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
connection with
business acquisition
   
   
   
 
 
  Treasury
stock
  Additional
paid-in
capital
  (Accumulated
deficit) Retained earnings
  Accumulated
other comprehensive income
   
 
 
  Shares   Amount   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.