3. Nonmonetary transactions

In 2014, the Company entered into six advertising agreements with three human resources service providers, one bag manufacturing enterprise, one food company and one internet company, respectively, in 2014 to release the advertisements. The consideration of these contracts primarily consisted of professional recruitment and marketing services. According to management’s estimation, the fair value of the barter credits received was more clearly evident than the fair value of the barter transaction. For the year ended December 31, 2014, the Company recognized advertising issuance revenue of $175 generated from barter transactions and expensed barter credits received of $186. There was no gain or loss recognized on the transfer.

The Company entered into three barter transactions in 2013.

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Barter transaction I. The Company entered into an advertising agreement with a shoe manufacturing enterprise to release the advertisement of its products in 42 LCD screens for two months with the frequency of 120 times a day. The consideration of the contract is the barter credits – 1,077 sheets of coupons for Spring & Summer shoes with the average market unit price of RMB 2,150 and 375 sheets for Autumn & Winter shoes with the average unit price of RMB 2,650. According to management’s estimation, the realized fair value of the barter credits received is more clearly evident than the fair value of the barter transaction. The sale arrangement was valued at $534. The Company recognized advertisement issuance revenue of $504 and capitalized barter credits received of $542 for the year ended December 31, 2013, and there was no financial impact for the year ended December 31, 2014. There was no gain or loss recognized on the transfer.

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Barter transaction II. In August 2013, the Company appointed a local communication company (the “Communication Company”) for the approval service of an additional 54 LCD advertising locations concession. The contract term was three years and the total amount was $492. As the settlement of this obligation, the Company and the Communication Company reached an agreement that the contract amount would be offset by part of the barter credits obtained from the sale described in “Barter Transaction I”. According to management’s estimation, the fair value of the barter credits were more clearly evident than the fair value of the barter transaction. The cost of the approval service was determined at $492. The Company settled the obligation incurred by concession approval of $492 and capitalized approval costs of $492. In 2014 and 2013, the Company amortized $169 and $58 to cost of revenue. The outstanding concession approval fee was $265 and $434 as of December 31, 2014 and 2013, respectively. There was no gain or loss recognized on the transfer.

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Barter transaction III. The Company entered into an agreement to release the advertisement in 99 LCD screens in 20 malls for two months with the frequency of 360 times a day. The contract amount was $492 and the consideration of the contract was the 5-year use right of a LED advertising screen, with the size of 3.42m*2.32m located just in front of Nanjing West Road entrance. According to management’s estimation, the market price of advertising time and spaces surrendered was more clearly evident than the fair value of the barter transaction. The exchange was valued at $492. In 2013, the Company recognized advertising service revenue $457 and amortized one month LED use right with the amount of $8 to cost of revenue. In 2014, the Company amortized the LED use right with the amount of $98 to the cost of revenue, and the outstanding balance was $386 and $484 as of December 31, 2014 and 2013, respectively. There was no gain or loss recognized on the transfer.