ORGANIZATION AND PRINCIPAL ACTIVITIES (Tables)

12 Months Ended

Dec. 31, 2014

ORGANIZATION AND PRINCIPAL ACTIVITIES

Schedule of subsidiaries and consolidated VIEs of the Company

The subsidiaries and consolidated VIEs of the Company as of December 31, 2014 are as follows:

Name of subsidiaries and consolidated VIEs	Percentage of ownership			Date of incorporation or combination		Place of incorporation
Taomee Holdings (HK) Limited ("Taomee Hong Kong")		100	%		November 27, 2008	Hong Kong
Shanghai Shengran Information Technology Co., Ltd. ("Shanghai Shengran")		100	%		June 12, 2009	PRC
Shanghai Taomee Network Technology Co., Ltd. ("Shanghai Taomee")		VIE			October 8, 2007	PRC
Shanghai Qidong Information Technology Co., Ltd. ("Shanghai Qidong")		VIE			March 4, 2009	PRC
Shanghai Taomee Animation Co., Ltd. ("Shanghai Animation")		VIE			November 11, 2010	PRC
Guangdong Taomee Animation Technology Co., Ltd. ("Guangdong Taomee")		VIE			June 1, 2012	PRC
Shanghai Xinsheng Information Technology Co., Ltd. ("Shanghai Xinsheng")		93	%		October 31, 2012	PRC
Shanghai Taomee Wireless Technology Co., Ltd. ("Shanghai Wireless")		99	%		May 6, 2013	PRC
Shanghai Taomee Software Development Co., Ltd. ("Shanghai Software")		99	%		October 29, 2013	PRC
Shanghai Taomee Property Service Co., Ltd. ("Shanghai Property Service")		99	%		November 1, 2013	PRC
Shanghai Jushou Wireless Technology Co., Ltd. ("Shanghai Jushou")		VIE			July 3, 2014	PRC

Summary of financial information of the Group's VIEs included in the accompanying consolidated financial statements (after eliminating all intercompany transactions and balances, except for cash flow information which was before eliminating intercompany transactions and balances)

	December 31,
	2013		2014
Assets
Current assets:
Cash and cash equivalents		12,216,436		9,449,326
Accounts receivable, net		1,849,786		1,243,350
Inventory		196,757		238,055
Income tax recoverable		585,861		219,374
Due from related party		2,169,866		2,575,248
Prepayments and other current assets		1,614,931		1,276,264
Deferred tax assets—current		3,489,805		4,004,672

Total current assets		22,123,442		19,006,289
Investment in equity investees		2,326,793		6,183,197
Property and equipment, net		1,163,086		1,160,380
Acquired intangible asset		1,030,702		730,152
Other assets		376,926		947,525

Total assets		27,020,949		28,027,543


Liabilities
Accounts payable		1,538,665		730,535
Due to related parties		22,957		163,748
Advance from customers		6,184,953		5,860,035
Deferred revenue		12,340,821		11,768,665
Accrued expenses and other current liabilities		1,680,767		1,452,119
Deferred tax liabilities—current		1,758,134		386,092

Total liabilities		23,526,297		20,361,194

	For the year ended December 31,
	2012		2013		2014
Net revenues	$	33,535,368	$	40,985,710	$	35,363,951


Net income	$	20,773,883	$	21,586,325	$	18,979,696

	For the year ended December 31,
	2012			2013			2014
Net cash provided by (used in) operating activities		(1,468,141	)		1,741,060			1,250,010


Net cash used in investing activities		(318,549	)		(4,991,080	)		(4,044,290	)


Net cash provided by financing activities		78,979			—			27,170


Net decrease in cash and cash equivalent		(1,707,711	)		(3,250,020	)		(2,767,110	)

- Definition

Tabular disclosure of the significant judgments and assumptions made in determining whether a variable interest (as defined) held by the entity requires the variable interest entity (VIE) (as defined) to be consolidated and (or) disclose information about its involvement with the VIE, individually or in aggregate (as applicable); the nature of restrictions, if any, on the consolidated VIE's assets and on the settlement of its liabilities reported by an entity in its statement of financial position, including the carrying amounts of such assets and liabilities; the nature of, and changes in, the risks associated with involvement in the VIE; how involvement with the VIE affects the entity's financial position, financial performance, and cash flows; the lack of recourse if creditors (or beneficial interest holders) of the consolidated VIE have no recourse to the general credit of the primary beneficiary (if applicable); the terms of arrangements, giving consideration to both explicit arrangements and implicit variable interests, if any, that could require the entity to provide financial support to the VIE, including events or circumstances that could expose the entity to a loss; the methodology used by the entity for determining whether or not it is the primary beneficiary of the variable interest entity; the significant factors considered and judgments made in determining that the power to direct the activities of a VIE that most significantly impact the VIE's economic performance are shared (as defined); the carrying amounts and classification of assets and liabilities of the VIE included in the statement of financial position; the entity's maximum exposure to loss, if any, as a result of its involvement with the VIE, including how the maximum exposure is determined and significant sources of the entity's exposure to the VIE; a comparison of the carrying amounts of the assets and liabilities and the entity's maximum exposure to loss; information about any liquidity arrangements, guarantees, and (or) other commitments by third parties that may affect the fair value or risk of the entity's variable interest in the VIE; whether or not the entity has provided financial support or other support (explicitly or implicitly) to the VIE that it was not previously contractually required to provide or whether the entity intends to provide that support, including the type and amount of the support and the primary reasons for providing the support; and supplemental information the entity determines necessary to provide.

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