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INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2011

Income (Loss) Before Income Taxes

The Company had minimal operations in jurisdictions other than the PRC. Income (loss) before income taxes consists of:

		For the years ended December 31,
		2009				2010				2011				2011
		RMB				RMB				RMB				US$
		(In thousands)
PRC			1,907,575				4,321,910				8,217,522				1,305,632
Non-PRC			(224,454	)			(260,747	)			(408,343	)			(64,879	)
			1,683,121				4,061,163				7,809,179				1,240,753

Components of Income Tax

 Income taxes consist of:

		For the years ended December 31,
		2009				2010				2011				2011
		RMB				RMB				RMB				US$
		(In thousands)
Current income tax			222,778				616,994				1,328,970				211,152
Income tax refund due to reduced tax rate			(13,923	)			(6,625	)			(83,907	)			(13,331	)
Deferred income tax benefit			(62,308	)			(129,415	)			(131,146	)			(20,837	)
Valuation allowance			51,470				55,041				74,944				11,907
			198,017				535,995				1,188,861				188,891

Reconciliation of Tax Computed By Applying Respective Statutory Income Tax Rate to Effective Income Tax Rate

The reconciliation of tax computed by applying respective statutory income tax rate to pre-tax income is as follows (amounts in thousands of Renminbi (“RMB”), and in thousands of U.S. Dollars (“US$”), except for per share data):

		For the years ended December 31,
		2009				2010				2011				2011
		RMB				RMB				RMB				US$
Expected taxation at PRC EIT statutory rate			420,780				1,015,329				1,952,295				310,188
Effect of differing tax rates in different jurisdictions			5,101				8,416				43,260				6,873
Permanent differences – non-taxable income			(6,640	)			(733	)			(2,804	)			(445	)
Permanent differences – non-deductible expenses			9,001				10,935				9,989				1,588
Tax incentives relating to R&D expenditures			(9,125	)			(22,925	)			(105,966	)			(16,836	)
Effect of tax exemption and reduction inside PRC			(258,647	)			(533,802	)			(650,206	)			(103,307	)
Income tax refund due to reduced tax rate			(13,923	)			(6,625	)			(83,907	)			(13,331	)
Under-provided (over-accrued) EIT for previous years			—				10,359				(66,960	)			(10,639	)
Effect of tax rate change on deferred taxes			—				—				18,216				2,893
Addition to valuation allowance			51,470				55,041				74,944				11,907
Taxation for the year			198,017				535,995				1,188,861				188,891
Effective tax rate			11.76	%			13.20	%			15.22	%			15.22	%
Basic earnings per share for Class A and Class B ordinary shares effect of tax exemptions and reductions inside the PRC			7.48				15.34				18.64				2.96

Tax Effects of Temporary Differences that Give Rise to Deferred Tax Balances

The tax effects of temporary differences that give rise to the deferred tax balances at December 31, 2010 and 2011 are as follows:

			(254,919)				(254,919)				(254,919)
		December 31,
		2010				2011				2011
		RMB				RMB				US$
		(In thousands)
Provision for doubtful receivables			1,964				2,586				411
Fixed assets depreciation			41,089				36,274				5,763
Net operating loss carry-forward			173,644				248,790				39,529
Accrued expenses, payroll and others			80,592				140,805				22,372
Deferred tax assets			297,289				428,455				68,075
Valuation allowance			(179,959	)			(254,919	)			(40,503	)
Deferred tax assets, net			117,330				173,536				27,572

			(254,919)				(254,919)				(254,919)
		December 31,
		2010				2011				2011
		RMB				RMB				US$
		(In thousands)
Intangible assets arising from business combinations			—				131,629				20,914
Deferred tax liabilities			—				131,629				20,914

X

- Definition

Tabular disclosure of the components of income tax expense attributable to continuing operations for each year presented including, but not limited to: current tax expense (benefit), deferred tax expense (benefit), investment tax credits, government grants, the benefits of operating loss carryforwards, tax expense that results from allocating certain tax benefits either directly to contributed capital or to reduce goodwill or other noncurrent intangible assets of an acquired entity, adjustments of a deferred tax liability or asset for enacted changes in tax laws or rates or a change in the tax status of the entity, and adjustments of the beginning-of-the-year balances of a valuation allowance because of a change in circumstances that causes a change in judgment about the realizability of the related deferred tax asset in future years.

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Tabular disclosure of the components of net deferred tax asset or liability recognized in an entity's statement of financial position, including the following: the total of all deferred tax liabilities, the total of all deferred tax assets, the total valuation allowance recognized for deferred tax assets.

+ References

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- Definition

Tabular disclosure of the reconciliation using percentage or dollar amounts of the reported amount of income tax expense attributable to continuing operations for the year to the amount of income tax expense that would result from applying domestic federal statutory tax rates to pretax income from continuing operations.

+ References

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

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-Number

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Tabular disclosure of income before income tax between domestic and foreign jurisdictions.

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