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Accenture PLC (NYSE:ACN)
Beneish M-Score
-2.35 (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 -2.35 suggests that the company is not a manipulator.

ACN' s 10-Year Beneish M-Score Range
Min: -3.31   Max: -2.31
Current: -2.35

-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 -2.84.


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 * 1.0511+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
=-2.35

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

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

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)
=(5318.684 / 30600.108) / (4975.902 / 30090.405)
=0.17381259 / 0.16536507
=1.0511

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)
=(2449.347 / 30090.405) / (2230.142 / 30600.108)
=0.3062887 / 0.30938152
=0.99

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 - (10633.88 + 783.961) / 16357.209) / (1 - (12016.949 + 810.896) / 16358.73)
=0.30196888 / 0.21584102
=1.399

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
=30600.108 / 30090.405
=1.0169

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))
=0.42974804 / 0.42954202
=1.0005

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)
=0.17535912 / 0.17362571
=1.01

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)
=0.44718387 / 0.45024828
=0.9932

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
=(2904.404 - -37.793 - 3251.332) / 16357.209
=-0.0189

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.


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

Nov11Feb12May12Aug12Nov12Feb13May13Aug13Nov13Feb14
DSRI 0.95930.91070.87380.89050.98791.01221.01951.05971.02571.0511
GMI 1.01851.01291.02091.01591.00190.99340.98060.97760.9830.99
AQI 1.09691.04691.05780.89590.94310.98121.03081.27121.22841.399
SGI 1.19471.17931.14041.08871.04891.02951.01661.02071.02241.0169
DEPI 1.00610.98610.94480.91440.96360.96710.9741.00060.98781.0005
SGAI 0.96190.96630.94060.95590.9710.98561.01471.01861.01891.01
LVGI 0.98911.00070.9880.96820.98120.94410.94490.99750.97820.9932
TATA -0.0938-0.0985-0.0872-0.1025-0.0643-0.0233-0.0332-0.0002-0.0143-0.0189
M-score -2.72-2.83-2.84-3.01-2.76-2.55-2.59-2.31-2.42-2.35
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