##### 



EXHIBIT 15.3
  
 China Real Estate Information Corporation
 INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
 Report of Independent Registered Public Accounting Firm
    
    
    F-2Consolidated Balance Sheets as of December 31, 2008 and 2009
    
    
    F-3Consolidated Statements of Operations for the Years Ended December 31, 2007, 2008 and 2009
    
    
    F-4Consolidated Statements of Changes in Equity and Comprehensive Income for the Years Ended
December 31, 2007, 2008, and 2009
    
    
    F-5Consolidated Statements of Cash Flows for the Years Ended December 31, 2007, 2008 and 2009
    
    
    F-6Notes to Consolidated Financial Statements for the Years Ended December 31,2007,2008 and 2009
    
    
    F-7Appendix 1  Entities included in the consolidated financial statements
    
    
    F-33




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##### Table of Contents



Report of Independent Registered Public Accounting Firm
 
      
  F- 2




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##### Table of Contents



China Real Estate Information Corporation
 
 Consolidated Balance Sheets
 (In U.S. dollar except for share data)
 December 31,2008
    
    
    2009$
    
    
    $AssetsCurrent assets:Cash and cash equivalents
    
    
    25,791,238
    
    
    
    311,066,566Unbilled accounts receivable, net of
allowance for doubtful accounts of nil
and $5,625,089 at December 31, 2008 and
2009, respectively
    
    
    10,767,049
    
    
    
    22,739,129Accounts receivable, net of allowance for
doubtful accounts of nil and nil at
December 31, 2008 and 2009, respectively
    
    
    13,168,789
    
    
    
    5,690,968Advance payment for advertising placement
    
    
    1,803,980
    
    
    
    1,400,862Advance payment for properties
    
    
    
    
    
    
    8,108,299Prepaid expenses and other current assets
    
    
    5,810,274
    
    
    
    5,589,534Amounts due from related parties
    
    
    
    
    
    
    2,460,572Total current assets
    
    
    57,341,330
    
    
    
    357,055,930Property and equipment, net
    
    
    2,521,190
    
    
    
    7,422,583Intangible assets, net
    
    
    1,529,322
    
    
    
    201,138,891Goodwill
    
    
    4,269,149
    
    
    
    449,902,711Investment in affiliates
    
    
    5,062,394
    
    
    
    Advance payment for advertising placement
    
    
    4,927,059
    
    
    
    Advance payment for properties
    
    
    7,791,586
    
    
    
    Other non-current assets
    
    
    309,103
    
    
    
    4,570,964Total assets
    
    
    83,751,133
    
    
    
    1,020,091,079Liabilities and EquityCurrent liabilities:Accounts payable
    
    
    510,489
    
    
    
    2,288,650Advance from customers
    
    
    440,889
    
    
    
    2,855,165Accrued payroll and welfare expenses
    
    
    992,263
    
    
    
    3,873,160Income tax payable
    
    
    3,877,645
    
    
    
    9,270,321Other tax payable
    
    
    775,842
    
    
    
    3,085,419Amounts due to related parties
    
    
    5,472,859
    
    
    
    7,300,568Payable for acquisition of subsidiary
    
    
    1,319,976
    
    
    
    Deposit for property for sale
    
    
    
    
    
    
    2,781,378Other current liabilities
    
    
    1,536,591
    
    
    
    4,183,746Total current liabilities
    
    
    14,926,554
    
    
    
    35,638,407Deferred
revenue, non-current
    
    
    1,975,155
    
    
    
    Deferred tax
liabilities, non-current
    
    
    338,259
    
    
    
    42,031,640Total liabilities
    
    
    17,239,968
    
    
    
    77,670,047Commitments and contingencies (Note 14)Equity:Ordinary
shares ($0.0002 par value): 250,000,000 shares authorized, 71,522,222
and 142,922,222 shares issued and
outstanding as of December 31, 2008 and
2009, respectively
    
    
    14,304
    
    
    
    28,584Additional paid-in capital
    
    
    40,991,770
    
    
    
    863,169,196Retained earnings
    
    
    20,956,173
    
    
    
    74,385,774Accumulated other comprehensive income
    
    
    3,707,854
    
    
    
    3,629,398Subscription receivables
    
    
    (14,304
    )
    
    
    Total CRIC equity
    
    
    65,655,797
    
    
    
    941,212,952Non-controlling interests
    
    
    855,368
    
    
    
    1,208,080Total equity
    
    
    66,511,165
    
    
    
    942,421,032Total liabilities and equity
    
    
    83,751,133
    
    
    
    1,020,091,079
   F- 3




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##### Table of Contents



China Real Estate Information Corporation
 
 Consolidated Statements of Operations
 (In U.S. dollar except for share data)
 Years Ended December 31,2007
    
    
    2008
    
    
    2009$
    
    
    $
    
    
    $Total revenues
    
    
    8,195,165
    
    
    
    50,048,530
    
    
    
    95,653,810Cost of revenues
    
    
    (895,405
    )
    
    
    (2,897,247
    )
    
    
    (12,810,162
    )Selling, general and administrative expenses
    
    
    (4,985,048
    )
    
    
    (19,819,873
    )
    
    
    (48,048,529
    )Gain from settlement of pre-existing relationship
    
    
    
    
    
    
    
    
    
    
    2,100,832Income from operations
    
    
    2,314,712
    
    
    
    27,331,410
    
    
    
    36,895,951Other income (expense):Interest income
    
    
    192,961
    
    
    
    420,517
    
    
    
    279,079Other income (expense), net
    
    
    (156,825
    )
    
    
    (1,341,165
    )
    
    
    2,725,032Income before taxes and equity in affiliates
    
    
    2,350,848
    
    
    
    26,410,762
    
    
    
    39,900,062Income tax expense
    
    
    (284,999
    )
    
    
    (4,721,015
    )
    
    
    (6,306,613
    )Income before equity in affiliates
    
    
    2,065,849
    
    
    
    21,689,747
    
    
    
    33,593,449Income from equity in affiliates
    
    
    
    
    
    
    153,700
    
    
    
    22,015,607Net income
    
    
    2,065,849
    
    
    
    21,843,447
    
    
    
    55,609,056Less: Net income (loss) attributable to non-controlling interests
    
    
    
    
    
    
    (318,214
    )
    
    
    6,765Net income
attributable to CRIC shareholders
    
    
    2,065,849
    
    
    
    22,161,661
    
    
    
    55,602,291Earnings per share:Basic
    
    $
    0.03
    
    
    $
    0.31
    
    
    $
    0.64Diluted
    
    $
    0.03
    
    
    $
    0.31
    
    
    $
    0.63Shares used in computation:Basic
    
    
    71,522,222
    
    
    
    71,522,222
    
    
    
    86,610,265Diluted
    
    
    71,522,222
    
    
    
    71,522,222
    
    
    
    88,264,301
   F- 4




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##### Table of Contents



China Real Estate Information Corporation
 
 Consolidated Statements of Changes in Equity
 and Comprehensive Income
 (In U.S. dollar)
 Retained
    
    
    AccumulatedAdditional
    
    
    Earnings
    
    
    Other
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    TotalOrdinary
    
    
    Paid-in
    
    
    (Accumulated
    
    
    Comprehensive
    
    
    Subscription
    
    
    Non-controlling
    
    
    Total
    
    
    ComprehensiveShares
    
    
    Capital
    
    
    Deficit)
    
    
    Income
    
    
    Receivables
    
    
    Interests
    
    
    Equity
    
    
    IncomeNumber
    
    
    $
    
    
    $
    
    
    $
    
    
    $
    
    
    $
    
    
    $
    
    
    $
    
    
    $Balance at January
1, 2007
    
    
    71,522,222
    
    
    
    14,304
    
    
    
    5,000,000
    
    
    
    1,072,510
    
    
    
    47,452
    
    
    
    (14,304
    )
    
    
    
    
    
    
    6,119,962Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,065,849
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,065,849
    
    
    
    2,065,849Cash contribution
from E-House
    
    
    
    
    
    
    
    
    
    
    25,000,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    25,000,000
    
    
    
    Distribution to
E-House
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (4,343,847
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (4,343,847
    )
    
    
    Foreign currency
translation
adjustments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    876,049
    
    
    
    
    
    
    
    
    
    
    
    876,049
    
    
    
    876,049Balance at December
31, 2007
    
    
    71,522,222
    
    
    
    14,304
    
    
    
    30,000,000
    
    
    
    (1,205,488
    )
    
    
    923,501
    
    
    
    (14,304
    )
    
    
    
    
    
    
    29,718,013
    
    
    
    2,941,898Capital
contribution by
non-controlling
interest
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,173,582
    
    
    
    1,173,582
    
    
    
    Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    22,161,661
    
    
    
    
    
    
    
    
    
    
    
    (318,214
    )
    
    
    21,843,447
    
    
    
    21,843,447Contribution from
E-House
    
    
    
    
    
    
    
    
    
    
    2,591,770
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,591,770
    
    
    
    Cash contribution
from E-House
    
    
    
    
    
    
    
    
    
    
    8,400,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    8,400,000
    
    
    
    Foreign currency
translation
adjustments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,784,353
    
    
    
    
    
    
    
    
    
    
    
    2,784,353
    
    
    
    2,784,353Balance at December
31, 2008
    
    
    71,522,222
    
    
    
    14,304
    
    
    
    40,991,770
    
    
    
    20,956,173
    
    
    
    3,707,854
    
    
    
    (14,304
    )
    
    
    855,368
    
    
    
    66,511,165
    
    
    
    24,627,800Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    55,602,291
    
    
    
    
    
    
    
    
    
    
    
    6,765
    
    
    
    55,609,056
    
    
    
    55,609,056Capital
contribution and
non-controlling
interest recognized
in connection with
business
acquisition
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,260,780
    
    
    
    1,260,780
    
    
    
    Collection of
subscription
receivables
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    10,000
    
    
    
    
    
    
    
    10,000
    
    
    
    Distribution to
E-House
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,001,304
    )
    
    
    
    
    
    
    4,304
    
    
    
    
    
    
    
    (997,000
    )
    
    
    Cash contribution
from E-House
    
    
    
    
    
    
    
    
    
    
    2,499,977
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,499,977
    
    
    
    Replacement of COHT
share options
    
    
    
    
    
    
    
    
    
    
    14,960,796
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    14,960,796
    
    
    
    Share-based
compensation
    
    
    
    
    
    
    
    
    
    
    7,123,911
    
    
    
    (1,171,386
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,952,525
    
    
    
    Issuance of
ordinary shares to
public, net of
issuance cost
    
    
    20,700,000
    
    
    
    4,140
    
    
    
    224,700,460
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    224,704,600
    
    
    
    Issuance of
ordinary shares in
connection with
business
acquisition
    
    
    47,666,667
    
    
    
    9,533
    
    
    
    571,990,471
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    572,000,004
    
    
    
    Issuance of
ordinary shares in
exchange for a
non-controlling
interest
    
    
    3,033,333
    
    
    
    607
    
    
    
    901,811
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (902,418
    )
    
    
    
    
    
    
    Foreign currency
translation
adjustments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (78,456
    )
    
    
    
    
    
    
    (12,415
    )
    
    
    (90,871
    )
    
    
    (90,871
    )Balance at December
31, 2009
    
    
    142,922,222
    
    
    
    28,584
    
    
    
    863,169,196
    
    
    
    74,385,774
    
    
    
    3,629,398
    
    
    
    
    
    
    
    1,208,080
    
    
    
    942,421,032
    
    
    
    55,518,185
   F- 5




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##### Table of Contents



China Real Estate Information Corporation
 
 Consolidated Statements of Cash Flows
 (In U.S. dollar)
 Years Ended December 31,2007
    
    
    2008
    
    
    2009$
    
    
    $
    
    
    $Operating activities:Net income
    
    
    2,065,849
    
    
    
    21,843,447
    
    
    
    55,609,056Adjustments to reconcile net income to net cash (used in) provided by operating activities:Depreciation and amortization
    
    
    60,577
    
    
    
    440,613
    
    
    
    6,744,120Allowance for doubtful accounts
    
    
    
    
    
    
    
    
    
    
    4,722,707Gain from settlement of pre-existing relationship
    
    
    
    
    
    
    
    
    
    
    (2,100,832
    )Income from investment in affiliates
    
    
    
    
    
    
    (153,700
    )
    
    
    (22,015,607
    )Share-based compensation
    
    
    
    
    
    
    
    
    
    
    5,952,525Others
    
    
    
    
    
    
    
    
    
    
    83,842Changes in operating assets and liabilitiesAccounts receivable
    
    
    1,046,519
    
    
    
    (21,746,362
    )
    
    
    3,960,246Amounts due from related parties
    
    
    (4,442,415
    )
    
    
    2,690,338
    
    
    
    (2,432,415
    )Advance payment for advertising placement
    
    
    
    
    
    
    (6,731,039
    )
    
    
    5,330,177Prepaid expenses and other current assets
    
    
    (89,135
    )
    
    
    (4,718,931
    )
    
    
    3,180,592Other non-current assets
    
    
    
    
    
    
    (4,336
    )
    
    
    (22,589
    )Accounts payable
    
    
    32,172
    
    
    
    387,544
    
    
    
    1,664,048Accrued payroll and welfare expenses
    
    
    167,350
    
    
    
    718,993
    
    
    
    2,629,806Income tax payable
    
    
    152,175
    
    
    
    3,182,709
    
    
    
    5,262,213Other tax payable
    
    
    54,535
    
    
    
    642,958
    
    
    
    2,309,203Amounts due to related parties
    
    
    
    
    
    
    
    
    
    
    (6,186,987
    )Other current liabilities
    
    
    64,097
    
    
    
    (512,730
    )
    
    
    (7,036,553
    )Advance from customers
    
    
    (91,449
    )
    
    
    839,354
    
    
    
    2,414,276Deferred tax
    
    
    (250,124
    )
    
    
    (124,654
    )
    
    
    (3,054,613
    )Net cash (used in) provided by operating activities
    
    
    (1,229,849
    )
    
    
    (3,245,796
    )
    
    
    57,013,215Investing activities:Deposit for and purchase of property and equipment
    
    
    (368,575
    )
    
    
    (9,478,138
    )
    
    
    (2,378,033
    )Purchase of subsidiaries, net of cash acquired
    
    
    
    
    
    
    (2,399,326
    )
    
    
    3,243,114Investment in affiliates
    
    
    
    
    
    
    (2,500,000
    )
    
    
    Proceeds from disposal of property and equipment
    
    
    
    
    
    
    18,645
    
    
    
    225,444Deposit and proceeds for property for sale
    
    
    
    
    
    
    
    
    
    
    3,042,015Collection of loans from related parties
    
    
    964,513
    
    
    
    2,157,683
    
    
    
    Net cash provided by (used in) investing activities
    
    
    595,938
    
    
    
    (12,201,136
    )
    
    
    4,132,540Financing activities:Contribution from non-controlling interests
    
    
    
    
    
    
    270
    
    
    
    1,175,244Proceeds of loans (repayment of loans) from related parties
    
    
    
    
    
    
    5,696,838
    
    
    
    (5,616,633
    )Collection of subscription receivables
    
    
    
    
    
    
    
    
    
    
    10,000Advance from a related party
    
    
    
    
    
    
    
    
    
    
    1,050,000Proceeds from issuance of ordinary shares, net of paid issuance costs of $23,548,949
    
    
    
    
    
    
    
    
    
    
    224,851,051Contribution from E-House
    
    
    25,000,000
    
    
    
    8,400,000
    
    
    
    2,499,977Net cash provided by financing activities
    
    
    25,000,000
    
    
    
    14,097,108
    
    
    
    223,969,639Effect of exchange rate changes
    
    
    586,293
    
    
    
    729,589
    
    
    
    159,934Net increase in cash and cash equivalents
    
    
    24,952,382
    
    
    
    (620,235
    )
    
    
    285,275,328Cash and cash equivalents at the beginning of the year
    
    
    1,459,091
    
    
    
    26,411,473
    
    
    
    25,791,238Cash and cash equivalents at the end of the year
    
    
    26,411,473
    
    
    
    25,791,238
    
    
    
    311,066,566Supplemental disclosure of cash flow information:Income taxes paid
    
    
    
    
    
    
    1,446,702
    
    
    
    3,379,554Non-cash investing and financing activities:Related party loans converted to equity
    
    
    25,000,000
    
    
    
    8,400,000
    
    
    
    2,499,977Related party receivable paid as dividend or (payable recorded as a capital contribution)
    
    
    4,343,847
    
    
    
    (2,591,770
    )
    
    
    997,000Issuance of ordinary shares in connection with business acquisition
    
    
    
    
    
    
    
    
    
    
    572,000,004Ordinary share issuance costs in payables
    
    
    
    
    
    
    
    
    
    
    146,451Replacement of share options due to acquisition
    
    
    
    
    
    
    
    
    
    
    14,960,796Non-controlling interest recognized in connection with business acquisition
    
    
    
    
    
    
    
    
    
    
    85,536
   F- 6




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##### Table of Contents



China Real Estate Information Corporation
 
 Notes to Consolidated Financial Statements
 For the Years Ended December 31, 2007, 2008 and 2009
 (In U.S. dollar)
 1. Organization and Principal Activities
           F- 7




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##### Table of Contents



2. Summary of Principal Accounting Policies
 (a) Basis of presentation
  (b) Basis of consolidation
       F- 8




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##### Table of Contents



As of December 31, 2009$Total assets
    
    
    15,367,010Total liabilities
    
    
    13,584,892
   As of December 31, 2009$Total assets
    
    
    4,697,532Total liabilities
    
    
    6,703,036
  F- 9




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##### Table of Contents



(c) Use of estimates
  (d) Fair value of financial instruments
        (e) Business combinations
  (f) Cash and cash equivalents
  (g) Unbilled accounts receivable
   F- 10




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##### Table of Contents



(h) Advance payment for advertising placement
  (i) Advance payment for properties
  (j) Investment in affiliates
  (k) Property and equipment, net
  Leasehold improvements
    
    Over the shorter of the lease term or their estimated useful livesFurniture, fixtures and equipment
    
    5 yearsMotor vehicles
    
    5 years
  (l) Intangible assets, net
  (m) Internally developed software
  (n) Impairment of long-lived assets
   F- 11




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##### Table of Contents



(o) Impairment of goodwill
   (p) Income taxes
   (q) Value added taxes
  (r) Share-based compensation
  (s) Revenue recognition
    F- 12




---



##### Table of Contents



(t) Cost of revenue
  (u) Advertising expenses
   F- 13




---



##### Table of Contents



(v) Foreign currency translation
    (w) Government subsidies
  (x) Concentration of credit risk
    Amount$Balance as of January 1, 2009
    
    
    Provisions for doubtful accounts
    
    
    4,722,707Business acquisition
    
    
    2,440,358Write offs
    
    
    (1,539,914
    )Changes due to foreign exchange
    
    
    1,938Balance as of December 31, 2009
    
    
    5,625,089
 (y) Earnings per share
    F- 14




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##### Table of Contents



Years Ended December 31,2007
    
    
    2008
    
    
    2009Net income attributable to CRIC
    
    $
    2,065,849
    
    
    $
    22,161,661
    
    
    $
    55,602,291Weighted average ordinary
shares outstanding  basic
    
    
    71,522,222
    
    
    
    71,522,222
    
    
    
    86,610,265Share options
    
    
    
    
    
    
    
    
    
    
    1,654,036Weighted average number of
ordinary shares outstanding 
diluted
    
    
    71,522,222
    
    
    
    71,522,222
    
    
    
    88,264,301Basic earnings per share
    
    $
    0.03
    
    
    $
    0.31
    
    
    $
    0.64Diluted earnings per share
    
    $
    0.03
    
    
    $
    0.31
    
    
    $
    0.63
 (z) Comprehensive income
  (aa) Recently issued accounting pronouncements
    F- 15




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##### Table of Contents



3. Investments in Affiliated Companies
   F- 16




---



##### Table of Contents



Allocated
    
    
    AmortizationValue
    
    
    Period$Cash acquired
    
    
    1,700,000Intangible assetsAdvertising rights
    
    
    2,894,775
    
    
    10 yearsCustomer contract backlog
    
    
    313,919
    
    
    6 monthsTotal
    
    
    4,908,694
   4. Acquisitions of Subsidiaries
 Acquisition of COHT
   Amount$Fair value of Companys shares issued *
    
    
    572,000,004Replacement of COHTs share options (Note 9)
    
    
    14,960,796Consideration
    
    
    586,960,800Fair value of the Companys investment in COHT held before the
business combination **
    
    
    27,078,000Total value to be allocated in purchase accounting
    
    
    614,038,800
 *
    
    The fair value of the 47,666,667 ordinary shares issued by the Company was based on the IPO
offering price of the Companys American depositary shares (ADS).
 **
    
    As a result of the Company obtaining control over COHT, the Companys previously held equity
interest was remeasured to fair value of $27,078,000, with the excess of fair value over the
carrying amount recognized as a gain of $21,453,221.
  AmortizationAmount
    
    
    Period$Total tangible assets acquired
    
    
    26,703,269Liabilities assumed
    
    
    (17,432,772
    )Intangible assets acquired: License agreements with SINA
    
    
    80,660,000
    
    
    10 years Real estate advertising agency agreement with SINA
    
    
    106,790,000
    
    
    10 years CRIC database license agreement
    
    
    8,300,000
    
    
    9 years Customer relationship
    
    
    5,580,000
    
    
    10 years Contract Backlog
    
    
    110,000
    
    
    1 yearGoodwill
    
    
    444,885,665Deferred tax liabilities
    
    
    (41,557,362
    )614,038,800
  F- 17




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##### Table of Contents



Allocated
    
    
    AmortizationValue
    
    
    Period$Cash
    
    
    1,265,772Other current assets
    
    
    1,463,529Liabilities assumed
    
    
    (4,390,507
    )Leasehold improvements
    
    
    2,077,479
    
    
    5-20 yearsPrepaid rent
    
    
    4,348,647
    
    
    20 yearsFavorable lease term
    
    
    2,428,110
    
    
    20 yearsTotal
    
    
    7,193,030
   Allocated
    
    
    AmortizationValue
    
    
    Period$Cash acquired
    
    
    1,759,969Intangible assetsCustomer advertising designing contracts
    
    
    81,438
    
    
    3 monthsNon-compete agreement
    
    
    191,424
    
    
    5 yearsGoodwill
    
    
    666,257Deferred tax liabilities
    
    
    (20,360
    )Total
    
    
    2,678,728
   F- 18




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##### Table of Contents



Allocated
    
    
    AmortizationValue
    
    
    Period$Tangible assets acquired
    
    
    1,217,304Liabilities assumed
    
    
    (1,434,594
    )Intangible assetsNon-compete agreement
    
    
    1,420,688
    
    
    5 yearsGoodwill
    
    
    3,602,892Deferred tax liabilities
    
    
    (355,172
    )Total
    
    
    4,451,118
     Year ended December 31,2008
    
    
    2009$
    
    
    $Revenue
    
    
    84,355,530
    
    
    
    120,458,837Net income attributable to CRIC
    
    
    19,740,443
    
    
    
    29,884,719Earnings per share:Basic
    
    
    0.17
    
    
    
    0.24Diluted
    
    
    0.17
    
    
    
    0.24
 5. Property and Equipment, Net
  As of December 312008
    
    
    2009$
    
    
    $Leasehold improvements
    
    
    265,650
    
    
    
    4,020,790Furniture, fixtures and equipment
    
    
    2,133,841
    
    
    
    5,215,145Motor vehicles
    
    
    565,652
    
    
    
    353,492Total
    
    
    2,965,143
    
    
    
    9,589,427Less: Accumulated depreciation
    
    
    (443,953
    )
    
    
    (2,166,844
    )Property and equipment, net
    
    
    2,521,190
    
    
    
    7,422,583
  F- 19




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##### Table of Contents



6. Intangible Assets, Net
  As of December 31,2008
    
    
    2009$
    
    
    $License agreements with SINA
    
    
    
    
    
    
    80,660,000Real estate advertising agency agreement with SINA
    
    
    
    
    
    
    106,790,000CRIC database license agreement
    
    
    
    
    
    
    8,300,000Favorable lease term
    
    
    
    
    
    
    2,428,110Customer relationships
    
    
    
    
    
    
    5,788,603Customer contracts
    
    
    81,438
    
    
    
    110,000Non-compete agreements
    
    
    1,612,112
    
    
    
    1,612,112Computer software licenses
    
    
    1,741
    
    
    
    1,207,7441,695,291
    
    
    
    206,896,569Less: Accumulated amortizationLicense agreements with SINA
    
    
    
    
    
    
    (2,016,500
    )Real estate advertising agency agreement with SINA
    
    
    
    
    
    
    (2,617,402
    )CRIC database license agreement
    
    
    
    
    
    
    (244,118
    )Favorable lease term
    
    
    
    
    
    
    (91,054
    )Customer relationship
    
    
    
    
    
    
    (40,622
    )Customer contracts
    
    
    (81,438
    )
    
    
    (110,000
    )Non-compete agreements
    
    
    (84,444
    )
    
    
    (388,634
    )Computer software licenses
    
    
    (87
    )
    
    
    (249,348
    )(165,969
    )
    
    
    (5,757,678
    )Intangible assets subject to amortization, net
    
    
    1,529,322
    
    
    
    201,138,891
  7. Goodwill
  Real EstateInformationand
    
    
    Real Estate
    
    
    Real EstateConsulting
    
    
    Advertising
    
    
    OnlineService
    
    
    Service
    
    
    ServiceSegment
    
    
    Segment
    
    
    Segment
    
    
    Total$
    
    
    $
    
    
    $
    
    
    $Balance as of January 1, 2008
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Goodwill recognized upon acquisition
    
    
    3,602,892
    
    
    
    666,257
    
    
    
    
    
    
    
    4,269,149Balance as of December 31, 2008
    
    
    3,602,892
    
    
    
    666,257
    
    
    
    
    
    
    
    4,269,149Goodwill recognized upon acquisition
    
    
    747,897
    
    
    
    
    
    
    
    444,885,665
    
    
    
    445,633,562Balance as of December 31, 2009
    
    
    4,350,789
    
    
    
    666,257
    
    
    
    444,885,665
    
    
    
    449,902,711
  F- 20




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##### Table of Contents



8. Income Tax
  Years Ended December 312007
    
    
    2008
    
    
    2009$
    
    
    $
    
    
    $Current TaxPRC
    
    
    404,149
    
    
    
    3,976,671
    
    
    
    9,172,473Other
    
    
    130,974
    
    
    
    848,852
    
    
    
    2,655535,123
    
    
    
    4,825,523
    
    
    
    9,175,128Deferred TaxPRC
    
    
    (250,124
    )
    
    
    (104,508
    )
    
    
    (2,868,515
    )Income tax expense
    
    
    284,999
    
    
    
    4,721,015
    
    
    
    6,306,613
 Cayman Islands and British Virgin Islands
  Hong Kong
  PRC
      Year Ended December 31,2007
    
    
    2008
    
    
    2009$
    
    
    $
    
    
    $The aggregate dollar effect
    
    
    
    
    
    
    
    
    
    
    1,433,584Per share effectbasic
    
    
    
    
    
    
    
    
    
    
    0.02Per share effectdiluted
    
    
    
    
    
    
    
    
    
    
    0.02
  F- 21




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##### Table of Contents



As of December 31,2008
    
    
    2009$
    
    
    $Deferred tax assets:Accrued salary expenses
    
    
    25,868
    
    
    
    782,048Advertising expenses
    
    
    17,206
    
    
    
    Accrued rebate
    
    
    
    
    
    
    24,244Depreciation and amortization
    
    
    
    
    
    
    20,309Bad debt provision
    
    
    
    
    
    
    1,576,713Net operating loss carryforwards
    
    
    304,766
    
    
    
    808,325Gross and net deferred tax assets
    
    
    347,840
    
    
    
    3,211,639Analysis as:Current
    
    
    43,074
    
    
    
    3,046,040Non-current
    
    
    304,766
    
    
    
    165,599Deferred tax liabilities:Amortization of intangible and other assets
    
    
    338,259
    
    
    
    42,031,640Total deferred tax liabilities
    
    
    338,259
    
    
    
    42,031,640Analysis as:Current
    
    
    
    
    
    
    Non-current
    
    
    338,259
    
    
    
    42,031,640
  Year Ended December 31,2007
    
    
    2008
    
    
    2009PRC income tax rate
    
    
    33.00
    %
    
    
    25.00
    %
    
    
    25.00
    %Expenses not deductible for tax purposes
    
    
    9.26
    %
    
    
    3.40
    %
    
    
    1.13
    %Effect of tax preference
    
    
    (12.57)
    %
    
    
    (9.04)
    %
    
    
    (12.79)
    %Effect of different tax rate of subsidiary operations in other jurisdiction
    
    
    (12.45)
    %
    
    
    (1.59)
    %
    
    
    3.20
    %Effect of new income tax law
    
    
    3.48
    %
    
    
    
    
    
    
    Valuation allowance movement
    
    
    (8.60)
    %
    
    
    
    
    
    
    (0.73)
    %12.12
    %
    
    
    17.77
    %
    
    
    15.81
    %
   F- 22




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##### Table of Contents



9. Share-Based Compensation
 E-House Holdings Share Incentive Plan (the E-House Plan)
  Share Options:
   2007
    
    
    2008Average risk-free rate of return
    
    
    4.76
    %
    
    
    3.98
    %Contractual life of option
    
    10 years
    
    
    10 yearsAverage estimated volatility rate
    
    
    62.7
    %
    
    
    59.3
    %Average dividend yield
    
    
    0.00
    %
    
    
    0.00
    %
     F- 23




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##### Table of Contents



WeightedWeighted
    
    
    averageaverage
    
    
    remaining
    
    
    AggregateNumber of
    
    
    exercise
    
    
    contractual
    
    
    intrinsicoptions
    
    
    price
    
    
    term
    
    
    value of options$
    
    
    
    
    
    $Outstanding, as of January 1, 2009
    
    
    2,314,166
    
    
    
    5.39Granted
    
    
    Exercised
    
    
    (509,562
    )
    
    
    5.40Forfeited
    
    
    (45,167
    )
    
    
    5.37Cancelled
    
    
    Outstanding, as of December 31, 2009
    
    
    1,759,437
    
    
    
    5.38
    
    
    
    8.0
    
    
    
    22,411,580Vested and expected to vest as of
December 31, 2009
    
    
    1,654,984
    
    
    
    5.38
    
    
    
    7.9
    
    
    
    21,079,810Exercisable as of December 31, 2009
    
    
    602,605
    
    
    
    5.38
    
    
    
    7.9
    
    
    
    7,674,968
  Restricted Shares:
    F- 24




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##### Table of Contents



No. of
    
    
    Weighted averagerestricted shares
    
    
    grant-date fair value$Unvested as of January 1, 2009
    
    
    144,000
    
    
    
    1.39Granted
    
    
    931,000
    
    
    
    16.40Vested
    
    
    (144,000
    )
    
    
    1.39Forfeited
    
    
    
    
    
    
    Unvested as of December 31, 2009
    
    
    931,000
    
    
    
    16.40
     The Companys Share Incentive Plan (the CRIC Plan)
  Share Options:
   2009Average risk-free rate of return
    
    
    3.22
    %Contractual life of option
    
    10 yearsAverage estimated volatility rate
    
    
    71.79
    %Average dividend yield
    
    
    0.00
    %
   F- 25




---



##### Table of Contents



2009Average risk-free rate of return
    
    
    2.47
    %Contractual life of option
    
    5.2 yearsAverage estimated volatility rate
    
    
    63.18
    %Average dividend yield
    
    
    0.00
    %
   WeightedWeighted
    
    
    AverageAverage
    
    
    Remaining
    
    
    AggregateNumber of
    
    
    Exercise
    
    
    Contractual
    
    
    IntrinsicOptions
    
    
    Price
    
    
    Term
    
    
    Value of Options$
    
    
    
    
    
    
    $Outstanding, as of January 1, 2009
    
    
    
    
    
    
    Granted
    
    
    8,692,000
    
    
    
    4.23Replacement under the Options Replacement Program
    
    
    3,609,000
    
    
    
    0.64Exercised
    
    
    Forfeited
    
    
    (154,500
    )
    
    
    4.43Modified
    
    
    (504,500
    )
    
    
    3.00Cancelled
    
    
    (300,000
    )
    
    
    3.50Outstanding, as of December 31, 2009
    
    
    11,342,000
    
    
    
    3.16
    
    
    7.86 years
    
    
    88,649,505Expected to vest as of December 31, 2009
    
    
    10,681,370
    
    
    
    3.16
    
    
    7.86 years
    
    
    83,485,999Exercisable as of December 31, 2009
    
    
    615,469
    
    
    
    0.64
    
    
    4.97 years
    
    
    6,361,154
   F- 26




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##### Table of Contents



Restricted Shares:
  No. of
    
    
    Weighted AverageRestricted Shares
    
    
    Grant-Date Fair ValueUnvested as of January 1, 2009
    
    
    
    
    
    
    Granted
    
    
    300,000
    
    
    
    2.59Vested
    
    
    
    
    
    
    Forfeited
    
    
    
    
    
    
    Unvested as of December 31, 2009
    
    
    300,000
    
    
    
    2.59
   10. Employee Benefit Plans
  11. Distribution of Profits
    12. Segment Information
    F- 27




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##### Table of Contents



Real EstateInformation
    
    
    Real Estate
    
    
    Real Estateand Consulting
    
    
    Advertising
    
    
    Online2009
    
    Service
    
    
    Service
    
    
    Service
    
    
    Non-Allocated
    
    
    Total$
    
    
    $
    
    
    $
    
    
    $
    
    
    $Revenues from external customers
    
    
    68,045,340
    
    
    
    13,778,533
    
    
    
    13,829,937
    
    
    
    
    
    
    
    95,653,810Cost of revenues
    
    
    (1,865,697
    )
    
    
    (6,014,185
    )
    
    
    (4,930,280
    )
    
    
    
    
    
    
    (12,810,162
    )Selling, general and administrative expenses
    
    
    (22,723,019
    )
    
    
    (5,690,497
    )
    
    
    (11,359,944
    )
    
    
    (8,275,069
    )
    
    
    (48,048,529
    )Gain from settlement of pre-existing relationship
    
    
    2,100,832
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,100,832Income (loss) from operations
    
    
    45,557,456
    
    
    
    2,073,851
    
    
    
    (2,460,287
    )
    
    
    (8,275,069
    )
    
    
    36,895,951Interest income
    
    
    166,521
    
    
    
    27,635
    
    
    
    23,722
    
    
    
    61,201
    
    
    
    279,079Other income, net
    
    
    2,481,451
    
    
    
    
    
    
    
    5,814
    
    
    
    237,767
    
    
    
    2,725,032Income (loss) before taxes and equity in an associate
    
    
    48,205,428
    
    
    
    2,101,486
    
    
    
    (2,430,751
    )
    
    
    (7,976,101
    )
    
    
    39,900,062Income tax benefit (expense)
    
    
    (6,710,032
    )
    
    
    (553,666
    )
    
    
    957,085
    
    
    
    
    
    
    
    (6,306,613
    )Income (loss) before equity in affiliates
    
    
    41,495,396
    
    
    
    1,547,820
    
    
    
    (1,473,666
    )
    
    
    (7,976,101
    )
    
    
    33,593,449Income from investment in affiliates
    
    
    
    
    
    
    
    
    
    
    22,015,607
    
    
    
    
    
    
    
    22,015,607Net income (loss)
    
    
    41,495,396
    
    
    
    1,547,820
    
    
    
    20,541,941
    
    
    
    (7,976,101
    )
    
    
    55,609,056
 Real EstateInformation
    
    
    Real Estateand Consulting
    
    
    Advertising2008
    
    Service
    
    
    Service
    
    
    Non-Allocated
    
    
    Total$
    
    
    $
    
    
    $
    
    
    $Revenues from external customers
    
    
    49,116,061
    
    
    
    932,469
    
    
    
    
    
    
    
    50,048,530Cost of revenues
    
    
    (2,855,398
    )
    
    
    (41,849
    )
    
    
    
    
    
    
    (2,897,247
    )Selling, general and administrative expenses
    
    
    (13,776,504
    )
    
    
    (1,865,669
    )
    
    
    (4,177,700
    )
    
    
    (19,819,873
    )Income (loss) from operations
    
    
    32,484,159
    
    
    
    (975,049
    )
    
    
    (4,177,700
    )
    
    
    27,331,410Interest income
    
    
    415,512
    
    
    
    3,779
    
    
    
    1,226
    
    
    
    420,517Foreign exchange loss
    
    
    (1,323,858
    )
    
    
    
    
    
    
    (17,307
    )
    
    
    (1,341,165
    )Income (loss) before taxes and equity in an associate
    
    
    31,575,813
    
    
    
    (971,270
    )
    
    
    (4,193,781
    )
    
    
    26,410,762Income tax benefit (expense)
    
    
    (4,917,503
    )
    
    
    196,488
    
    
    
    
    
    
    
    (4,721,015
    )Income (loss) before equity in affiliates
    
    
    26,658,310
    
    
    
    (774,782
    )
    
    
    (4,193,781
    )
    
    
    21,689,747Income from investment in affiliates
    
    
    
    
    
    
    
    
    
    
    153,700
    
    
    
    153,700Net income (loss)
    
    
    26,658,310
    
    
    
    (774,782
    )
    
    
    (4,040,081
    )
    
    
    21,843,447
 Geographic
   F- 28




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##### Table of Contents



Major customers
  Years Ended December 31,2007
    
    
    2008
    
    
    2009$
    
    
    $
    
    
    $Customer A
    
    
    *
    
    
    
    28,321,400
    
    
    
    28,374,431Customer B
    
    
    *
    
    
    
    *
    
    
    
    10,846,980Customer C
    
    
    *
    
    
    
    7,788,385
    
    
    
    *Customer D
    
    
    *
    
    
    
    5,144,560
    
    
    
    *Customer E
    
    
    1,774,818
    
    
    
    *
    
    
    
    *Customer F
    
    
    1,690,435
    
    
    
    *
    
    
    
    *Customer G
    
    
    1,690,435
    
    
    
    *
    
    
    
    *
 
 *
    
    indicates the revenue from these customers was less than 10% in the stated periods.  Years Ended December 31,2008
    
    
    2009$
    
    
    $Customer A
    
    
    7,666,854
    
    
    
    *Customer B
    
    
    *
    
    
    
    6,150,942Customer C
    
    
    8,047,270
    
    
    
    *Customer H
    
    
    *
    
    
    
    4,210,564Customer I
    
    
    *
    
    
    
    5,179,182Customer J
    
    
    *
    
    
    
    3,368,519
 
 *
    
    indicates the accounts receivables from the customer was less than 10% as at the stated year end. 13. Related Party Balances and Transactions
  Company Name
    
    Relationship with the GroupE-House
    
    Under common control of E-House HoldingsShanghai JinYue Real Estate Development Co., Ltd.
    
    Mr. Xin Zhou, co-chairman of CRIC, is a
director of the entityE-House China Real Estate Investment Fund I, L.P. (the Fund)
    
    Partially owned by Mr. Xin Zhou,
co-chairman of CRICSINA
    
    Mr. Charles Chao, co-chairman of CRIC, is
a director and chief executive officer
of the entity (since October 16, 2009)
    F- 29




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##### Table of Contents



Years Ended December 31,2007
    
    
    2008
    
    
    2009$
    
    
    $
    
    
    $Corporate selling, general and administrative expenses allocated from E-House (Note 1)
    
    
    624,654
    
    
    
    3,516,284
    
    
    
    2,477,446Corporate service provided by E-House under onshore/offshore transitional service
agreement (Note 1)
    
    
    
    
    
    
    
    
    
    
    583,650Information and consulting services provided to E-House
    
    
    98,568
    
    
    
    
    
    
    
    6,338,045Advertising services provided to E-House
    
    
    
    
    
    
    169,928
    
    
    
    2,378,823Online advertising agency fee paid to SINA
    
    
    
    
    
    
    
    
    
    
    852,153
     As of December 31,2008
    
    
    2009$
    
    
    $Shanghai JinYue Real Estate Development Co., Ltd.
    
    
    146,314
    
    
    
    E-House
    
    
    5,326,545
    
    
    
    147,962SINA
    
    
    
    
    
    
    6,102,606Management
    
    
    
    
    
    
    1,050,000Total
    
    
    5,472,859
    
    
    
    7,300,568
      F- 30




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##### Table of Contents



Year Ended December 31,2008
    
    
    2009$
    
    
    $Balance at January 1
    
    
    2,160,269
    
    
    
    Collection of loans granted to E-House
    
    
    (2,061,701
    )
    
    
    Loans received from E-House
    
    
    (8,400,000
    )
    
    
    (2,499,977
    )Corporate expenses allocated from E-House
    
    
    (3,516,284
    )
    
    
    (2,477,446
    )Group revenues, net of expenses, collected by E-House
    
    
    924,514
    
    
    
    3,474,446Related party balance waivers
    
    
    10,991,770
    
    
    
    1,502,977Service provided to E-House
    
    
    169,928
    
    
    
    8,716,868Consulting service fee collected by E-House on behalf of CRIC
    
    
    
    
    
    
    1,148,711Transitional services fee charged from E-House
    
    
    
    
    
    
    (583,650
    )Payments received for services
    
    
    (268,496
    )
    
    
    (7,846,514
    )Balance at December 31
    
    
    
    
    
    
    1,435,415
 14. Commitments and contingencies
 a) Operating lease commitments
   Year Ending December 31
    
    $2010
    
    
    2,510,1232011
    
    
    1,622,7852012
    
    
    1,041,8222013
    
    
    641,8432014
    
    
    379,566Total
    
    
    6,196,139
  F- 31




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##### Table of Contents



(b) Contingencies
   F- 32




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##### Table of Contents



Appendix 1
 Entities included in the consolidated financial statements
  Percentage ofDate of
    
    Place of
    
    ownershipincorporation
    
    incorporation
    
    (%)CRIC (China) Information Technology Co., Ltd.
    
    April 26, 2006
    
    BVI
    
    
    100Shanghai CRIC Information Technology Co., Ltd.
    
    July 3, 2006
    
    PRC
    
    
    100E-House (China) Information Technology Service Limited
    
    January 15, 2008
    
    BVI
    
    
    100Hong Kong CRIC Information Technology Company Limited
    
    February 25, 2008
    
    Hong Kong
    
    
    100Shanghai CRIC Software Technology Co., Ltd.
    
    June 13, 2008
    
    PRC
    
    
    100Richpoint Overseas Ltd.
    
    April 7, 2008
    
    BVI
    
    
    85CRIC Information Technology Ltd.
    
    May 23, 2008
    
    Hong Kong
    
    
    85Wuhan CRIC Information Technology Co., Ltd.
    
    June 19, 2008
    
    PRC
    
    
    100Chengdu CRIC Information Technology Co., Ltd.
    
    April 21, 2008
    
    PRC
    
    
    100Shanghai
Tian Zhuo Advertising Co., Ltd.
    
    February 27, 2008
    
    PRC
    
    VIEShanghai Landpro Advertising Design Co., Ltd.
    
    December 19, 2008
    
    PRC
    
    
    100
    *Guangzhou Integrated Residential Building Industry Facility Co., Ltd.
    
    July 15, 2004
    
    PRC
    
    
    100
    *Wushi Consolidated (Beijing) Advertising Media Co., Ltd.
    
    July 28, 2008
    
    PRC
    
    
    60Portal Overseas Ltd.
    
    January 02, 2008
    
    BVI
    
    
    100Portal Holdings Ltd.
    
    February 25, 2008
    
    Hong Kong
    
    
    100Shanghai ShineLend Property Management Limited
    
    April 29, 2008
    
    PRC
    
    
    100Shanghai
Yifang Software Co., Ltd.
    
    February 27, 2009
    
    PRC
    
    
    100China Real Estate Business Network Technology Ltd.
    
    December 17, 2007
    
    PRC
    
    
    100Guangzhou
Real Estate Business Network Software Technology Co., Ltd.
    
    August 11, 2008
    
    PRC
    
    
    100Status Holding Ltd.
    
    October 30, 2008
    
    Hong Kong
    
    
    90Status Company Ltd.
    
    August 08, 2008
    
    BVI
    
    
    90Shanghai Ruizhe Information Technology Co., Ltd.
    
    July 4, 2008
    
    PRC
    
    
    100Shenzhen Fangyou Software Technology Co., Ltd.
    
    September 13, 2002
    
    PRC
    
    
    90China Online Housing (Hong Kong) Co., Ltd.
    
    December 17, 2007
    
    Hong Kong
    
    
    100China Online
Housing Technology Corporation
    
    December 29, 2007
    
    Cayman
    
    
    100China Real Estate Information (HK) Ltd.
    
    December 21, 2009
    
    Hong Kong
    
    
    100Beijing
Yisheng Leju Information Service Co., Ltd.
    
    February 13, 2008
    
    PRC
    
    VIEShanghai SINA Leju Information Technology Co., Ltd.
    
    May 8, 2008
    
    PRC
    
    
    100
    **CRIC (HK) Property Consultants Co., Ltd.
    
    September 16, 2009
    
    Hong Kong
    
    
    100CRIC Property Consultants Co., Ltd.
    
    November 24, 2009
    
    BVI
    
    
    100
 
 *:
    
    Wholly owned subsidiaries of
Shanghai Tian Zhuo Advertising Co., Ltd.**:
    
    Wholly owned subsidiaries of
Beijing Yisheng Leju Information Service Co., Ltd.  F- 33