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Accenture PLC (NYSE:ACN)
Beneish M-Score
-2.38 (As of Today)

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.

ACN' s 10-Year Beneish M-Score Range
Min: -3.31   Max: -2.31
Current: -2.38

-3.31
-2.31

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.


Definition

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
=-2.38

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

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

Measured as the ratio of days’ sales in receivables in year t to year t-1.

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)
=0.12108568 / 0.10966292
=1.1042

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.

GMI=GrossMargin_t-1 / GrossMargin_t
=(GrossProfit_t-1 / Revenue_t-1) / (GrossProfit_t / Revenue_t)
=(2536.357 / 30394.285) / (2468.62 / 31874.678)
=0.30874801 / 0.30382945
=1.0162

3. AQI = Asset Quality Index

AQI is the ratio of asset quality in year t to year t-1.

Asset quality is measured as the ratio of non-current assets other than plant, property and equipment to total assets.

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)
=0.29182566 / 0.25156718
=1.16

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.

SGI=Sales_t / Sales_t-1
=Revenue_t / Revenue_t-1
=31874.678 / 30394.285
=1.0487

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))
=0.43201479 / 0.43893983
=0.9842

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)
=0.16947525 / 0.17495187
=0.9687

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)
=0.45645709 / 0.48535995
=0.9405

8. TATA = Total Accruals to Total Assets

Total accruals calculated as the change in working capital accounts other than cash less depreciation.

TATA=(IncomefromContinuingOperations_t - CashFlowsfromOperations_t) / TotalAssets_t
=(NetIncome_t - NonOperatingIncome_t - CashFlowsfromOperations_t) / TotalAssets_t
=(2941.498 - -15.56 - 3486.085) / 17930.452
=-0.0295

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.


Related Terms

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


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

Accenture PLC Annual Data

Aug05Aug06Aug07Aug08Aug09Aug10Aug11Aug12Aug13Aug14
DSRI 0.93241.74760.96221.03440.81340.75651.0780.87451.05991.1042
GMI 1.02541.08730.97280.99210.96140.94041.0241.01590.97761.0162
AQI 1.12840.80541.29031.07441.06340.97271.08550.89591.27121.16
SGI 1.13111.06631.17691.180.91530.99671.18441.08871.02071.0487
DEPI 0.9870.94520.86180.93270.91550.9931.05880.91441.00060.9842
SGAI 0.95960.97770.93510.99871.0391.09950.95910.95591.01860.9687
LVGI 0.9911.13271.04450.85240.90861.01960.9820.96820.99750.9405
TATA -0.1069-0.1772-0.1288-0.09-0.128-0.1009-0.075-0.1025-0.0002-0.0295
M-score -2.85-2.64-2.88-2.64-3.31-3.25-2.53-3.02-2.31-2.38

Accenture PLC Quarterly Data

May12Aug12Nov12Feb13May13Aug13Nov13Feb14May14Aug14
DSRI 0.86340.87451.00381.01821.03031.05990.97941.00291.0921.1042
GMI 1.02091.01591.00190.99340.98060.97760.9830.991.00191.0162
AQI 1.05780.89590.94310.98121.03081.27121.22841.3991.35441.16
SGI 1.14041.08871.04891.02951.01661.02071.02241.01691.03231.0487
DEPI 0.94480.91440.96360.96710.9741.00060.98781.00050.99850.9842
SGAI 0.94060.95590.9710.98561.01471.01861.01891.010.99050.9687
LVGI 0.9880.96820.98120.94410.94490.99750.97820.99320.97340.9405
TATA -0.0872-0.1025-0.0643-0.0233-0.0332-0.0002-0.0143-0.0189-0.0092-0.0295
M-score -2.85-3.02-2.75-2.54-2.58-2.31-2.46-2.39-2.26-2.38
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