Second, EDU is an asset heavy VIE. In its last published financial statements, EDU reported that it had 62% of its assets and 97% of its revenue in the VIE. One of the requirements for consolidation is that the public company has an interest in the residual profits of the VIE. In the case of EDU, as is the case for most VIEs, the interest in residual profits is obtained through technical service agreements that allow the public company to extract the profits from the VIE through fees. Many VIEs do not appear to be making those fee payments, leaving all of the profits to accumulate in the VIE. That raises the question of whether the public company actually has an interest in those profits. If it does not take them out by following the VIE agreements, how does it plan to ever get those profits to the shareholders?
Like I told the newbie longs last summer when I SHORTED AT AN AVERAGE OF 155....Bidu is a fraudulent company reporting fraudulent numbers and I will be adding to my short in the AM...Good luck.....If you are German you should have more sense than buying into a fraud such as this ADR and many others!!!