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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 -2.38 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 -2.78.
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 * 1.1042||+||0.528 * 1.0162||+||0.404 * 1.16||+||0.892 * 1.0487||+||0.115 * 0.9842|
|-||0.172 * SGAI||+||4.679 * TATA||-||0.327 * LVGI|
|-||0.172 * 0.9687||+||4.679 * -0.0295||-||0.327 * 0.9405|
|This Year (Aug14) TTM:||Last Year (Aug13) TTM:|
|Accounts Receivable was $3,860 Mil.|
Revenue was 8267.319 + 8240.18 + 7567.483 + 7799.696 = $31,875 Mil.
Gross Profit was 2468.62 + 2536.357 + 2230.142 + 2449.347 = $9,684 Mil.
Total Current Assets was $11,904 Mil.
Total Assets was $17,930 Mil.
Property, Plant and Equipment(Net PPE) was $793 Mil.
Depreciation, Depletion and Amortization(DDA) was $621 Mil.
Selling, General & Admin. Expense(SGA) was $5,402 Mil.
Total Current Liabilities was $8,158 Mil.
Long-Term Debt was $26 Mil.
Net Income was 701.016 + 817.336 + 671.3 + 751.846 = $2,941 Mil.
Non Operating Income was 5.877 + -6.051 + -4.766 + -10.62 = $-16 Mil.
Cash Flow from Operations was 1649.212 + 1363.26 + 292.38 + 181.233 = $3,486 Mil.
|Accounts Receivable was $3,333 Mil.
Revenue was 7524.994 + 7707.935 + 7493.32 + 7668.036 = $30,394 Mil.
Gross Profit was 2349.6 + 2438.019 + 2230.363 + 2366.193 = $9,384 Mil.
Total Current Assets was $11,844 Mil.
Total Assets was $16,867 Mil.
Property, Plant and Equipment(Net PPE) was $780 Mil.
Depreciation, Depletion and Amortization(DDA) was $593 Mil.
Selling, General & Admin. Expense(SGA) was $5,318 Mil.
Total Current Liabilities was $8,161 Mil.
Long-Term Debt was $26 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)|
|=||(3859.567 / 31874.678)||/||(3333.126 / 30394.285)|
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)|
|=||(2536.357 / 30394.285)||/||(2468.62 / 31874.678)|
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 - (11904.442 + 793.444) / 17930.452)||/||(1 - (11844.178 + 779.675) / 16867.049)|
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))|
|=||(593.028 / (593.028 + 779.675))||/||(620.743 / (620.743 + 793.444))|
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)|
|=||(5401.969 / 31874.678)||/||(5317.537 / 30394.285)|
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)|
|=||((26.403 + 8158.079) / 17930.452)||/||((25.6 + 8160.99) / 16867.049)|
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|
|=||(2941.498 - -15.56||-||3486.085)||/||17930.452|
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 -2.38 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