability | ' | ' | ' | -8,966 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total | ' | ' | ' | 89,421 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total consideration | ' | ' | ' | 326,778 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Estimated useful life | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Estimated economic lives | ' | ' | ' | ' | ' | ' | ' | '4 years | '6 years | '2 years | ' | '4 years | '5 years | '2 years | ' | '1 year | '4 years | ' | ' | ' |
Pro forma financial information | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net revenues | ' | ' | ' | ' | 673,266 | 502,126 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net income/(loss) | ' | ' | ' | ' | $1,807 | $39,532 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net income/(loss) per share (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Basic (in dollars per share) | ' | ' | ' | ' | $0.02 | $0.47 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Diluted (in dollars per share) | ' | ' | ' | ' | $0.02 | $0.45 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
ACQUISITIONS_Details_12
ACQUISITIONS (Details 12) (USD $) | 1 Months Ended | 0 Months Ended | 12 Months Ended | |
In Thousands, except Share data, unless otherwise specified | Jul. 31, 2013 | Jan. 02, 2013 | Dec. 31, 2013 | Dec. 31, 2013 |
Pactera Financial Solutions | Pactera Financial Solutions | Pactera Financial Solutions | ||
Nonvested shares | ||||
ACQUISITIONS | ' | ' | ' | ' |
Nonvested shares granted to key employees (as a percent) | ' | ' | ' | 33.30% |
Nonvested shares granted to key employees | ' | ' | ' | 1,000,000 |
Ownership interest acquired (as a percent) | ' | 33.30% | ' | ' |
Total consideration | ' | $6,294 | ' | ' |
Cash consideration paid | 9,004 | 2,773 | ' | ' |
Consideration paid through vested nonvested shares | ' | 227 | ' | ' |
Potential consideration payable | ' | ' | $3,294 | ' |
ACQUISITIONS_Details_13
ACQUISITIONS (Details 13) (USD $) | 1 Months Ended | 0 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended | 0 Months Ended | |
In Thousands, unless otherwise specified | Jul. 31, 2013 | Apr. 01, 2011 | Dec. 31, 2011 | Apr. 01, 2011 | Dec. 31, 2012 | Jun. 01, 2011 | Jun. 01, 2011 |
iConnect Business | iConnect Business | Shanghai Yuetong Business | Shanghai Yuetong Business | Ascent Business | Ascent Business | ||
Contingent consideration payable based on financial performance from July 2013 to June 2014 | |||||||
ACQUISITIONS | ' | ' | ' | ' | ' | ' | ' |
Cash consideration paid | $9,004 | $400 | ' | $600 | ' | $245 | ' |
Potential consideration payable | ' | ' | ' | ' | ' | ' | 227 |
Contingent consideration paid | ' | ' | $306 | ' | $459 | ' | ' |
RESTRICTED_CASH_Details
RESTRICTED CASH (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
RESTRICTED CASH | ' | ' |
Balance of restricted cash | $1,067 | $6,112 |
Deposit of forward foreign currency exchange transactions | ' | ' |
RESTRICTED CASH | ' | ' |
Balance of restricted cash | 94 | 808 |
Deposit of Letter of Guarantee for a project | ' | ' |
RESTRICTED CASH | ' | ' |
Balance of restricted cash | 657 | 648 |
Bank letter of guarantee for facility rentals in Singapore and Spain | ' | ' |
RESTRICTED CASH | ' | ' |
Balance of restricted cash | 203 | 210 |
Deposits of bank bills | ' | ' |
RESTRICTED CASH | ' | ' |
Balance of restricted cash | 83 | 2,812 |
Pledged deposit for short-term bank loan | ' | ' |
RESTRICTED CASH | ' | ' |
Balance of restricted cash | 0 | 1,605 |
Deposits to secure commercial card issued by bank | ' | ' |
RESTRICTED CASH | ' | ' |
Balance of restricted cash | $30 | $29 |
SHORTTERM_INVESTMENT_Details
SHORT-TERM INVESTMENT (Details) (USD $) | Dec. 31, 2012 |
In Thousands, unless otherwise specified | |
SHORT-TERM INVESTMENT | ' |
Held-to-maturity securities carried at amortized cost | $1,765 |
ACCOUNTS_RECEIVABLE_Details
ACCOUNTS RECEIVABLE (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
ACCOUNTS RECEIVABLE | ' | ' | ' |
Billed receivable | $98,421 | $106,882 | ' |
Unbilled receivable | 161,675 | 140,197 | ' |
Accounts receivable, gross | 260,096 | 247,079 | ' |
Less: Allowance for doubtful accounts | 13,646 | 16,386 | 4,002 |
Accounts receivable, net | 246,450 | 230,693 | ' |
Activities in the allowance for doubtful accounts | ' | ' | ' |
Balance at the beginning of the year | 16,386 | 4,002 | 3,698 |
Balance brought forward from VanceInfo | ' | 10,197 | ' |
Allowance for doubtful accounts | 343 | 5,153 | 477 |
Write off | -2,978 | -2,751 | -388 |
Foreign currency translation adjustments | -105 | -215 | 215 |
Balance at the end of the year | $13,646 | $16,386 | $4,002 |
PREPAID_EXPENSES_AND_OTHER_CUR2
PREPAID EXPENSES AND OTHER CURRENT ASSETS (Details) (USD $) | 1 Months Ended | 12 Months Ended | |
In Thousands, unless otherwise specified | Jul. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 |
PREPAID EXPENSES AND OTHER CURRENT ASSETS | ' | ' | ' |
Prepaid rent and other prepaid expenses | ' | $8,467 | $11,258 |
Advances to suppliers | ' | 2,449 | 2,969 |
Deposits | ' | 1,213 | 2,031 |
Accrued interests receivable | ' | 793 | 717 |
Advances to employees | ' | 1,055 | 680 |
Prepayment for building and property | ' | 13,283 | ' |
Other current assets | ' | 1,235 | 1,007 |
Total | ' | 28,495 | 18,662 |
Prepayment for building and property balances as a percentage of the total purchase consideration | ' | 60.00% | ' |
Consideration paid | $9,004 | ' | ' |
ASSETS_HELD_FOR_SALE_Details
ASSETS HELD FOR SALE (Details) (USD $) | 12 Months Ended | 0 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 27, 2013 | Dec. 27, 2013 |
Huawei | |||
Assets Held For Sale | ' | ' | ' |
Period for which the entity will not provide similar services | ' | ' | '2 years |
Net carrying values of property, plant and equipment to be sold | ' | $2,855 | ' |
Assets held for sale | 2,589 | ' | ' |
Loss from impairment of assets held for sale | $266 | ' | ' |
PROPERTY_PLANT_AND_EQUIPMENT_N2
PROPERTY, PLANT AND EQUIPMENT, NET (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
PROPERTY, PLANT AND EQUIPMENT, NET | ' | ' | ' |
Property, plant and equipment, gross | $139,872 | $111,878 | ' |
Less: Accumulated depreciation | 44,041 | 44,271 | ' |
Property, plant and equipment, net | 95,831 | 67,607 | ' |
Depreciation expenses | 13,670 | 6,850 | 4,400 |
Construction in progress | ' | ' | ' |
PROPERTY, PLANT AND EQUIPMENT, NET | ' | ' | ' |
Property, plant and equipment, gross | ' | 36,797 | ' |
Building | ' | ' | ' |
PROPERTY, PLANT AND EQUIPMENT, NET | ' | ' | ' |
Property, plant and equipment, gross | 76,458 | ' | ' |
Furniture, fixtures, electronic equipment and software | ' | ' | ' |
PROPERTY, PLANT AND EQUIPMENT, NET | ' | ' | ' |
Property, plant and equipment, gross | 45,320 | 47,591 | ' |
Transportation equipment | ' | ' | ' |
PROPERTY, PLANT AND EQUIPMENT, NET | ' | ' | ' |
Property, plant and equipment, gross | 2,245 | 2,281 | ' |
Leasehold improvements | ' | ' | ' |
PROPERTY, PLANT AND EQUIPMENT, NET | ' | ' | ' |
Property, plant and equipment, gross | $15,849 | $25,209 | ' |
GOODWILL_Details
GOODWILL (Details) (USD $) | 2 Months Ended | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
item | item | |||
Changes in carrying amount of goodwill | ' | ' | ' | ' |
Balance at the beginning of the period | ' | $102,659 | $37,348 | ' |
Goodwill acquired in business acquisitions | ' | ' | 64,785 | ' |
Foreign currency translation adjustments | ' | -437 | 526 | ' |
Balance at the end of the period | 102,659 | 102,222 | 102,659 | 37,348 |
Number of reporting units | 2 | 1 | ' | ' |
Impairment charges related to goodwill | ' | $0 | $0 | $0 |
INTANGIBLE_ASSETS_Details
INTANGIBLE ASSETS (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
INTANGIBLE ASSETS | ' | ' | ' |
Balance at the beginning of the period | $55,303 | $15,198 | ' |
Acquisition | ' | 51,518 | ' |
Amortization | -10,434 | -6,058 | -2,677 |
Impairment | ' | -5,515 | ' |
Foreign currency translation adjustments | -257 | 160 | ' |
Balance at the end of the period | 44,612 | 55,303 | 15,198 |
Gross carrying amount | 64,503 | 64,503 | ' |
Accumulated amortization | 19,891 | 9,200 | ' |
Expected amortization expenses | ' | ' | ' |
2014 | 8,666 | ' | ' |
2015 | 6,824 | ' | ' |
2016 | 5,414 | ' | ' |
2017 | 3,837 | ' | ' |
2018 and thereafter | 4,028 | ' | ' |
Contract backlog | ' | ' | ' |
INTANGIBLE ASSETS | ' | ' | ' |
Balance at the beginning of the period | 652 | 790 | ' |
Acquisition | ' | 1,470 | ' |
Amortization | -572 | -1,611 | ' |
Foreign currency translation adjustments | 1 | 3 | ' |
Balance at the end of the period | 81 | 652 | ' |
Gross carrying amount | 3,143 | 3,143 | ' |
Accumulated amortization | 3,062 | 2,491 | ' |
Customer base and customer relationship | ' | ' | ' |
INTANGIBLE ASSETS | ' | ' | ' |
Balance at the beginning of the period | 20,818 | 8,964 | ' |
Acquisition | ' | 15,200 | ' |
Amortization | -5,420 | -3,400 | ' |
Foreign currency translation adjustments | -279 | 54 | ' |
Balance at the end of the period | 15,119 | 20,818 | ' |
Gross carrying amount | 26,390 | 26,390 | ' |
Accumulated amortization | 11,271 | 5,572 | ' |
Trade name | ' | ' | ' |
INTANGIBLE ASSETS | ' | ' | ' |
Balance at the beginning of the period | 28,882 | 2,073 | ' |
Acquisition | ' | 29,989 | ' |
Amortization | -2,590 | -428 | ' |
Impairment | ' | -2,836 | ' |
Foreign currency translation adjustments | 22 | 84 | ' |
Balance at the end of the period | 26,314 | 28,882 | ' |
Gross carrying amount | 29,388 | 29,388 | ' |
Accumulated amortization | 3,074 | 506 | ' |
Trademark | ' | ' | ' |
INTANGIBLE ASSETS | ' | ' | ' |
Balance at the beginning of the period | 712 | 3,026 | ' |
Acquisition | ' | 513 | ' |
Amortization | -694 | -157 | ' |
Impairment | ' | -2,679 | ' |
Foreign currency translation adjustments | -18 | 9 | ' |
Balance at the end of the period | ' | 712 | ' |
Gross carrying amount | 877 | 877 | ' |
Accumulated amortization | 877 | 165 | ' |
Non-compete agreement | ' | ' | ' |
INTANGIBLE ASSETS | ' | ' | ' |
Balance at the beginning of the period | 2,017 | 345 | ' |
Acquisition | ' | 1,887 | ' |
Amortization | -682 | -225 | ' |
Foreign currency translation adjustments | 17 | 10 | ' |
Balance at the end of the period | 1,352 | 2,017 | ' |
Gross carrying amount | 2,246 | 2,246 | ' |
Accumulated amortization | 894 | 229 | ' |
Software technology | ' | ' | ' |
INTANGIBLE ASSETS | ' | ' | ' |
Balance at the beginning of the period | 2,222 | ' | ' |
Acquisition | ' | 2,459 | ' |
Amortization | -476 | -237 | ' |
Balance at the end of the period | 1,746 | 2,222 | ' |
Gross carrying amount | 2,459 | 2,459 | ' |
Accumulated amortization | 713 | 237 | ' |
Trademarks and trade names | VanceInfo | ' | ' | ' |
INTANGIBLE ASSETS | ' | ' | ' |
Impairment | ' | ($5,515) | ' |
LONGTERM_INVESTMENT_Details
LONG-TERM INVESTMENT (Details) (USD $) | 12 Months Ended | |||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Feb. 29, 2012 | Feb. 29, 2012 |
Sunwin | Beijing Yunxiang Weiye Information Technology Co., Ltd | |||
VanceInfo | Sunwin | |||
Equity method investment | ' | ' | ' | ' |
Equity interest owned (as a percent) | ' | ' | 100.00% | 50.00% |
Earnings generated from the equity method investment | $68 | $23 | ' | ' |
LAND_USE_RIGHT_Details
LAND USE RIGHT (Details) (Land use rights, VanceInfo, USD $) | 0 Months Ended | 12 Months Ended | ||
In Thousands, unless otherwise specified | Nov. 09, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Land use rights | VanceInfo | ' | ' | ' | ' |
LAND USE RIGHT | ' | ' | ' | ' |
Fair value at acquisition date | $24,393 | ' | ' | ' |
Remaining useful life | '49 years | ' | ' | ' |
Amortization expense | ' | $509 | $71 | $0 |
ACCRUED_EXPENSES_AND_OTHER_PAY2
ACCRUED EXPENSES AND OTHER PAYABLES (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
ACCRUED EXPENSES AND OTHER PAYABLES | ' | ' |
Employee payroll and welfare payables | $56,008 | $47,697 |
Accrued other operating expenses | 12,501 | 6,074 |
Other employee welfare payables | 9,307 | 9,148 |
Subcontractors fees | 8,525 | 7,507 |
Advance from customers | 5,546 | 7,662 |
Accrued privatization related cost | 5,514 | ' |
Amounts payable for the construction of building | 5,120 | ' |
Accrued merger related cost | 3,886 | 12,290 |
Advance from transfer of certain outsourcing business (Note 23) | 3,764 | ' |
Accrued professional fees | 2,345 | 2,136 |
Accrued travel expenses | 1,192 | 2,262 |
Accrued rental expenses | 949 | 2,815 |
Government grant payable | 796 | 42 |
Deferred revenue | 385 | 632 |
Amount due to a related party | ' | 136 |
Other payable | 5,920 | 4,643 |
Total | $121,758 | $103,044 |
FAIR_VALUE_Details
FAIR VALUE (Details) (Recurring basis, Level 2 inputs, Foreign currency forward contracts, USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Recurring basis | Level 2 inputs | Foreign currency forward contracts | ' | ' |
FAIR VALUE. | ' | ' |
Fair value of foreign currency forward contracts recorded in prepaid expenses and other current assets | $14 | $8 |
FAIR_VALUE_Details_2
FAIR VALUE (Details 2) (Foreign currency forward contracts, U.S. dollar, USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Foreign currency forward contracts | U.S. dollar | ' | ' |
Fair Value | ' | ' |
Notional contract amount | $1,800 | $1,800 |
FAIR_VALUE_Details_3
FAIR VALUE (Details 3) (Recurring basis, Contingent consideration, USD $) | 12 Months Ended |
In Thousands, unless otherwise specified | Dec. 31, 2013 |
Fair value measurement of contingent consideration | ' |
Estimated contingent consideration payments, low end of range | 32 |
Estimated contingent consideration payments, high end of range | 4,045 |
Minimum | ' |
Fair value measurement of contingent consideration | ' |
Discount rate (as a percentage) | 1.55% |
Timing of cash flows | '2 months 1 day |
Maximum | ' |
Fair value measurement of contingent consideration | ' |
Discount rate (as a percentage) | 11.70% |
Timing of cash flows | '2 years 2 months 1 day |
FAIR_VALUE_Details_4
FAIR VALUE (Details 4) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Including | ' | ' |
Current portion of contingent consideration | $23,456 | $31,519 |
Non-current portion of contingent consideration | 4,039 | 19,900 |
Contingent consideration | ' | ' |
Movement in contingent consideration | ' | ' |
Balance at the beginning of the period | 51,419 | 18,552 |
Assumed from the merger with VanceInfo | ' | 16,775 |
Increase in contingent consideration as a result of business acquisitions | 3,294 | 20,355 |
Less: Payments made during the period | -22,661 | -3,047 |
Shares issuable in connection with business acquisition | ' | -918 |
Settlement by issuance of common shares | -3,203 | ' |
Add: Changes in fair values | -1,164 | -659 |
Foreign currency translation adjustments | -190 | 361 |
Balance at the end of the period | 27,495 | 51,419 |
Including | ' | ' |
Current portion of contingent consideration | 23,456 | ' |
Non-current portion of contingent consideration | $4,039 | ' |
FAIR_VALUE_Details_5
FAIR VALUE (Details 5) (Recurring basis, USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Total | ' | ' |
Assets and liabilities measured at fair value on a nonrecurring basis | ' | ' |
Contingent consideration | ($27,495) | ($51,419) |
Foreign currency forward contracts | 14 | 8 |
Total | -27,481 | -51,411 |
Other Observable Inputs (Level 2) | ' | ' |
Assets and liabilities measured at fair value on a nonrecurring basis | ' | ' |
Foreign currency forward contracts | 14 | 8 |
Total | 14 | 8 |
Significant Unobservable Inputs (Level 3) | ' | ' |
Assets and liabilities measured at fair value on a nonrecurring basis | ' | ' |
Contingent consideration | -27,495 | -51,419 |
Total | ($27,495) | ($51,419) |
FAIR_VALUE_Details_6
FAIR VALUE (Details 6) (USD $) | 12 Months Ended | ||||
In Thousands, unless otherwise specified | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 |
Nonrecurring basis | Nonrecurring basis | Nonrecurring basis | Tradenames and trademarks | ||
Intangible assets | Intangible assets | Intangible assets | VanceInfo | ||
Minimum | Maximum | ||||
Fair value measurements of the intangible assets | ' | ' | ' | ' | ' |
Impairment loss | $5,515 | ' | ' | ' | $5,515 |
Estimated net revenues | ' | ' | $1,400 | $30,316 | ' |
Royalty savings (as a percent) | ' | ' | 2.00% | 4.00% | ' |
Discount rate (as a percentage) | ' | 16.00% | ' | ' | ' |
Timing of cash flows | ' | ' | '1 year | '2 years | ' |
INCOME_TAXES_Details
INCOME TAXES (Details) (USD $) | 12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2009 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | Dec. 31, 2009 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 |
PRC and Hong Kong | PRC and Hong Kong | PRC and Hong Kong | Hong Kong | Hong Kong | Hong Kong | Hong Kong | Hong Kong | Hong Kong | Hong Kong | Hong Kong | Hong Kong | Hong Kong | Hong Kong | Hong Kong | Hong Kong | Hong Kong | Hong Kong | Hong Kong | Hong Kong | Hong Kong | Hong Kong | Hong Kong | Hong Kong | Hong Kong | Hong Kong | Hong Kong | Hong Kong | Hong Kong | Hong Kong | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | PRC | Japan | Japan | Japan | Japan | Japan | U.S | U.S | U.S | U.S | U.S | U.S | U.S | U.S | U.S | Singapore | Singapore | Singapore | Singapore | Singapore | Singapore | Spain | Australia | Australia | Australia | Australia | Europe | Europe | Malaysia | Mauritius | ||||
Pactera Systems Hong Kong | Pactera Systems Hong Kong | Pactera Systems Hong Kong | Pactera Hong Kong | Pactera Hong Kong | Pactera Hong Kong | TP Teleservices | TP Teleservices | TP Teleservices | TP Hong Kong | TP Hong Kong | TP Hong Kong | TP Consultants | TP Consultants | TP Consultants | TP Taiwan | TP Taiwan | TP Taiwan | Pactera Financial Service | Pactera Financial Service | Pactera Financial Service | Lifewood Technology | Lifewood Technology | Lifewood Technology | Lifewood Data | Lifewood Data | Lifewood Data | The new HNTE | Pactera Dalian | Pactera Dalian | Pactera Dalian | Pactera Dalian | Pactera Shenzhen Systems | Pactera Shenzhen Systems | Pactera Shenzhen Systems | Pactera Shenzhen Systems | Pactera Chengdu | Pactera Chengdu | Pactera Chengdu | HiSoft Beijing | HiSoft Beijing | HiSoft Beijing | Pactera Wuxi | Pactera Wuxi | Pactera Wuxi | Pactera Wuxi | Pactera Wuxi | HURO | HURO | HURO | Pactera Jinxin | Pactera Jinxin | Glory | Glory | Glory | Pactera Beijing | Pactera Beijing | Pactera Beijing | Pactera Nanjing | Pactera Nanjing | Pactera Nanjing | Pactera Nanjing | Pactera Shenzhen | Pactera Shenzhen | Pactera Shenzhen | Pactera Shenzhen | Pactera Shenzhen | Pactera Shenzhen | Pactera Shenzhen | Beijing DPC | Beijing DPC | Beijing DPC | Pactera Shanghai | Pactera Shanghai | Pactera Shanghai | Pactera Shanghai | Pactera Shanghai | Pactera Shanghai | Pactera Shanghai | Pactera Shanghai | Sunwin | Sunwin | Pactera Japan | ISL | Minimum | Maximum | DMK International | Pactera NA | NouvEON | Pactera US | Pactera Singapore | AllianceSPEC | VanceInfo Singapore | Pactera Spain | Bearing Point | Pactera Australia | Pactera Malaysia | Pactera Mauritius | |||||||||||||||||||||||
Future | Advanced technology service enterprises | Advanced technology service enterprises | Advanced technology service enterprises | Advanced technology service enterprises | Software Enterprise | Software Enterprise | Software Enterprise | Software Enterprise | Software Enterprise | The new HNTE | Software Enterprise | Software Enterprise | Software Enterprise | Software Enterprise | Future | Key software enterprise | Key software enterprise | Advanced technology service enterprises | Key software enterprise | Key software enterprise | Key software enterprise | Key software enterprise | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Future | Future | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Current and deferred components of income tax expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Current tax expense | $7,585 | $6,107 | $2,382 | $5,404 | $5,295 | $968 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $61 | $41 | $78 | ' | ' | $299 | $10 | $330 | ' | ' | ' | ' | ' | ' | $515 | $670 | $1,006 | ' | ' | ' | ' | $1,239 | $91 | ' | ' | $67 | ' | ' | ' |
Deferred tax expense (benefit) | -2,617 | -4,897 | -664 | -293 | -2,070 | -881 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -802 | -102 | -42 | ' | ' | -1,181 | -2,486 | 241 | ' | ' | ' | ' | ' | ' | -276 | -81 | 18 | ' | ' | ' | ' | 226 | -155 | ' | ' | -291 | -3 | ' | ' |
Income tax expense | 4,968 | 1,210 | 1,718 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Income tax rate (as a percent) | ' | ' | ' | ' | ' | ' | 16.50% | 16.50% | 16.50% | 16.50% | 16.50% | 16.50% | 16.50% | 16.50% | 16.50% | 16.50% | 16.50% | 16.50% | 16.50% | 16.50% | 16.50% | 16.50% | 16.50% | 16.50% | 16.50% | 16.50% | 16.50% | 16.50% | 16.50% | 16.50% | 16.50% | 16.50% | 16.50% | 25.00% | 25.00% | 25.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 42.00% | 42.00% | ' | ' | ' | 15.00% | 39.00% | ' | ' | ' | ' | ' | ' | ' | 17.00% | 17.00% | 17.00% | 30.00% | ' | ' | 30.00% | 30.00% | ' | ' | 25.00% | 15.00% |
State income taxes (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 6.00% | 8.84% | 6.90% | 8.84% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Preferential tax rate (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10.00% | 10.00% | 10.00% | 10.00% | 15.00% | 15.00% | 15.00% | 15.00% | 15.00% | 15.00% | 15.00% | 15.00% | 15.00% | 15.00% | 12.50% | 12.50% | 0.00% | ' | ' | 15.00% | 15.00% | 15.00% | 15.00% | 15.00% | 15.00% | 15.00% | 15.00% | 10.00% | 10.00% | 15.00% | 12.50% | 12.50% | 12.50% | ' | 10.00% | 12.50% | 0.00% | ' | 12.50% | 10.00% | 10.00% | 15.00% | 15.00% | 15.00% | 15.00% | 10.00% | 10.00% | 15.00% | 10.00% | 10.00% | 10.00% | 10.00% | 15.00% | 15.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Term of income tax holiday | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '3 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '2 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
HNTE status additional period available on re-application | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '3 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Preferential tax partial exemption period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '3 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '3 years | ' | ' | ' | '3 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of tax deduction | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 50.00% | 50.00% | ' | ' | 50.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 50.00% | 50.00% | 50.00% | ' | 50.00% | 50.00% | ' | ' | 50.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Deferred tax assets | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Gross | 17,681 | 16,829 | 5,949 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Less: Valuation allowance | -4,531 | -4,596 | -5,033 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total net deferred tax assets | 13,150 | 12,233 | 916 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Deferred tax assets - current: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Allowance for doubtful accounts | 1,667 | 2,742 | 1,954 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Accrued expenses | 6,249 | 6,217 | 131 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total deferred taxes assets - current | 7,916 | 8,959 | 2,085 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Less: Valuation allowance | -130 | -19 | -1,462 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net deferred tax assets - current, net | 7,786 | 8,940 | 623 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Deferred tax assets - non-current: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net operating losses | 9,138 | 6,975 | 3,811 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Depreciation | 627 | 895 | 53 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total deferred taxes assets - non-current | 9,765 | 7,870 | 3,864 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Less: Valuation allowance | -4,401 | -4,577 | -3,571 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net deferred tax assets - non-current, net | 5,364 | 3,293 | 293 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Current deferred tax liabilities: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Depreciation | ' | ' | -8 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Unbilled account receivables | -352 | -411 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Current deferred tax liabilities | -352 | -411 | -8 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Non-current deferred tax liabilities: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Intangible assets | -9,312 | -11,145 | -3,017 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Depreciation | -133 | -116 | -88 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Non-current deferred tax liabilities | ($9,445) | ($11,261) | ($3,105) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
INCOME_TAXES_Details_2
INCOME TAXES (Details 2) (Subsidiaries, USD $) | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
In Thousands, unless otherwise specified | |||
PRC | ' | ' | ' |
Operating loss carry forwards | ' | ' | ' |
Net operating loss carry forwards | $17,758 | $5,313 | $2,907 |
Outside PRC | ' | ' | ' |
Operating loss carry forwards | ' | ' | ' |
Net operating loss carry forwards | $21,436 | $21,503 | $7,514 |
INCOME_TAXES_Details_3
INCOME TAXES (Details 3) (USD $) | 12 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Income tax expense reconciliation | ' | ' | ' |
Tax expenses at statutory tax rate in PRC | $3,184 | $1,128 | $5,029 |
Permanent differences | 695 | 314 | 551 |
Different tax jurisdictions | 6,556 | 3,253 | 306 |
Tax holiday in the PRC | -4,225 | -3,102 | -4,788 |
Change in valuation allowance | -65 | -437 | 861 |
Preferential tax refund | -1,724 | ' | ' |
Other | 547 | 54 | -241 |
Income tax expense | 4,968 | 1,210 | 1,718 |
Components of consolidated income before income tax expense | ' | ' | ' |
Income before income tax expense and earnings in equity method investment | 12,737 | 4,512 | 20,116 |
Cayman Islands | ' | ' | ' |
Components of consolidated income before income tax expense | ' | ' | ' |
Domestic (Cayman Islands) | -26,246 | -22,937 | -7,125 |
PRC | ' | ' | ' |
Components of consolidated income before income tax expense | ' | ' | ' |
Foreign | 26,887 | 19,795 | 18,873 |
Tax expense additional information | ' | ' | ' |
Income tax rate if deemed as resident PRC | 25.00% | 25.00% | 25.00% |
Withholding tax for PRC subsidiaries (as a percent) | 10.00% | ' | ' |
Minimum percentage of equity interest in FIE considered for reduction in withholding income tax rate | 25.00% | ' | ' |
Withholding tax rate in case of subsidiary 25% or more directly owned by the resident in Hong Kong | 5.00% | ' | ' |
Withholding tax rate for the Company's subsidiary not considered to be beneficial owner of any such dividends | 10.00% | ' | ' |
Aggregate undistributed earnings of the company's subsidiaries located in the PRC | 222,624 | 179,601 | 79,611 |
Provision for dividend withholding taxes | 0 | 0 | 0 |
Others | ' | ' | ' |
Components of consolidated income before income tax expense | ' | ' | ' |
Foreign | 12,096 | 7,654 | 8,368 |
Tax holidays granted to PRC subsidiaries is not available | PRC | ' | ' | ' |
Income tax holiday | ' | ' | ' |
Increase in income tax expenses without the tax holidays | $4,225 | $3,102 | $4,788 |
Impact of tax holiday on basic net income per common share (in dollars per share) | $0.06 | $0.06 | $0.12 |
Impact of tax holiday on diluted net income per common share (in dollars per share) | $0.05 | $0.06 | $0.11 |
COMMON_SHARES_Details
COMMON SHARES (Details) (USD $) | 12 Months Ended | 12 Months Ended | 1 Months Ended | 12 Months Ended | |||||||
In Millions, except Share data, unless otherwise specified | Dec. 31, 2012 | Dec. 31, 2013 | Nov. 30, 2012 | Oct. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2012 | Dec. 31, 2013 |
Share Incentive Plan and 2011 Equity Incentive Plan | Beijing DPC, Beijing Sunwin, and Pactera Financial Solution | Common Stock | Common Stock | Common Stock | ADS | ADS | |||||
Share- based compensation plan | Share- based compensation plan | Share- based compensation plan | |||||||||
Common Shares | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common share consolidation ratio in connection with the merger of equals with VanceInfo | 13.9482 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of ordinary share represented by each American Depository Share | ' | 1 | 1 | 19 | ' | ' | ' | ' | ' | ' | ' |
Shares authorized under repurchase program | ' | ' | ' | ' | ' | ' | ' | ' | ' | $30 | ' |
Period over which shares will be repurchased under the repurchase program | ' | ' | ' | ' | ' | ' | ' | ' | ' | '12 months | ' |
Shares repurchased | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4,643,359 |
Total consideration for repurchase of shares | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $30 |
Number of repurchased shares cancelled | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,900,000 |
Shares issued for future delivery to employees | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,743,359 |
Number of common shares issued | ' | ' | ' | ' | ' | 319,556 | ' | ' | ' | ' | ' |
Vesting of nonvested shares award (in shares) | ' | ' | ' | ' | 150,975 | ' | ' | ' | ' | ' | ' |
Issuance of common shares for share-based compensation | ' | ' | ' | ' | ' | ' | 1,743,359 | 2,150,814 | 1,075,406 | ' | ' |
Common shares, outstanding (in shares) | 88,312,068 | 85,503,321 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Par value of common stock issued (in dollars per share) | $0.00 | $0.00 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
SHAREBASED_COMPENSATION_PLAN_D
SHARE-BASED COMPENSATION PLAN (Details) (USD $) | 12 Months Ended | 12 Months Ended | 12 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended | |||||||||||||||||||
Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2009 | Dec. 31, 2008 | Dec. 31, 2007 | Dec. 31, 2006 | Jan. 01, 2005 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Mar. 31, 2010 | Dec. 31, 2013 | Jul. 01, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Jul. 03, 2011 | Nov. 09, 2012 | Dec. 31, 2013 | Nov. 09, 2012 | Nov. 09, 2012 | Nov. 09, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Nov. 09, 2012 | Dec. 31, 2013 | Nov. 09, 2012 | Nov. 09, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | |
Stock options | Stock options | Stock options | Share Incentive Plan | Share Incentive Plan | Share Incentive Plan | Share Incentive Plan | Share Incentive Plan | Share Incentive Plan | Share Incentive Plan | Share Incentive Plan | Special option plan | 2011 Equity Incentive Plan | 2011 Equity Incentive Plan | 2011 Equity Incentive Plan | 2011 Equity Incentive Plan | 2011 Equity Incentive Plan | Amended 2011 Equity Incentive Plan | VanceInfo 2005 Stock Option Plan | VanceInfo 2005 Stock Option Plan | VanceInfo 2005 Stock Option Plan | VanceInfo 2005 Stock Option Plan | VanceInfo 2005 Stock Option Plan | VanceInfo 2005 Stock Option Plan | VanceInfo 2005 Stock Option Plan | VanceInfo 2007 Share Incentive Plan | VanceInfo 2007 Share Incentive Plan | VanceInfo 2007 Share Incentive Plan | VanceInfo 2007 Share Incentive Plan | VanceInfo 2007 Share Incentive Plan | VanceInfo 2007 Share Incentive Plan | |
Minimum | Maximum | Stock options | Stock options | Stock options | Stock options | Stock options | Stock options | Minimum | Maximum | Stock options | Stock options | Stock options | Maximum | Stock options | Stock options | Stock options | |||||||||||||||
SHARE-BASED COMPENSATION PLAN | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Approved number of shares may be issued | ' | ' | ' | ' | ' | ' | ' | 734,862 | ' | ' | ' | 716,938 | 8,048,874 | 1,290,489 | ' | ' | ' | 8,048,874 | 1,867,500 | ' | ' | ' | ' | ' | ' | 1,100,000 | ' | ' | ' | ' | ' |
Number of additional shares approved for grant | ' | ' | ' | 716,938 | 290,213 | 1,111,254 | 3,039,819 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Annual increase to authorized shares (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2.50% | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3.00% | ' | ' | ' |
Number of options and nonvested shares granted to employees | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 6,501,435 | ' | ' | ' | ' | ' | ' | 1,093,435 | ' | ' | ' | ' | ' | ' | 2,049,611 | ' | ' | ' | ' |
Shares exercisable after expiration term | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0 | ' | ' | ' | ' | ' | ' | ' | ' | 0 | ' | ' | ' | ' | ' | ' | ' |
Expiration term of options from date of grant | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '10 years | ' | ' | ' | '10 years | ' | ' | ' | ' | ' | ' | ' | ' | '10 years | ' | ' | ' |
Percentage of awards vesting on first anniversary under alternative one | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 50.00% | ' | ' | ' | 25.00% | ' | ' | ' | ' | ' | ' | 25.00% | ' | ' | ' | ' | ' |
Percentage of awards vesting on first anniversary under alternative two | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 33.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of awards vesting on first anniversary under alternative three | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 25.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 25.00% | ' | ' | ' | ' | ' |
First award vesting period from date of grant | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '1 year | ' | ' | ' | ' | ' | '9 months | '1 year | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of awards vesting on quarterly anniversaries from first vesting date under alternative one | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 12.50% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of awards vesting on quarterly anniversaries from first vesting date under alternative two | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 8.30% | ' | ' | ' | 2.00% | ' | ' | ' | ' | ' | ' | 6.25% | ' | ' | ' | ' | ' |
Percentage of awards vesting on quarterly anniversaries from first vesting date under alternative three | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 6.25% | ' | ' | ' | 6.25% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Termination of option | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Period to exercise options in case of termination with cause | '30 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Period to exercise options in case of termination without cause | '60 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Period to exercise options in case of termination by way of death or disability | '6 months | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of share options | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share options outstanding at the beginning of the period | ' | ' | ' | ' | ' | ' | ' | ' | 2,915,171 | 3,398,190 | 4,508,784 | ' | ' | ' | 249,139 | 34,055 | ' | ' | ' | ' | ' | ' | ' | 1,032,095 | ' | ' | ' | ' | ' | 2,482,088 | ' |
Granted (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 114,685 | ' | ' | ' | 40,100 | 215,084 | 34,055 | ' | ' | ' | ' | ' | 1,093,435 | ' | ' | ' | ' | ' | 2,557,084 | ' | ' |
Exercised (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | -691,372 | -401,179 | -1,007,740 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -223,715 | -61,340 | ' | ' | ' | ' | -111,844 | -25,908 |
Cancelled (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | -83,608 | -81,840 | -217,539 | ' | ' | ' | -43,623 | ' | ' | ' | ' | ' | ' | ' | ' | -1,588 | ' | ' | ' | ' | ' | -458,385 | -49,088 |
Share options outstanding at the end of the period | ' | ' | ' | ' | ' | ' | ' | ' | 2,140,191 | 2,915,171 | 3,398,190 | ' | ' | ' | 245,616 | 249,139 | 34,055 | ' | ' | ' | ' | ' | ' | 806,792 | 1,032,095 | ' | ' | ' | ' | 1,911,859 | 2,482,088 |
Weighted average exercise price | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share options outstanding at the beginning of the period (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | ' | $4.58 | $4.60 | $4.46 | ' | ' | ' | $7.46 | $8.79 | ' | ' | ' | ' | ' | ' | ' | $1.97 | ' | ' | ' | ' | ' | $7.57 | ' |
Granted (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $16.74 | ' | ' | ' | $7.75 | $7.25 | $8.79 | ' | ' | ' | ' | ' | $1.90 | ' | ' | ' | ' | ' | $7.56 | ' | ' |
Exercised (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | ' | $4.64 | $4.34 | $4.18 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $1.78 | $0.78 | ' | ' | ' | ' | $5.30 | $5.53 |
Cancelled (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | ' | $11.26 | $6.64 | $9.76 | ' | ' | ' | $8.20 | $7.60 | ' | ' | ' | ' | ' | ' | ' | $6.95 | ' | ' | ' | ' | ' | $7.87 | $7.96 |
Share options outstanding at the end of the period (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | ' | $4.37 | $4.58 | $4.60 | ' | ' | ' | $7.38 | $7.46 | $8.79 | ' | ' | ' | ' | ' | ' | $2.01 | $1.97 | ' | ' | ' | ' | $7.63 | $7.57 |
Other disclosures | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Weighted average grant-date fair value, granted (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $8.93 | ' | ' | ' | $3.75 | $3.77 | $4.32 | ' | ' | ' | ' | ' | $1.31 | ' | ' | ' | ' | ' | $6.18 | ' | ' |
Weighted average intrinsic value per option at the grant dates (in dollars) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $6,118,710 | ' | ' | ' | ' | ' | $1,138,653 | ' | ' |
Award vesting period | ' | '1 year | '4 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
SHAREBASED_COMPENSATION_PLAN_D1
SHARE-BASED COMPENSATION PLAN (Details 2) (Stock options, USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Share Incentive Plan | ' | ' | ' |
Options outstanding | ' | ' | ' |
Number outstanding (in shares) | 2,140,191 | ' | ' |
Weighted average remaining contractual life | '3 years 4 months 24 days | ' | ' |
Weighted average exercise price (in dollars per share) | $4.37 | ' | ' |
Aggregate intrinsic value (in dollars) | $6,013,406 | ' | ' |
Options exercisable | ' | ' | ' |
Number exercisable (in shares) | 2,134,557 | ' | ' |
Weighted average remaining contractual life | '3 years 4 months 20 days | ' | ' |
Weighted average exercise price (in dollars per share) | $4.36 | ' | ' |
Aggregate intrinsic value (in dollars) | 6,008,441 | ' | ' |
Number of options exercised (in shares) | 691,372 | 401,179 | 1,007,740 |
Total intrinsic value of options exercised (in dollars) | 1,226,000 | 1,881,000 | 11,142,000 |
2011 Equity Incentive Plan | ' | ' | ' |
Options outstanding | ' | ' | ' |
Number outstanding (in shares) | 245,616 | ' | ' |
Weighted average remaining contractual life | '8 years 14 days | ' | ' |
Weighted average exercise price (in dollars per share) | $7.38 | ' | ' |
Aggregate intrinsic value (in dollars) | 3,650 | ' | ' |
Options exercisable | ' | ' | ' |
Number exercisable (in shares) | 20,433 | ' | ' |
Weighted average remaining contractual life | '7 years 10 months 10 days | ' | ' |
Weighted average exercise price (in dollars per share) | $8.79 | ' | ' |
VanceInfo 2005 Stock Option Plan | ' | ' | ' |
Options outstanding | ' | ' | ' |
Number outstanding (in shares) | 806,792 | ' | ' |
Weighted average remaining contractual life | '2 years 3 months 18 days | ' | ' |
Weighted average exercise price (in dollars per share) | $2.01 | ' | ' |
Aggregate intrinsic value (in dollars) | 4,153,648 | ' | ' |
Options exercisable | ' | ' | ' |
Number exercisable (in shares) | 806,792 | ' | ' |
Weighted average remaining contractual life | '2 years 3 months 18 days | ' | ' |
Weighted average exercise price (in dollars per share) | $2.01 | ' | ' |
Aggregate intrinsic value (in dollars) | 4,153,648 | ' | ' |
Number of options exercised (in shares) | 223,715 | 61,340 | ' |
VanceInfo 2007 Share Incentive Plan | ' | ' | ' |
Options outstanding | ' | ' | ' |
Number outstanding (in shares) | 1,911,859 | ' | ' |
Weighted average remaining contractual life | '2 years 7 months 20 days | ' | ' |
Weighted average exercise price (in dollars per share) | $7.63 | ' | ' |
Aggregate intrinsic value (in dollars) | 567,787 | ' | ' |
Options exercisable | ' | ' | ' |
Number exercisable (in shares) | 1,316,968 | ' | ' |
Weighted average remaining contractual life | '2 years 3 months | ' | ' |
Weighted average exercise price (in dollars per share) | $7.51 | ' | ' |
Aggregate intrinsic value (in dollars) | $537,201 | ' | ' |
Number of options exercised (in shares) | 111,844 | 25,908 | ' |
SHAREBASED_COMPENSATION_PLAN_D2
SHARE-BASED COMPENSATION PLAN (Details 3) (Stock options, USD $) | 12 Months Ended | 0 Months Ended | 0 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended | ||||||||||||||||
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Nov. 09, 2012 | Nov. 09, 2012 | Nov. 09, 2012 | Nov. 09, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Nov. 09, 2012 | Dec. 31, 2013 | Dec. 31, 2012 |
employee | Minimum | Minimum | Maximum | Maximum | Share Incentive Plan | Share Incentive Plan | Share Incentive Plan | 2011 Equity Incentive Plan | 2011 Equity Incentive Plan | 2011 Equity Incentive Plan | Options granted under the merger and equal with VanceInfo | Options granted under the merger and equal with VanceInfo | Options granted under the merger and equal with VanceInfo | VanceInfo 2005 Stock Option Plan | VanceInfo 2005 Stock Option Plan | VanceInfo 2005 Stock Option Plan | VanceInfo 2007 Share Incentive Plan | VanceInfo 2007 Share Incentive Plan | VanceInfo 2007 Share Incentive Plan | |||
Minimum | Maximum | |||||||||||||||||||||
Share options | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Balance at the beginning of the period (in shares) | ' | ' | ' | ' | ' | ' | ' | 115,259 | 554,381 | 1,361,483 | 215,084 | 34,055 | ' | ' | ' | ' | ' | 1,093,310 | ' | ' | 2,426,615 | ' |
Granted (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | ' | 114,685 | 40,100 | 215,082 | 34,055 | ' | ' | ' | 1,093,435 | ' | ' | 2,557,084 | ' | ' |
Vested (in shares) | ' | ' | ' | ' | ' | ' | ' | -26,017 | -357,282 | -704,248 | ' | -34,055 | ' | ' | ' | ' | ' | -1,093,310 | -125 | ' | -1,373,339 | -81,381 |
Forfeited (in shares) | ' | ' | ' | ' | ' | ' | ' | -83,608 | -81,840 | -217,539 | -30,001 | -2 | ' | ' | ' | ' | ' | ' | ' | ' | -458,385 | -49,088 |
Balance at the end of the period (in shares) | ' | ' | ' | ' | ' | ' | ' | 5,634 | 115,259 | 554,381 | 225,183 | 215,084 | 34,055 | ' | ' | ' | ' | ' | 1,093,310 | ' | 594,891 | 2,426,615 |
Vested and expect to vest at the end of the period (in shares) | ' | ' | ' | ' | ' | ' | ' | 4,593,188 | ' | ' | 245,616 | ' | ' | ' | ' | ' | ' | 1,093,435 | ' | ' | 2,049,611 | ' |
Weighted average grant-date fair value | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Balance at the beginning of the period (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | $7.63 | $4.88 | $2.51 | $3.77 | $4.32 | ' | ' | ' | ' | ' | $1.31 | ' | ' | $6.23 | ' |
Granted (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | ' | ' | $8.93 | $3.75 | $3.77 | $4.32 | ' | ' | ' | $1.31 | ' | ' | $6.18 | ' | ' |
Vested (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | $1.39 | $3.01 | $1.67 | ' | $4.32 | ' | ' | ' | ' | ' | $1.31 | $1.71 | ' | $8.32 | $3.47 |
Forfeited (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | $4.91 | $9.21 | $4.18 | $3.83 | $3.89 | ' | ' | ' | ' | ' | ' | ' | ' | $6.58 | $8.35 |
Balance at the end of the period (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | $5.76 | $7.63 | $4.88 | $4.02 | $3.77 | $4.32 | ' | ' | ' | ' | ' | $1.31 | ' | $7.21 | $6.23 |
Weighted-average exercise price per share | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Balance at the beginning of the period (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | $8.88 | $6.56 | $5.58 | $7.25 | $8.79 | ' | ' | ' | ' | ' | $1.90 | ' | ' | $7.58 | ' |
Granted (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | ' | ' | $16.74 | $7.75 | $7.25 | $8.79 | ' | ' | ' | $1.90 | ' | ' | $7.56 | ' | ' |
Vested (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | ($8.49) | $5.79 | $5.30 | ' | $8.79 | ' | ' | ' | ' | ' | $1.90 | $3.50 | ' | $8.09 | $6.57 |
Forfeited (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | $11.26 | $6.64 | $9.76 | $8.20 | $7.60 | ' | ' | ' | ' | ' | $6.95 | ' | ' | $7.87 | $7.96 |
Balance at the end of the period (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | $8.47 | $8.88 | $6.56 | $7.25 | $7.25 | $8.79 | ' | ' | ' | ' | ' | $1.90 | ' | $7.90 | $7.58 |
Vested and expect to vest at the end of the period (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | $4.32 | ' | ' | $7.38 | ' | ' | ' | ' | ' | ' | $1.90 | ' | ' | $7.48 | ' |
Assumptions used to estimate fair value of awards | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Expected volatility, minimum (as a percent) | 50.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 52.00% | ' | ' | ' | ' | ' | ' | ' | ' |
Expected volatility, maximum (as a percent) | 51.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 66.00% | ' | ' | ' | ' | ' | ' | ' | ' |
Expected volatility, maximum (as a percent) | ' | 53.00% | 53.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Risk-free interest rate, minimum (as a percent) | 1.18% | ' | 1.44% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0.70% | ' | ' | ' | ' | ' | ' | ' | ' |
Risk-free interest rate, maximum (as a percent) | 1.23% | ' | 2.90% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1.40% | ' | ' | ' | ' | ' | ' | ' | ' |
Risk-free interest rate (as a percent) | ' | 1.04% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Expected life | ' | '6 years 6 months | ' | '5 years 10 months 13 days | '5 years 6 months | '6 years 1 month 10 days | '6 years 1 month 6 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Exercise price (in dollars per share) | ' | $7.25 | ' | $6.42 | $8.79 | $7.94 | $22.18 | ' | ' | ' | ' | ' | ' | ' | $4.58 | $11 | ' | ' | ' | ' | ' | ' |
Fair value of the underlying common shares (in dollars per share) | ' | $7.49 | ' | $6.42 | $8.79 | $7.94 | $22.18 | ' | ' | ' | ' | ' | ' | $7.49 | ' | ' | ' | ' | ' | ' | ' | ' |
Unrecognized compensation expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total unrecognized compensation expense related to share options granted (in dollars) | $1,375 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Weighted-average period for recognition of compensation cost | '1 year 2 months 26 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Fully vested share options of which contractual life is extended | 281,804 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of employees who held fully vested share options with contractual life extended | 140 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Additional compensation expense recognized | $278 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
SHAREBASED_COMPENSATION_PLAN_D3
SHARE-BASED COMPENSATION PLAN (Details 4) (USD $) | 12 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended | |||||||||||||||||
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Jan. 02, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Nov. 09, 2012 | Nov. 09, 2012 | Dec. 31, 2013 | Dec. 31, 2012 |
Pactera Financial Solutions | Nonvested shares | Nonvested shares | Nonvested shares | Nonvested shares | Nonvested shares | Nonvested shares | Performance based share award options and nonvested shares | Performance based share award options and nonvested shares | Stock options | Share Incentive Plan | Share Incentive Plan | Share Incentive Plan | 2011 Equity Incentive Plan | 2011 Equity Incentive Plan | 2011 Equity Incentive Plan | VanceInfo 2007 Share Incentive Plan | VanceInfo 2007 Share Incentive Plan | VanceInfo 2007 Share Incentive Plan | VanceInfo 2007 Share Incentive Plan | ||||
Pactera Financial Solutions | Pactera Financial Solutions | Pactera Financial Solutions | Nonvested shares | Nonvested shares | Nonvested shares | Nonvested shares | Nonvested shares | Stock options | Nonvested shares | Nonvested shares | Nonvested shares | ||||||||||||
SHARE-BASED COMPENSATION PLAN | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of awards vesting on first anniversary under alternative one | ' | ' | ' | ' | 50.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 50.00% | 25.00% | ' | ' | ' |
Percentage of awards vesting on first anniversary under alternative two | ' | ' | ' | ' | 33.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 33.00% | ' | ' | ' | ' |
Percentage of awards vesting on first anniversary under alternative three | ' | ' | ' | ' | 25.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 25.00% | 25.00% | ' | ' | ' |
First award vesting period from date of grant | ' | ' | ' | ' | '1 year | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '1 year | ' | ' | ' | ' |
Percentage of awards vesting on monthly anniversaries from first vesting date under alternative one | ' | ' | ' | ' | 4.17% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of awards vesting on monthly anniversaries from first vesting date under alternative two | ' | ' | ' | ' | 2.78% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of awards vesting on monthly anniversaries from first vesting date under alternative three | ' | ' | ' | ' | 2.08% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of awards vesting on quarterly anniversaries from first vesting date under alternative one | ' | ' | ' | ' | 12.50% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 12.50% | ' | ' | ' | ' |
Percentage of awards vesting on quarterly anniversaries from first vesting date under alternative two | ' | ' | ' | ' | 8.30% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 8.30% | 6.25% | ' | ' | ' |
Percentage of awards vesting on quarterly anniversaries from first vesting date under alternative three | ' | ' | ' | ' | 6.25% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 6.25% | ' | ' | ' | ' |
Nonvested shares | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Outstanding at the beginning of the period (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,494,334 | 695,430 | ' | 227,408 | 409,127 | 337,443 | 4,466,979 | 1,045,698 | ' | ' | ' | 683,974 | ' |
Granted (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | 1,000,000 | ' | ' | 1,870,614 | ' | ' | 2,719 | 361,256 | 1,899,121 | 3,833,474 | ' | ' | 722,869 | ' | ' |
Vested (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | ' | 395,000 | ' | ' | ' | 57,373 | 156,072 | 273,850 | 210,086 | 291,513 | ' | ' | ' | 250,704 | 14,738 |
Forfeited (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -156,505 | -71,710 | ' | -3,406 | -28,366 | -15,722 | -401,794 | -120,680 | ' | ' | ' | -99,355 | -24,157 |
Outstanding at the end of the period (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,337,829 | 2,494,334 | ' | 166,629 | 227,408 | 409,127 | 5,754,220 | 4,466,979 | ' | ' | ' | 333,915 | 683,974 |
Nonvested shares vested and expect to vest at the end of the period (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,686,203 | ' | ' | 6,255,819 | ' | ' | ' | ' | 599,357 | ' |
Options and nonvested shares vested and expect to vest | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,783,106 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Weighted average grant date fair value | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Outstanding at the beginning of the period (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $7.86 | $9.96 | ' | $13.57 | $13.25 | $8.37 | $8.13 | $10.18 | ' | ' | ' | $16.65 | ' |
Granted (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $7.07 | ' | ' | $11.02 | $12.83 | $7.30 | $7.83 | ' | ' | $16.56 | ' | ' |
Vested (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $13.95 | $13.06 | $6.83 | $8.88 | $10.41 | ' | ' | ' | $17.52 | $16.23 |
Forfeited (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $7.49 | $7.49 | ' | $18.06 | $11.50 | $9.07 | $8.18 | $10.95 | ' | ' | ' | $18.37 | $14.13 |
Outstanding at the end of the period (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $7.20 | $7.86 | ' | $13.45 | $13.57 | $13.25 | $7.55 | $8.13 | ' | ' | ' | $15.48 | $16.65 |
Intrinsic value | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Outstanding at the beginning of the period (in dollars) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $19,453,321 | $6,925,500 | ' | $3,102,299 | $5,437,147 | $2,806,766 | $36,271,999 | $10,600,967 | ' | ' | ' | $11,388,057 | ' |
Granted (in dollars) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 13,064,870 | ' | ' | 29,960 | 4,650,290 | 13,863,583 | 30,027,735 | ' | ' | 11,968,510 | ' | ' |
Vested (in dollars) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -800,353 | -2,038,640 | -1,876,338 | -1,865,564 | -3,034,746 | ' | ' | ' | -4,392,334 | -239,145 |
Forfeited (in dollars) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -1,172,222 | -537,049 | ' | -61,512 | -326,168 | -143,571 | -3,286,675 | -1,321,957 | ' | ' | ' | -1,825,151 | -341,308 |
Outstanding at the end of the period (in dollars) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 18,281,099 | 19,453,321 | ' | 2,240,434 | 3,102,299 | 5,437,147 | 44,983,343 | 36,271,999 | ' | ' | ' | 5,170,572 | 11,388,057 |
Number of shares no longer subject to the performance-based vesting criteria | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,118,424 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Commitment to grant nonvested shares to key employees (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | 33.30% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Noncontrolling interest (as a percent) | ' | ' | ' | 100.00% | ' | ' | ' | ' | ' | 16.50% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total consideration for minority equity interest purchased | 6,294 | 12,938 | ' | ' | ' | ' | ' | 6,300 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Compensation cost recognized (in dollars) | 22,858 | 11,064 | 5,656 | ' | 19,436 | 9,600 | 4,388 | ' | ' | ' | ' | 1,915 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Unrecognized compensation expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total unrecognized compensation expense related to share options granted (in dollars) | ' | ' | ' | ' | 21,197 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Weighted-average period for recognition of compensation cost | ' | ' | ' | ' | '1 year 10 months 28 days | ' | ' | ' | ' | ' | ' | ' | '1 year 2 months 26 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Tax benefit related to share based compensation expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
SHAREBASED_COMPENSATION_PLAN_D4
SHARE-BASED COMPENSATION PLAN (Details 5) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Allocation of share-based compensation expenses | ' | ' | ' |
Share-based compensation expense, total | $22,858 | $11,064 | $5,656 |
Cost of revenues | ' | ' | ' |
Allocation of share-based compensation expenses | ' | ' | ' |
Share-based compensation expense, total | 466 | 165 | 234 |
General and administrative | ' | ' | ' |
Allocation of share-based compensation expenses | ' | ' | ' |
Share-based compensation expense, total | 21,466 | 10,405 | 4,906 |
Selling and marketing | ' | ' | ' |
Allocation of share-based compensation expenses | ' | ' | ' |
Share-based compensation expense, total | $926 | $494 | $516 |
CHINA_CONTRIBUTION_PLAN_AND_PR1
CHINA CONTRIBUTION PLAN AND PROFIT APPROPRIATION (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
CHINA CONTRIBUTION PLAN AND PROFIT APPROPRIATION | ' | ' | ' |
Employee benefit expenses | $48,383 | $22,556 | $13,268 |
Appropriation of after-tax profits to general reserve fund, percentage | 10.00% | ' | ' |
Limit of general reserve fund as a percentage of registered capital, after which appropriations to general reserve fund are no longer required | 50.00% | ' | ' |
Appropriations to statutory surplus reserve fund | 2,865 | 729 | 2,875 |
Amount of restricted net assets | $185,913 | $170,284 | ' |
NET_INCOME_PER_SHARE_Details
NET INCOME PER SHARE (Details) (USD $) | 12 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Numerator used in basic and diluted net income per common share: | ' | ' | ' |
Net income attributable to Pactera Technology International Ltd. Shareholders | $7,837 | $2,590 | $17,901 |
Shares (denominator): | ' | ' | ' |
Weighted average common shares outstanding used in computing basic net income per common share | 81,942,795 | 47,547,307 | 40,596,429 |
Plus incremental weighted average common shares from assumed exercise of share options and vesting of nonvested shares using treasury stock method and shares issuable in connection with business acquisition | 3,010,251 | 1,896,853 | 2,359,862 |
Weighted average common shares outstanding used in computing basic net income per common share | 84,953,046 | 49,444,160 | 42,956,291 |
Net income per common share attributable to shareholders of Pactera Technology International Ltd. - Basic (in dollars per share) | $0.10 | $0.05 | $0.44 |
Net income per common share attributable to shareholders of Pactera Technology International Ltd. - Diluted (in dollars per share) | $0.09 | $0.05 | $0.42 |
NET_INCOME_PER_SHARE_Details_2
NET INCOME PER SHARE (Details 2) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
NET INCOME PER SHARE | ' | ' | ' |
Common shares reserved for future delivery to employees upon exercise of vested share options or grant of nonvested shares | 4,085,575 | ' | ' |
Share options and nonvested shares excluded from dilutive share calculation | 3,623,956 | 1,052,480 | 471,009 |
LEASES_AND_COMMITMENTS_Details
LEASES AND COMMITMENTS (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
LEASES AND COMMITMENTS | ' | ' | ' |
Rental expenses under operating leases | $21,599 | $10,472 | $6,336 |
Capital leases | ' | ' | ' |
Less: Accumulated amortization | -91 | ' | ' |
Capital lease amortization expense | 91 | 106 | 105 |
Future minimum lease payments for operating leases | ' | ' | ' |
2014 | 11,163 | ' | ' |
2015 | 8,236 | ' | ' |
2016 | 3,984 | ' | ' |
2017 | 1,582 | ' | ' |
2018 and thereafter | 1,490 | ' | ' |
Total minimum lease payments | 26,455 | ' | ' |
Furniture, fixtures and electronic equipment | ' | ' | ' |
Capital leases | ' | ' | ' |
Assets under capital leases, gross | $91 | ' | ' |
SEGMENT_INFORMATION_AND_REVENU2
SEGMENT INFORMATION AND REVENUE ANALYSIS (Details) (USD $) | 2 Months Ended | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
item | item | item | ||
SEGMENT INFORMATION AND REVENUE ANALYSIS | ' | ' | ' | ' |
Number of reportable segment | ' | 1 | 1 | ' |
Number of operating segments | ' | 1 | 2 | ' |
Number of reporting units | 2 | 1 | ' | ' |
Net revenues and long-lived assets by operating location | ' | ' | ' | ' |
Net revenues | ' | $670,019 | $359,031 | $218,989 |
Long-lived Assets | 259,402 | 278,081 | 259,402 | 67,872 |
Greater China | ' | ' | ' | ' |
Net revenues and long-lived assets by operating location | ' | ' | ' | ' |
Net revenues | ' | 401,988 | 172,316 | 87,264 |
Long-lived Assets | 197,559 | 219,380 | 197,559 | 37,405 |
United States | ' | ' | ' | ' |
Net revenues and long-lived assets by operating location | ' | ' | ' | ' |
Net revenues | ' | 135,647 | 75,306 | 49,271 |
Long-lived Assets | 31,729 | 31,118 | 31,729 | 19,922 |
Asia South | ' | ' | ' | ' |
Net revenues and long-lived assets by operating location | ' | ' | ' | ' |
Net revenues | ' | 69,884 | 45,276 | 29,673 |
Long-lived Assets | 23,984 | 21,700 | 23,984 | 8,549 |
Japan | ' | ' | ' | ' |
Net revenues and long-lived assets by operating location | ' | ' | ' | ' |
Net revenues | ' | 49,623 | 60,137 | 47,671 |
Long-lived Assets | 2,743 | 2,496 | 2,743 | 1,996 |
Europe | ' | ' | ' | ' |
Net revenues and long-lived assets by operating location | ' | ' | ' | ' |
Net revenues | ' | 12,877 | 5,996 | 5,110 |
Long-lived Assets | $3,387 | $3,387 | $3,387 | ' |
SEGMENT_INFORMATION_AND_REVENU3
SEGMENT INFORMATION AND REVENUE ANALYSIS (Details 2) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
item | |||
SEGMENT INFORMATION AND REVENUE ANALYSIS | ' | ' | ' |
Number of services lines | 3 | ' | ' |
Net revenues | $670,019 | $359,031 | $218,989 |
ITS | ' | ' | ' |
SEGMENT INFORMATION AND REVENUE ANALYSIS | ' | ' | ' |
Net revenues | 398,915 | 212,448 | 126,105 |
RDS | ' | ' | ' |
SEGMENT INFORMATION AND REVENUE ANALYSIS | ' | ' | ' |
Net revenues | 259,606 | 144,173 | 92,884 |
BPO | ' | ' | ' |
SEGMENT INFORMATION AND REVENUE ANALYSIS | ' | ' | ' |
Net revenues | $11,498 | $2,410 | ' |
SUBSEQUENT_EVENTS_Details
SUBSEQUENT EVENTS (Details) (USD $) | 1 Months Ended | 0 Months Ended | 12 Months Ended | 0 Months Ended | 0 Months Ended | 12 Months Ended | 0 Months Ended | ||||
Jul. 31, 2013 | Jan. 02, 2014 | Dec. 31, 2013 | 17-May-13 | 20-May-13 | Dec. 31, 2013 | Oct. 17, 2013 | Oct. 17, 2013 | Dec. 27, 2013 | Dec. 31, 2013 | Dec. 27, 2013 | |
Subsequent event | Subsequent event | Subsequent event | Subsequent event | Subsequent event | Subsequent event | Subsequent event | Subsequent event | Subsequent event | Subsequent event | ||
Innoveo | Innoveo | ADS | ADS | Merger Agreement | Merger Agreement | Merger Agreement | Transfer Agreement | Transfer Agreement | Transfer Agreement | ||
Buyer Consortium | Minimum | ADS | Common share | ChinaSoft | ChinaSoft | ChinaSoft | |||||
Disposal group related to Huawei | Disposal group related to Huawei | Disposal group related to Huawei | |||||||||
item | Future | ||||||||||
SUBSEQUENT EVENTS | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Proposed share price offered in an going private transaction | ' | ' | ' | ' | $7.50 | ' | ' | ' | ' | ' | ' |
Share price to be received by shareholders (in dollars per share) | ' | ' | ' | ' | ' | ' | $7.30 | $7.30 | ' | ' | ' |
Closing price (in dollars per share) | ' | ' | ' | $5.26 | ' | ' | ' | ' | ' | ' | ' |
Percentage of premium over closing price | ' | ' | ' | ' | ' | ' | 39.00% | ' | ' | ' | ' |
Percentage of premium to the volume-weighted average closing price | ' | ' | ' | ' | ' | ' | 35.00% | ' | ' | ' | ' |
Period prior to May 20,2013 for premium to the volume-weighted average closing price | ' | ' | ' | ' | ' | ' | '30 days | ' | ' | ' | ' |
Shareholder's affirmative vote for approval of merger agreement (as a percent) | ' | ' | ' | ' | ' | 67.00% | ' | ' | ' | ' | ' |
Number of parties under the agreement | ' | ' | ' | ' | ' | ' | ' | ' | 2 | ' | ' |
Total consideration for transfer | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $49,600,000 |
Cash received as part of consideration | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3,800,000 | ' |
Amount agreed to pay certain employees to motivate the completion of the transaction | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,500,000 |
Ownership interest acquired (as a percent) | ' | 100.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total consideration | ' | 3,200,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total consideration estimated subject to future performance measures | ' | 2,800,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cash consideration paid | $9,004,000 | ' | $1,200,000 | ' | ' | ' | ' | ' | ' | ' | ' |
SCHEDULE_I_CONDENSED_FINANCIAL1
SCHEDULE I CONDENSED FINANCIAL INFORMATION OF PARENT COMPANY (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 |
In Thousands, unless otherwise specified | ||||
Current Assets: | ' | ' | ' | ' |
Cash and cash equivalents | $148,518 | $143,714 | $113,856 | $169,893 |
Other current assets | 1,007 | 1,235 | ' | ' |
Total current assets | 466,796 | 478,204 | ' | ' |
Investment in subsidiaries and VIE | 318 | 250 | ' | ' |
TOTAL ASSETS | 744,877 | 737,606 | ' | ' |
Current Liabilities: | ' | ' | ' | ' |
Accrued expenses and other payables | 121,758 | 103,044 | ' | ' |
Total current liabilities | 180,151 | 163,152 | ' | ' |
TOTAL LIABILITIES | 194,604 | 195,282 | ' | ' |
Shareholders' Equity: | ' | ' | ' | ' |
Common shares ($0.00139482 par value; 120,000,000 shares authorized; 88,312,068 and 85,503,321 shares issued and outstanding as of December 31, 2012 and 2013, respectively) | 119 | 123 | ' | ' |
Additional paid-in capital | 497,391 | 502,748 | ' | ' |
Shares issuable in connection with business acquisition | 2,503 | 1,537 | ' | ' |
Accumulated other comprehensive income | 24,626 | 18,780 | ' | ' |
Total Pactera Technology International Ltd. shareholders' equity | 550,273 | 540,985 | ' | ' |
TOTAL LIABILITIES AND EQUITY | 744,877 | 737,606 | ' | ' |
Parent Company | ' | ' | ' | ' |
Current Assets: | ' | ' | ' | ' |
Cash and cash equivalents | 16,100 | 28,972 | 27,062 | 75,921 |
Other current assets | 880 | 302 | ' | ' |
Total current assets | 16,980 | 29,274 | ' | ' |
Investment in subsidiaries and VIE | 545,842 | 521,655 | ' | ' |
TOTAL ASSETS | 562,822 | 550,929 | ' | ' |
Current Liabilities: | ' | ' | ' | ' |
Accrued expenses and other payables | 12,549 | 9,944 | ' | ' |
Total current liabilities | 12,549 | 9,944 | ' | ' |
TOTAL LIABILITIES | 12,549 | 9,944 | ' | ' |
Shareholders' Equity: | ' | ' | ' | ' |
Common shares ($0.00139482 par value; 120,000,000 shares authorized; 88,312,068 and 85,503,321 shares issued and outstanding as of December 31, 2012 and 2013, respectively) | 119 | 123 | ' | ' |
Additional paid-in capital | 497,391 | 502,748 | ' | ' |
Shares issuable in connection with business acquisition | 2,503 | 1,537 | ' | ' |
Retained earnings | 25,634 | 17,797 | ' | ' |
Accumulated other comprehensive income | 24,626 | 18,780 | ' | ' |
Total Pactera Technology International Ltd. shareholders' equity | 550,273 | 540,985 | 208,484 | 174,952 |
TOTAL LIABILITIES AND EQUITY | $562,822 | $550,929 | ' | ' |
SCHEDULE_I_CONDENSED_FINANCIAL2
SCHEDULE I CONDENSED FINANCIAL INFORMATION OF PARENT COMPANY (Details 2) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Condensed Financial Information of Parent Company | ' | ' |
Common shares, par value (in dollars per share) | $0.00 | $0.00 |
Common shares, shares authorized | 120,000,000 | 120,000,000 |
Common shares, shares issued | 85,503,321 | 88,312,068 |
Common shares, shares outstanding | 85,503,321 | 88,312,068 |
Parent Company | ' | ' |
Condensed Financial Information of Parent Company | ' | ' |
Common shares, par value (in dollars per share) | $0.00 | $0.00 |
Common shares, shares authorized | 120,000,000 | 120,000,000 |
Common shares, shares issued | 85,503,321 | 88,312,068 |
Common shares, shares outstanding | 85,503,321 | 88,312,068 |
SCHEDULE_I_CONDENSED_FINANCIAL3
SCHEDULE I CONDENSED FINANCIAL INFORMATION OF PARENT COMPANY (Details 3) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Operating expenses | ' | ' | ' |
General and administrative | ($136,863) | ($89,875) | ($38,533) |
Selling and marketing | -46,706 | -27,741 | -16,924 |
Total operating expenses | -182,671 | -122,472 | -57,281 |
Interest expense | -27 | -70 | -102 |
Interest income | 2,220 | 3,685 | 2,979 |
Net loss before income from subsidiaries and VIE | 12,737 | 4,512 | 20,116 |
Equity in income of subsidiaries and VIE | 68 | 23 | ' |
Parent Company | ' | ' | ' |
Operating expenses | ' | ' | ' |
General and administrative | -24,666 | -23,074 | -7,156 |
Selling and marketing | -925 | -494 | -533 |
Total operating expenses | -25,591 | -23,568 | -7,689 |
Interest expense | ' | ' | -43 |
Interest income | 27 | 645 | 607 |
Net loss before income from subsidiaries and VIE | -25,564 | -22,923 | -7,125 |
Equity in income of subsidiaries and VIE | 33,401 | 25,513 | 25,026 |
Net income | $7,837 | $2,590 | $17,901 |
SCHEDULE_I_CONDENSED_FINANCIAL4
SCHEDULE I CONDENSED FINANCIAL INFORMATION OF PARENT COMPANY (Details 4) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Condensed Financial Information of Parent Company | ' | ' | ' |
Net income | $7,837 | $2,590 | $17,901 |
Other comprehensive income, net of tax: | ' | ' | ' |
Change in cumulative foreign currency translation adjustment | 5,846 | 2,460 | 5,738 |
Comprehensive income attributable to Pactera Technology International Ltd. | 13,683 | 5,043 | 23,639 |
Parent Company | ' | ' | ' |
Condensed Financial Information of Parent Company | ' | ' | ' |
Net income | 7,837 | 2,590 | 17,901 |
Other comprehensive income, net of tax: | ' | ' | ' |
Change in cumulative foreign currency translation adjustment | 5,846 | 2,453 | 5,738 |
Comprehensive income attributable to Pactera Technology International Ltd. | $13,683 | $5,043 | $23,639 |
SCHEDULE_I_CONDENSED_FINANCIAL5
SCHEDULE I CONDENSED FINANCIAL INFORMATION OF PARENT COMPANY (Details 5) (USD $) | 12 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Increase (Decrease) in Stockholders' Equity | ' | ' | ' |
Balance | $540,985 | ' | ' |
Balance (in shares) | 88,312,068 | ' | ' |
Repurchase of common shares | -30,000 | ' | ' |
Issuance of common shares for share-based compensation | ' | 14 | 2 |
Issuance of common share for business acquisition | ' | 326,778 | ' |
Share-based compensation | 23,000 | 11,125 | 5,656 |
Acquisition of non-controlling interest | -6,294 | -12,938 | ' |
Stock option exercise | 4,201 | 1,933 | 4,235 |
Disposal of variable interest entity | -71 | ' | ' |
Shares issuable in connection with business acquisition | 3,430 | 918 | ' |
Foreign currency translation adjustments | 5,846 | 2,460 | 5,738 |
Balance | 550,273 | 540,985 | ' |
Balance (in shares) | 85,503,321 | 88,312,068 | ' |
Common shares | ' | ' | ' |
Increase (Decrease) in Stockholders' Equity | ' | ' | ' |
Balance (in shares) | 88,312,068 | 42,720,067 | 41,536,412 |
Repurchase of common shares (in shares) | -4,643,359 | -1 | -2 |
Cancellation of common shares and treasury stock | -4 | ' | ' |
Cancellation of common shares and treasury stock (in shares) | -379,278 | ' | ' |
Reissuance of treasury stock for share based compensation (in shares) | 1,743,359 | ' | ' |
Issuance of common shares for share-based compensation | ' | 3 | 2 |
Issuance of common shares for share-based compensation (in shares) | ' | 2,150,814 | 1,075,406 |
Issuance of common share for business acquisition | ' | 60 | ' |
Issuance of common share for business acquisition (in shares) | 319,556 | 43,441,188 | ' |
Vesting of nonvested shares award (in shares) | 150,975 | ' | 108,251 |
Balance (in shares) | 85,503,321 | 88,312,068 | 42,720,067 |
Treasury stock | ' | ' | ' |
Increase (Decrease) in Stockholders' Equity | ' | ' | ' |
Repurchase of common shares | -29,907 | ' | ' |
Cancellation of common shares and treasury stock | 18,678 | ' | ' |
Reissuance of treasury stock for share based compensation | 11,229 | ' | ' |
Additional paid-in capital | ' | ' | ' |
Increase (Decrease) in Stockholders' Equity | ' | ' | ' |
Repurchase of common shares | -93 | ' | ' |
Cancellation of common shares and treasury stock | -18,674 | ' | ' |
Reissuance of treasury stock for share based compensation | -11,229 | ' | ' |
Issuance of common shares for share-based compensation | ' | 11 | ' |
Issuance of common share for business acquisition | 2,464 | 326,718 | ' |
Balance brought forward from VanceInfo as a result of the merger | ' | -11,407 | ' |
Share-based compensation | 23,000 | 11,125 | 5,656 |
Vesting of nonvested shares of a subsidiary | -1,363 | ' | ' |
Acquisition of non-controlling interest | -3,592 | -12,040 | ' |
Stock option exercise | 4,201 | 1,933 | 4,235 |
Disposal of variable interest entity | -71 | ' | ' |
Shares to be issued in connection with business acquisition | ' | ' | ' |
Increase (Decrease) in Stockholders' Equity | ' | ' | ' |
Issuance of common share for business acquisition | -2,464 | ' | ' |
Balance brought forward from VanceInfo as a result of the merger | ' | 619 | ' |
Shares issuable in connection with business acquisition | 3,430 | 918 | ' |
Accumulated other comprehensive income | ' | ' | ' |
Increase (Decrease) in Stockholders' Equity | ' | ' | ' |
Foreign currency translation adjustments | 5,846 | 2,453 | 5,738 |
Parent Company | ' | ' | ' |
Increase (Decrease) in Stockholders' Equity | ' | ' | ' |
Balance | 540,985 | 208,484 | 174,952 |
Balance (in shares) | 88,312,068 | ' | ' |
Repurchase of common shares | -30,000 | ' | ' |
Issuance of common shares for share-based compensation | ' | 14 | 2 |
Issuance of common share for business acquisition | ' | 326,778 | ' |
Balance brought forward from VanceInfo as a result of the merger | ' | -1,270 | ' |
Share-based compensation | 23,000 | 11,125 | 5,656 |
Vesting of nonvested shares of a subsidiary | -1,363 | ' | ' |
Acquisition of non-controlling interest | -3,592 | -12,040 | ' |
Stock option exercise | 4,201 | 1,933 | 4,235 |
Disposal of variable interest entity | -71 | ' | ' |
Shares issuable in connection with business acquisition | 3,430 | 918 | ' |
Net income | 7,837 | 2,590 | 17,901 |
Foreign currency translation adjustments | 5,846 | 2,453 | 5,738 |
Balance | 550,273 | 540,985 | 208,484 |
Balance (in shares) | 85,503,321 | 88,312,068 | ' |
Parent Company | Common shares | ' | ' | ' |
Increase (Decrease) in Stockholders' Equity | ' | ' | ' |
Balance | 123 | 60 | 58 |
Balance (in shares) | 88,312,068 | 42,720,067 | 41,536,412 |
Repurchase of common shares (in shares) | -4,643,359 | -1 | -2 |
Cancellation of common shares and treasury stock | -4 | ' | ' |
Cancellation of common shares and treasury stock (in shares) | -379,278 | ' | ' |
Reissuance of treasury stock for share based compensation (in shares) | 1,743,359 | ' | ' |
Issuance of common shares for share-based compensation | ' | 3 | 2 |
Issuance of common shares for share-based compensation (in shares) | ' | 2,150,814 | 1,075,406 |
Issuance of common share for business acquisition | ' | 60 | ' |
Issuance of common share for business acquisition (in shares) | 319,556 | 43,441,188 | ' |
Vesting of nonvested shares award (in shares) | 150,975 | ' | 108,251 |
Balance | 119 | 123 | 60 |
Balance (in shares) | 85,503,321 | 88,312,068 | 42,720,067 |
Parent Company | Treasury stock | ' | ' | ' |
Increase (Decrease) in Stockholders' Equity | ' | ' | ' |
Repurchase of common shares | -29,907 | ' | ' |
Cancellation of common shares and treasury stock | 18,678 | ' | ' |
Reissuance of treasury stock for share based compensation | 11,229 | ' | ' |
Parent Company | Additional paid-in capital | ' | ' | ' |
Increase (Decrease) in Stockholders' Equity | ' | ' | ' |
Balance | 502,748 | 186,408 | 176,517 |
Repurchase of common shares | -93 | ' | ' |
Cancellation of common shares and treasury stock | -18,674 | ' | ' |
Reissuance of treasury stock for share based compensation | -11,229 | ' | ' |
Issuance of common shares for share-based compensation | ' | 11 | ' |
Issuance of common share for business acquisition | 2,464 | 326,718 | ' |
Balance brought forward from VanceInfo as a result of the merger | ' | -11,407 | ' |
Share-based compensation | 23,000 | 11,125 | 5,656 |
Vesting of nonvested shares of a subsidiary | -1,363 | ' | ' |
Acquisition of non-controlling interest | -3,592 | -12,040 | ' |
Stock option exercise | 4,201 | 1,933 | 4,235 |
Disposal of variable interest entity | -71 | ' | ' |
Balance | 497,391 | 502,748 | 186,408 |
Parent Company | Shares to be issued in connection with business acquisition | ' | ' | ' |
Increase (Decrease) in Stockholders' Equity | ' | ' | ' |
Balance | 1,537 | ' | ' |
Issuance of common share for business acquisition | -2,464 | ' | ' |
Balance brought forward from VanceInfo as a result of the merger | ' | 619 | ' |
Shares issuable in connection with business acquisition | 3,430 | 918 | ' |
Balance | 2,503 | 1,537 | ' |
Parent Company | (Accumulated deficit) Retained earnings | ' | ' | ' |
Increase (Decrease) in Stockholders' Equity | ' | ' | ' |
Balance | 17,797 | 5,689 | -12,212 |
Balance brought forward from VanceInfo as a result of the merger | ' | 9,518 | ' |
Net income | 7,837 | 2,590 | 17,901 |
Balance | 25,634 | 17,797 | 5,689 |
Parent Company | Accumulated other comprehensive income | ' | ' | ' |
Increase (Decrease) in Stockholders' Equity | ' | ' | ' |
Balance | 18,780 | 16,327 | 10,589 |
Foreign currency translation adjustments | 5,846 | 2,453 | 5,738 |
Balance | $24,626 | $18,780 | $16,327 |
SCHEDULE_I_CONDENSED_FINANCIAL6
SCHEDULE I CONDENSED FINANCIAL INFORMATION OF PARENT COMPANY (Details 6) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Adjustments to reconcile net income to net cash provided by operating activities: | ' | ' | ' |
Equity in income of subsidiaries and VIE | ($68) | ($23) | ' |
Share-based compensation expenses | 22,858 | 11,064 | 5,656 |
Change in fair value of contingent consideration | -1,164 | -659 | 1,824 |
Changes in operating assets and liabilities, net of effects of business acquisitions: | ' | ' | ' |
Accrued expenses and other payables | 13,143 | 8,723 | 3,185 |
Net cash provided by operating activities | 60,832 | 36,325 | 24,323 |
Cash flows from investing activities: | ' | ' | ' |
Net cash used in investing activities | -8,058 | -5,764 | -38,374 |
Cash flows from financing activities: | ' | ' | ' |
Proceeds from issuance of common shares for share based compensation | 4,414 | 1,988 | 5,291 |
Deferred and contingent consideration paid for business acquisitions | -22,661 | -3,047 | -11,710 |
Repurchase of common shares | -30,000 | ' | ' |
Net cash used in financing activities | -48,247 | -1,536 | -45,646 |
Net (decrease) increase in cash and cash equivalents | 4,804 | 29,858 | -56,037 |
Cash and cash equivalents at beginning of year | 143,714 | 113,856 | 169,893 |
Cash and cash equivalents at end of year | 148,518 | 143,714 | 113,856 |
Parent Company | ' | ' | ' |
Cash flows from by operating activities: | ' | ' | ' |
Net income | 7,837 | 2,590 | 17,901 |
Adjustments to reconcile net income to net cash provided by operating activities: | ' | ' | ' |
Equity in income of subsidiaries and VIE | -33,401 | -25,513 | -25,026 |
Share-based compensation expenses | 22,858 | 11,064 | 5,656 |
Change in fair value of contingent consideration | -102 | -531 | 981 |
Changes in operating assets and liabilities, net of effects of business acquisitions: | ' | ' | ' |
Other long-term assets | ' | ' | 10 |
Intercompany receivables | 13,495 | 4,591 | 9,693 |
Other current assets | -578 | 110 | -11,574 |
Accrued expenses and other payables | 2,605 | 8,193 | ' |
Other current liabilities | ' | ' | -9,188 |
Net cash provided by operating activities | 12,714 | 504 | -11,547 |
Cash flows from investing activities: | ' | ' | ' |
Dividends received | ' | ' | 1,411 |
Investment income received from subsidiary | ' | 200 | ' |
Deferred and contingent consideration paid for business acquisitions | ' | -782 | ' |
Net cash used in investing activities | ' | -582 | 1,411 |
Cash flows from financing activities: | ' | ' | ' |
Repayment of short-term bank borrowings | ' | ' | -40,000 |
Proceeds from issuance of common shares for share based compensation | 4,414 | 1,988 | 5,291 |
Deferred and contingent consideration paid for business acquisitions | ' | ' | -4,014 |
Repurchase of common shares | -30,000 | ' | ' |
Net cash used in financing activities | -25,586 | 1,988 | -38,723 |
Net (decrease) increase in cash and cash equivalents | -12,872 | 1,910 | -48,859 |
Cash and cash equivalents at beginning of year | 28,972 | 27,062 | 75,921 |
Cash and cash equivalents at end of year | $16,100 | $28,972 | $27,062 |