Note 7 - Prepayments and Deposit to Suppliers

12 Months Ended

Dec. 31, 2014

Prepayments And Deposits To Suppliers Disclosure [Abstract]

Prepayments And Deposits To Suppliers Disclosure [Text Block]

7.   Prepayments and deposit to suppliers

	As of December 31,
	2014		2013
	US$(’000)		US$(’000)
Deposits to internet resources and TV advertisement providers		3,575		8,907
Prepayments to internet resources and TV advertisement providers		4,451		5,292
Other deposits and prepayments		66		493
		8,092		14,692

In order to provide advertising and marketing services, the Company partners with TV stations or its agents to obtain time slots for resale through broadcast advertisements to advertise brands, business information, products and services of its clients. The Company also purchases internet resources from large internet search engines to attract more internet traffic to its advertising portals and provide value-added services to its clients.

Deposits to TV advertisement and internet resources providers are paid as contractual deposits to the Company’s resources and services suppliers.

As of December 31, 2014, deposit to suppliers was primarily the contractual deposits of approximately US$3.1 million to two of the Company’s largest internet resources suppliers. The approximately US$8 million deposit for the purchasing of time slots in a TV station as of December 31, 2013 was transferred to other receivables account upon termination of cooperation with this TV station on December 31, 2014.

According to the contracts signed between the Company and its suppliers, the Company is normally required to pay the contract amounts in advance. These prepayments will be transferred to cost of sales when the related services are provided.

As of December 31, 2014, prepayment to suppliers consisted of approximately US$2.5 million prepayments to the Company’s internet resources suppliers and approximately US$2 million prepayment for the purchasing of TV time slots. This US$2 million advanced payment was carried forward from previous years and was paid to a TV station which had been partnered with the Company for over five years. In response to the restrictions on TV shopping infomercial implemented by the related government authorities, which resulted in the decrease in the Company’s TV advertisement revenue, the Company discussed with the TV station possible alternatives of applying the balance of the advanced payment, as the amount was unlikely to be refunded to the Company, due to internal administrative policies of the TV station. The TV station and the Company agreed that the unconsumed advanced payment balance can be consumed by any third parties designated by the Company and approved by the TV station, who will broadcast advertisements or other similar TV programs using the balance of available time slots, and the Company will directly collect the amounts from the third parties for the time slots they utilized. The Company expects that the remaining advanced payment balance will be fully utilized within the next twelve months or by December 31, 2015.