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ORGANIZATION (Tables)

12 Months Ended

Dec. 31, 2020

Significant Subsidiaries of Company and its Consolidated Variable Interest Entities

(a)

As of December 31, 2020, significant subsidiaries of the Company include the following entities:

Entity	Date of Incorporation/ Acquisition	Place of incorporation	Percentage of direct ownership by the Company		Principal activities
			2019	2020

Garena Online Private Limited (“Garena Online”)	May 8, 2009	Singapore	100	100	Game operations and software development

Shopee Limited (formerly known as Shopee Southeast Asia Limited)	January 16, 2015	Cayman Islands	100	100	Investment holding company

Shopee Singapore Private Limited	February 5, 2015	Singapore	100	100	Online platform

PT Shopee International Indonesia	August 5, 2015	Indonesia	100	100	Online platform

Financial Information of VIEs

The following tables represent the financial information of the VIEs whom the Company does not have majority voting interest as of December 31, 2019 and 2020 and for the years ended December 31, 2018, 2019 and 2020 before eliminating the intercompany balances and transactions between the VIEs and other entities within the group:

	As of December 31,
	2019 $		2020 $
ASSETS:
Current assets:
Cash and cash equivalents		111,831		94,502
Restricted cash		237,874		2,574
Accounts receivable, net		8,672		10,537
Prepaid expenses and other assets		25,586		40,822
Inventories, net		6,517		16,264
Short-term investments		30,324		9,287
Amounts due from related parties		286		–
Amounts due from intercompanies⁽¹⁾		34,432		44,928

Total current assets		455,522		218,914

Non-current assets:
Property and equipment, net		54,092		35,453
Operating lease right-of-use assets, net		27,637		25,265
Intangible assets, net		300		492
Long-term investments		13,961		16,080
Prepaid expenses and other assets		14,312		11,905
Deferred tax assets		32,903		47,948

Total non-current assets		143,205		137,143

Total assets		598,727		356,057

	As of December 31,
	2019 $		2020 $
LIABILITIES:
Current liabilities:
Accounts payable		11,274		16,183
Accrued expenses and other payables		93,146		91,186
Advances from customers		6,116		2,192
Amounts due to related parties		1,569		2,347
Short-term borrowings		1,258		–
Operating lease liabilities		8,797		9,787
Deferred revenue		133,362		212,377
Income tax payable		5,850		595
Amounts due to intercompanies⁽¹⁾		367,537		70,019

Total current liabilities		628,909		404,686

Non-current liabilities:
Accrued expenses and other payables		1,357		1,784
Long-term borrowings		358		–
Operating lease liabilities		20,129		16,527
Deferred revenue		49,325		55,200
Amounts due to intercompanies⁽¹⁾		12,980		15,710
Unrecognized tax benefits		976		107

Total non-current liabilities		85,125		89,328

Total liabilities		714,034		494,014

	For the Years Ended December 31,
	2018 $			2019 $			2020 $
Revenue
- Third party customers		342,800			443,401			562,347
- Intercompanies		52,325			118,833			145,848
Net loss		(67,816	)		(2,108	)		(30,435	)

	For the Years Ended December 31,
	2018 $			2019 $			2020 $
Net cash generated from (used in) operating activities		67,275			(77,708	)		134,060
Net cash used in investing activities		(27,434	)		(69,181	)		(27,399	)
Net cash generated from (used in) financing activities		97,398			199,406			(13,023	)

⁽¹⁾

Amounts due from or to intercompanies consist of intercompany receivables or payables to the other companies within the group arising from intercompany transactions, and funds advanced for working capital purpose.

- 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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