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The zones of discrimination for M-Score is as such:
An M-Score of less than -2.22 suggests that the company is not an accounting manipulator.
An M-Score of greater than -2.22 signals that the company is likely an accounting manipulator.
Accenture PLC has a M-score of -2.35 suggests that the company is not a manipulator.
During the past 13 years, the highest Beneish M-Score of Accenture PLC was -2.31. The lowest was -3.31. And the median was -2.84.
The M-score was created by Professor Messod Beneish. Instead of measuring the bankruptcy risk (Z-Score) or business trend (F-Score), M-score can be used to detect the risk of earnings manipulation. This is the original research paper on M-score.
The M-Score Variables:
The M-score of Accenture PLC for today is based on a combination of the following eight different indices:
|M||=||-4.84||+||0.92 * DSRI||+||0.528 * GMI||+||0.404 * AQI||+||0.892 * SGI||+||0.115 * DEPI|
|=||-4.84||+||0.92 * 1.0511||+||0.528 * 0.99||+||0.404 * 1.399||+||0.892 * 1.0169||+||0.115 * 1.0005|
|-||0.172 * SGAI||+||4.679 * TATA||-||0.327 * LVGI|
|-||0.172 * 1.01||+||4.679 * -0.0189||-||0.327 * 0.9932|
|This Year (Feb14) TTM:||Last Year (Feb13) TTM:|
|Accounts Receivable was $5,319 Mil.|
Revenue was 7567.483 + 7799.696 + 7524.994 + 7707.935 = $30,600 Mil.
Gross Profit was 2230.142 + 2449.347 + 2349.6 + 2438.019 = $9,467 Mil.
Total Current Assets was $10,634 Mil.
Total Assets was $16,357 Mil.
Property, Plant and Equipment(Net PPE) was $784 Mil.
Depreciation, Depletion and Amortization(DDA) was $590 Mil.
Selling, General & Admin. Expense(SGA) was $5,366 Mil.
Total Current Liabilities was $7,288 Mil.
Long-Term Debt was $26 Mil.
Net Income was 671.3 + 751.846 + 671 + 810.258 = $2,904 Mil.
Non Operating Income was -4.766 + -10.62 + -23.358 + 0.951 = $-38 Mil.
Cash Flow from Operations was 292.38 + 181.233 + 1275.51 + 1502.209 = $3,251 Mil.
|Accounts Receivable was $4,976 Mil.
Revenue was 7493.32 + 7668.036 + 7288.259 + 7640.79 = $30,090 Mil.
Gross Profit was 2230.363 + 2366.193 + 2248.89 + 2370.905 = $9,216 Mil.
Total Current Assets was $12,017 Mil.
Total Assets was $16,359 Mil.
Property, Plant and Equipment(Net PPE) was $811 Mil.
Depreciation, Depletion and Amortization(DDA) was $611 Mil.
Selling, General & Admin. Expense(SGA) was $5,224 Mil.
Total Current Liabilities was $7,365 Mil.
Long-Term Debt was $0 Mil.
1. DSRI = Days Sales in Receivables Index
A large increase in DSR could be indicative of revenue inflation.
|DSRI||=||(Receivables_t / Revenue_t)||/||(Receivables_t-1 / Revenue_t-1)|
|=||(5318.684 / 30600.108)||/||(4975.902 / 30090.405)|
2. GMI = Gross Margin Index
Measured as the ratio of gross margin in year t-1 to gross margin in year t.
Gross margin has deteriorated when this index is above 1. A firm with poorer prospects is more likely to manipulate earnings.
|=||(GrossProfit_t-1 / Revenue_t-1)||/||(GrossProfit_t / Revenue_t)|
|=||(2449.347 / 30090.405)||/||(2230.142 / 30600.108)|
3. AQI = Asset Quality Index
AQI is the ratio of asset quality in year t to year t-1.
|AQI||=||(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t)||/||(1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)|
|=||(1 - (10633.88 + 783.961) / 16357.209)||/||(1 - (12016.949 + 810.896) / 16358.73)|
4. SGI = Sales Growth Index
Ratio of sales in year t to sales in year t-1.
Sales growth is not itself a measure of manipulation. However, growth companies are likely to find themselves under pressure to manipulate in order to keep up appearances.
5. DEPI = Depreciation Index
Measured as the ratio of the rate of depreciation in year t-1 to the corresponding rate in year t.
DEPI greater than 1 indicates that assets are being depreciated at a slower rate. This suggests that the firm might be revising useful asset life assumptions upwards, or adopting a new method that is income friendly.
|DEPI||=||(Depreciation_t-1 / (Depreciaton_t-1 + PPE_t-1))||/||(Depreciation_t / (Depreciaton_t + PPE_t))|
|=||(611.1 / (611.1 + 810.896))||/||(590.305 / (590.305 + 783.961))|
6. SGAI = Sales, General and Administrative expenses Index
The ratio of SGA expenses in year t relative to year t-1.
SGA expenses index > 1 means that the company is becoming less efficient in generate sales.
|SGAI||=||(SGA_t / Sales_t)||/||(SGA_t-1 /Sales_t-1)|
|=||(5366.008 / 30600.108)||/||(5224.468 / 30090.405)|
7. LVGI = Leverage Index
The ratio of total debt to total assets in year t relative to yeat t-1.
An LVGI > 1 indicates an increase$sgai= in leverage
|LVGI||=||((LTD_t + CurrentLiabilities_t) / TotalAssets_t)||/||((LTD_t-1 + CurrentLiabilities_t-1) / TotalAssets_t-1)|
|=||((26.322 + 7288.358) / 16357.209)||/||((0.016 + 7365.474) / 16358.73)|
8. TATA = Total Accruals to Total Assets
Total accruals calculated as the change in working capital accounts other than cash less depreciation.
|=||(NetIncome_t - NonOperatingIncome_t||-||CashFlowsfromOperations_t)||/||TotalAssets_t|
|=||(2904.404 - -37.793||-||3251.332)||/||16357.209|
An M-Score of less than -2.22 suggests that the company will not be a manipulator. An M-Score of greater than -2.22 signals that the company is likely to be a manipulator.
Accenture PLC has a M-score of -2.35 suggests that the company will not be a manipulator.
Altman Z-Score, Piotroski F-Score, Accounts Receivable, Revenue, Gross Profit, Total Current Assets, Total Assets, Property, Plant and Equipment, Depreciation, Depletion and Amortization, Selling, General & Admin. Expense, Total Current Liabilities, Long-Term Debt, Net Income, Non Operating Income, Cash Flow from Operations
Accenture PLC Annual Data
Accenture PLC Quarterly Data