Directors' Report - Alibaba

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NOTES TO THE FINANCIAL STATEMENTS For the year ended December 31, 2010 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 2.1 Basis of preparation The consolidated financial statements of the Group have been prepared in accordance with International Financial Reporting Standards (“IFRS”) issued by the International Accounting Standards Board and have been prepared under the historical cost convention, as modified by the revaluation of available-for-sale investments. The preparation of the financial statements in conformity with IFRS requires the use of certain critical accounting estimates. It also requires management to exercise its judgment in the process of applying the Group’s accounting policies. Those areas involving a higher degree of judgment or complexity, or areas where assumptions and estimates are significant to the Group’s consolidated financial statements are disclosed in Note 3. Actual results may differ from these estimates. The Group has early adopted IFRS 3 (Revised), IAS 27 (Revised), IFRIC 17, Amendment to IAS 38 and Amendment to IFRS 2 in 2009. The Group has adopted the following new/revised IFRS standards and interpretations for accounting periods commencing January 1, 2010: Alibaba.com Limited Annual Report 2010 92 Effective for annual periods beginning on or after IFRSs (Amendments) Improvements to IFRSs January 1, 2010 Amendment to IAS 1 Presentation of Financial Statements January 1, 2010 Amendment to IAS 7 Statement of Cash Flows January 1, 2010 Amendment to IAS 17 Leases January 1, 2010 Amendment to IAS 36 Impairment of Assets January 1, 2010 Amendment to IAS 39 Financial instruments: Recognition and Measurement January 1, 2010 Amendment to IFRS 2 Group Cash-settled Share-based Payment Transactions January 1, 2010 Amendment to IFRS 8 Operating Segments January 1, 2010 The adoption of the above new/revised IFRS standards and interpretations do not have any material impact on the Group’s consolidated financial statements and has not led to any changes in the Group’s accounting policies. The following new standards, interpretations and amendments to the existing standards have been published but have not come into effect for the financial year beginning January 1, 2010: Effective for annual periods beginning on or after Amendment to IAS 32 Financial Instruments: Presentation on Classification of Rights Issues February 1, 2010 IFRIC 19 Extinguishing Financial Liabilities with Equity Instruments July 1, 2010 IFRSs (Amendments) Improvements to IFRSs 2010 January 1, 2011 Amendment to IAS 24 Related Party Disclosures January 1, 2011 Amendment to IFRIC 14 Pre-payments of a Minimum Funding Requirement January 1, 2011 IFRS 9 Financial Instruments January 1, 2013
2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) 2.1 Basis of preparation (Continued) The Group has not early adopted any of the above new standards, interpretations and amendments to the existing standards in 2010. Management is in the process of making an assessment of their impact and is not yet in a position to state whether any substantial changes to the Group’s significant accounting policies and presentation of the financial information will be resulted. 2.2 Consolidation The consolidated financial statements of the Group incorporate the financial statements of the Company and of all its direct and indirect subsidiaries made up to December 31 and include the Group’s interests in associated companies and a jointly controlled entity. Results of the subsidiaries, associated companies and the jointly controlled entity acquired or disposed of during the year are dealt with in the consolidated statement of comprehensive income from the effective dates of acquisition and up to the effective dates of disposal respectively. Inter-company transactions, balances and unrealized gains on transactions between the consolidated entities or businesses are eliminated. Unrealized losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred. Accounting policies of subsidiaries, associated companies and the jointly controlled entity have been changed where necessary to ensure consistency with the policies adopted by the Group. (a) Subsidiaries Subsidiaries are all entities (including special purpose entities) over which the Group has the power to govern the financial and operating policies generally accompanying a shareholding of more than one-half of the voting rights. The existence and effect of potential voting rights that are currently exercisable or convertible are considered when assessing whether the Group controls another entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are de-consolidated from the date that control ceases. The acquisition method of accounting is used to account for the acquisitions of subsidiaries of the Group, except for those acquisitions which are considered as a business combination under common control in a manner similar to pooling-of-interests and with reference to the principles of merger accounting under Hong Kong Accounting Guideline 5 “Merger Accounting for Common Control Combinations”. (i) Acquisition method of accounting The acquisition method of accounting is used to account for business combinations by the Group. The consideration transferred for the acquisition of a subsidiary is the fair values of the assets transferred, the liabilities incurred and the equity interests issued by the Group. The consideration transferred includes the fair value of any asset or liability resulting from a contingent consideration arrangement. Acquisition-related costs are expensed as incurred. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. On an acquisition-byacquisition basis, the Group recognizes any non-controlling interests in the acquiree either at fair value or at the non-controlling interests’ proportionate share of the acquiree’s net assets. 93 Alibaba.com Limited Annual Report 2010
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02 Financial and Operational Highli
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FINANCIAL HIGHLIGHTS Total register
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SEPTEMBER AUGUST Organized a big bu
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Award / Recognition Awarding Organi
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LEGAL ADVISERS Freshfields Bruckhau
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In closing, a word about the import
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A WINDOW ON THE GLOBAL MARKET MANAG
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were officially launched in the sec
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At the end of September 2010, we an
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Trust and safety With tens of milli
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Financial performance summary Reven
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Revenue from our international mark
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Product development expenses Our pr
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Profit attributable to equity owner
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In 2010, our capital expenditures d
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OUTLOOK Looking ahead to 2011, we f
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PENG Yi Jie, Sabrina TSAI Chung, Jo
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more than 30 years of global manage
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CULTURE DEVELOPMENT Alibaba.com has
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WE TRULY BELIEVE THAT SOCIAL RESPON
Page 43 and 44: GROWING A GREENER COMMUNITY
Page 45 and 46: Composition and attendance Director
Page 47 and 48: Key principle/practice CP/RBP Note
Page 59 and 60: We firmly believe that a sound cont
Page 61 and 62: Upholding Alibaba values is somethi
Page 63 and 64: RESERVES Details of movements in th
Page 65 and 66: Note (continued): (2) These securit
Page 68 and 69: DIRECTORS’ REPORT SHARE-BASED INC
Page 70 and 71: DIRECTORS’ REPORT (ii) Participan
Page 72 and 73: DIRECTORS’ REPORT (b) Particulars
Page 74: DIRECTORS’ REPORT DIRECTORS’ IN
Page 77 and 78: We have also engaged our auditors t
Page 79 and 80: Under the New Cooperation Framework
Page 81 and 82: Unless the parties otherwise agree
Page 83: PURCHASE, SALE OR REDEMPTION OF THE
Page 86 and 87: CONSOLIDATED BALANCE SHEET As of De
Page 88 and 89: BALANCE SHEET As of December 31, 20
Page 90 and 91: CONSOLIDATED STATEMENT OF CHANGES I
Page 92 and 93: CONSOLIDATED CASH FLOw STATEMENT Fo
Page 96 and 97: NOTES TO THE FINANCIAL STATEMENTS F
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NOTES TO THE FINANCIAL STATEMENTS F
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FINANCIAL SUMMARY CONSOLIDATED INCO
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Directors' Report - Alibaba

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