other things, our own apportionment of deductible expenses which is subject to final confirmation by the relevant tax authorities upon settlement of the LAT. We only prepay a portion of such provisions each year as required by the local tax authorities. As of December 31, 2010, 2011 and 2012 and September 30, 2013, we made provisions for LAT in the amounts of RMB168.3 million, RMB150.7 million, RMB110.2 million and RMB48.4 million, respectively. As of the Latest Practicable Date, we had not received any official confirmation or exemption with respect to our LAT liabilities for any period despite our LAT prepayments during the years. We cannot assure you that the relevant tax authorities will agree with our calculation of LAT liabilities, nor can we assure you that the LAT provisions will be sufficient to cover our LAT obligations in respect of our past LAT liabilities. If the relevant tax authorities determine that our LAT liabilities exceed our LAT prepayments and provisions, and seek to collect that excess amount, our cash flow, results of operations and financial condition may be materially and adversely affected. In addition, as we continue to expand our property developments, we cannot assure you that our provision for LAT obligations based on our estimates in new markets will be sufficient to cover our actual LAT obligations. As there are uncertainties as to when the tax authorities will enforce the LAT collection and whether it will apply the LAT collection retrospectively to properties sold before the enforcement, any payment as a result of the enforcement of LAT collection may significantly restrict our cash flow position, our ability to finance our land acquisitions and to execute our business plans.

# Our future growth partly depends on our ability to develop our business in other regions of China where we currently have no operations

In order to achieve sustainable growth, we need to continue to seek development opportunities in select regions in the PRC with potential for growth where we have no existing operations. However, our experience as a property developer in our existing markets may not be applicable in other regions. We may face intense competition from developers with established experience or presence in these new markets, and from other developers with similar expansion plans. In addition, business expansion or land acquisition requires a significant amount of capital investment and human resources, and may divert our existing resources including the attention of our management. Additionally, we may not be able to hire, train or retain sufficient talent to manage our operations in the new markets. As a result, our inability to develop, manage and integrate new projects and businesses may adversely affect our operating efficiency and the success of our expansion plans, which consequently may adversely affect our business, financial conditions and future prospects.

# Increasing competition in the PRC, particularly from developers of properties similar to ours in the second- and third-tier cities where we operate, may adversely affect our business and financial condition

In recent years, a large number of property developers have undertaken property development and investment projects in second- and third-tier cities in China, including property developments similar to ours, with commercial and residential properties integrated to varying degrees. Our major competitors include large national and regional property developers and overseas developers, some of which may have better track records and greater financial and other resources than us. In addition, we also compete with small local property developers. Intense competition among property developers in second- and third-tier cities in China for land, financing, raw materials and skilled management and labor resources may result in increased cost for land acquisition and construction, an oversupply of properties available for sale and a decrease in property