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Accenture PLC (NYSE:ACN)
Beneish M-Score
-2.24 (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 -2.24 suggests that the company is not a manipulator.

ACN' s 10-Year Beneish M-Score Range
Min: -3.31   Max: -2.24
Current: -2.24

-3.31
-2.24

During the past 13 years, the highest Beneish M-Score of Accenture PLC was -2.24. The lowest was -3.31. And the median was -2.83.


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 * 1.1124+0.528 * 1.0019+0.404 * 1.3544+0.892 * 1.0323+0.115 * 0.9985
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9905+4.679 * -0.0092-0.327 * 0.9734
=-2.24

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

This Year (May14) TTM:Last Year (May13) TTM:
Accounts Receivable was $5,570 Mil.
Revenue was 8240.18 + 7567.483 + 7799.696 + 7524.994 = $31,132 Mil.
Gross Profit was 2536.357 + 2230.142 + 2449.347 + 2349.6 = $9,565 Mil.
Total Current Assets was $11,135 Mil.
Total Assets was $17,002 Mil.
Property, Plant and Equipment(Net PPE) was $787 Mil.
Depreciation, Depletion and Amortization(DDA) was $610 Mil.
Selling, General & Admin. Expense(SGA) was $5,378 Mil.
Total Current Liabilities was $7,616 Mil.
Long-Term Debt was $27 Mil.
Net Income was 817.336 + 671.3 + 751.846 + 671 = $2,911 Mil.
Non Operating Income was -6.051 + -4.766 + -10.62 + -23.358 = $-45 Mil.
Cash Flow from Operations was 1363.26 + 292.38 + 181.233 + 1275.51 = $3,112 Mil.
Accounts Receivable was $4,850 Mil.
Revenue was 7707.935 + 7493.32 + 7668.036 + 7288.259 = $30,158 Mil.
Gross Profit was 2438.019 + 2230.363 + 2366.193 + 2248.89 = $9,283 Mil.
Total Current Assets was $12,079 Mil.
Total Assets was $16,524 Mil.
Property, Plant and Equipment(Net PPE) was $799 Mil.
Depreciation, Depletion and Amortization(DDA) was $618 Mil.
Selling, General & Admin. Expense(SGA) was $5,260 Mil.
Total Current Liabilities was $7,631 Mil.
Long-Term Debt was $0 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)
=(5570.061 / 31132.353) / (4850.285 / 30157.55)
=0.17891552 / 0.16083153
=1.1124

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)
=(2230.142 / 30157.55) / (2536.357 / 31132.353)
=0.3078322 / 0.30725098
=1.0019

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 - (11134.693 + 786.599) / 17002.384) / (1 - (12078.919 + 798.915) / 16523.758)
=0.29884586 / 0.22064739
=1.3544

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
=31132.353 / 30157.55
=1.0323

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))
=(618.23 / (618.23 + 798.915)) / (610.371 / (610.371 + 786.599))
=0.43625035 / 0.43692492
=0.9985

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)
=(5378.327 / 31132.353) / (5260.031 / 30157.55)
=0.17275684 / 0.17441838
=0.9905

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)
=((26.534 + 7616.168) / 17002.384) / ((0 + 7630.622) / 16523.758)
=0.44950767 / 0.46179701
=0.9734

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
=(2911.482 - -44.795 - 3112.383) / 17002.384
=-0.0092

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 -2.24 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

Aug04Aug05Aug06Aug07Aug08Aug09Aug10Aug11Aug12Aug13
DSRI 1.07071.01270.93691.01281.03440.81341.09311.06550.89051.0597
GMI 1.05321.02541.08730.97280.99210.96140.94041.0241.01590.9776
AQI 1.28531.14770.94351.10141.07441.06340.97271.08550.89591.2712
SGI 1.12811.13111.06631.17691.180.91530.99671.18441.08871.0207
DEPI 0.93660.9870.94520.86180.93270.91550.9931.05880.91441.0006
SGAI 0.9090.95960.97770.93510.99871.0391.09950.95910.95591.0186
LVGI 0.90521.00571.09941.06130.85240.92151.00530.9820.96820.9975
TATA -0.1332-0.1069-0.1757-0.1288-0.09-0.128-0.1009-0.075-0.1025-0.0002
M-score -2.74-2.77-3.31-2.91-2.64-3.31-2.93-2.54-3.01-2.31

Accenture PLC Quarterly Data

Feb12May12Aug12Nov12Feb13May13Aug13Nov13Feb14May14
DSRI 0.91070.87380.89050.98791.01221.01951.05971.02571.05111.1124
GMI 1.01291.02091.01591.00190.99340.98060.97760.9830.991.0019
AQI 1.04691.05780.89590.94310.98121.03081.27121.22841.3991.3544
SGI 1.17931.14041.08871.04891.02951.01661.02071.02241.01691.0323
DEPI 0.98610.94480.91440.96360.96710.9741.00060.98781.00050.9985
SGAI 0.96630.94060.95590.9710.98561.01471.01861.01891.010.9905
LVGI 1.00070.9880.96820.98120.94410.94490.99750.97820.99320.9734
TATA -0.0985-0.0872-0.1025-0.0643-0.0233-0.0332-0.0002-0.0143-0.0189-0.0092
M-score -2.83-2.84-3.01-2.76-2.55-2.59-2.31-2.42-2.35-2.24
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