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Fair value measurements (Tables)

12 Months Ended

Dec. 31, 2018

Fair Value Disclosures [Abstract]

Summary of liabilities measured at fair value on recurring basis

The following table summarizes the Company’s assets that are measured at fair value on a recurring basis and are categorized using the fair value hierarchy as of December 31, 2017 and December 31, 2018:

		As of December 31, 2017
		Level 1				Level 2				Level 3				Total
Assets
Short-term investments			29,570				94,980				-				124,550
Equity investment with readily determinable fair values			138,251				-				-				138,251
Available-for-sale debt securities			-				-				1,961				1,961
			167,821				94,980				1,961				264,762

		As of December 31, 2018
		Level 1				Level 2				Level 3				Total
Assets
Short-term investments (i)			78,605				900,448				-				979,053
Equity investment with readily determinable fair values (ii)			238,915				-				-				238,915
			317,520				900,448				-				1,217,968
Liabilities
Derivative liabilities (iii)			-				-				-				-

	(i)	Short-term investments represented the investments issued by commercial banks or other financial institutions with a variable interest rate indexed to the performance of underlying assets within one year. For the instruments whose fair value is provided by banks at the end of each period, the Company classifies the valuation techniques that use these inputs as Level 1 of fair value measurements. For the instruments whose fair value is estimated based on quoted prices of similar products provided by banks at the end of each period, the Company classifies the valuation techniques that use these inputs as Level 2 of fair value measurements.
	(ii)	Equity investments with readily determinable fair values are valued using the market approach based on the quoted prices in active markets at the reporting date. The Group classifies the valuation techniques that use these inputs as Level 1 of fair value measurements.
	(iii)	The Company has determined that conversion feature embedded in the Huya’s Series B-2 Preferred Shares is required to be bifurcated and accounted for as a derivative liability which would be measured at fair value (Note 24). Upon the completion of Huya’s IPO, the derivative liabilities were derecognized and the balance was transferred to additional paid-in capital accordingly.

Schedule of changes in level 3 instruments

The following table presents the changes in Level 3 liabilities for the year ended December 31, 2018.

		Conversion feature embedded in Series A Preferred Shares				Conversion feature embedded in Series B-2 Preferred Shares				Total
		RMB				RMB				RMB
Balance as of January 1, 2018			-				-				-
Initial recognition upon the extinguishment of Huya’s Series A Preferred Shares and the issuance of  Huya’s Series B-2 Preferred Shares as of March 8, 2018			572,237				320,097				892,334
Fair value loss on derivative liabilities			628,298				1,656,925				2,285,223
Foreign exchange			4,573				6,697				11,270
Derecognition of derivative liabilities upon the completion of Huya’s IPO			(1,205,108	)			(1,983,719	)			(3,188,827	)
Balance as of December 31, 2018			-				-				-

Schedule of Certain Significant Estimates

Such approach involves certain significant estimates which are as follows:

Valuation Date		March 8, 2018				May 10, 2018
Volatility			50	%			50	%
Risk-free rate (3 months)			1.66	%			1.58	%
Risk-free rate (4 years)			2.52	%			2.46	%
Dividend yield			0	%			0	%

X

- Definition

Tabular disclosure of financial instruments measured at fair value, including those classified in shareholders' equity measured on a recurring or nonrecurring basis. Disclosures include, but are not limited to, fair value measurements recorded and the reasons for the measurements, level within the fair value hierarchy in which the fair value measurements are categorized and transfers between levels 1 and 2. Nonrecurring fair value measurements are those that are required or permitted in the statement of financial position in particular circumstances.

+ References

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Tabular disclosure of liabilities, including [financial] instruments measured at fair value that are classified in stockholders' equity, if any, by class that are measured at fair value on a recurring basis. The disclosures contemplated herein include the fair value measurements at the reporting date by the level within the fair value hierarchy in which the fair value measurements in their entirety fall, segregating fair value measurements using quoted prices in active markets for identical assets (Level 1), significant other observable inputs (Level 2), and significant unobservable inputs (Level 3). Where the quoted price in an active market for the identical liability is not available, the Level 1 input is the quoted price of an identical liability when traded as an asset.

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