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Accenture PLC (NYSE:ACN)
Beneish M-Score
-3.05 (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 -3.05 suggests that the company is not a manipulator.

ACN' s 10-Year Beneish M-Score Range
Min: -3.71   Max: -0.41
Current: -3.05

-3.71
-0.41

During the past 13 years, the highest Beneish M-Score of Accenture PLC was -0.41. The lowest was -3.71. 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 * 0.6331+0.528 * 1.0317+0.404 * 1.0607+0.892 * 1.0541+0.115 * 0.9536
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.944+4.679 * -0.0692-0.327 * 1.0174
=-3.05

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

This Year (May15) TTM:Last Year (May14) TTM:
Accounts Receivable was $3,717 Mil.
Revenue was 8275.066 + 7931.59 + 8343.257 + 8267.319 = $32,817 Mil.
Gross Profit was 2524.905 + 2240.639 + 2539.29 + 2468.62 = $9,773 Mil.
Total Current Assets was $11,070 Mil.
Total Assets was $17,309 Mil.
Property, Plant and Equipment(Net PPE) was $752 Mil.
Depreciation, Depletion and Amortization(DDA) was $636 Mil.
Selling, General & Admin. Expense(SGA) was $5,352 Mil.
Total Current Liabilities was $7,888 Mil.
Long-Term Debt was $27 Mil.
Net Income was 793.697 + 690.726 + 831.53 + 701.016 = $3,017 Mil.
Non Operating Income was -3.839 + -21.508 + -2.979 + 5.877 = $-22 Mil.
Cash Flow from Operations was 1413.364 + 301.287 + 872.9 + 1649.212 = $4,237 Mil.
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.



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)
=(3717.048 / 32817.232) / (5570.061 / 31132.353)
=0.11326513 / 0.17891552
=0.6331

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)
=(2240.639 / 31132.353) / (2524.905 / 32817.232)
=0.30725098 / 0.2978147
=1.0317

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 - (11069.521 + 752.362) / 17308.727) / (1 - (11134.693 + 786.599) / 17002.384)
=0.3169987 / 0.29884586
=1.0607

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
=32817.232 / 31132.353
=1.0541

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))
=(610.371 / (610.371 + 786.599)) / (636.239 / (636.239 + 752.362))
=0.43692492 / 0.45818705
=0.9536

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)
=(5351.828 / 32817.232) / (5378.327 / 31132.353)
=0.16307981 / 0.17275684
=0.944

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)
=((27.217 + 7888.442) / 17308.727) / ((26.534 + 7616.168) / 17002.384)
=0.45732185 / 0.44950767
=1.0174

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
=(3016.969 - -22.449 - 4236.763) / 17308.727
=-0.0692

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 -3.05 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

Feb05Feb06Feb07Feb08Feb09Feb10Feb11Feb12Feb13Feb14
DSRI
GMI
AQI
SGI
DEPI
SGAI
LVGI
TATA
M-score

Accenture PLC Quarterly Data

Feb13May13Aug13Nov13Feb14May14Aug14Nov14Feb15May15
DSRI 1.44021.03031.05990.97941.05111.59871.10421.01510.64730.6331
GMI 0.99340.98060.97760.9830.991.00191.01621.02861.03651.0317
AQI 0.98121.03081.27121.22841.3991.35441.161.11971.02471.0607
SGI 1.02951.01661.02071.02241.01691.03231.04871.0621.07131.0541
DEPI 0.96710.9741.00060.98781.00050.99850.98420.93540.91290.9536
SGAI 0.98561.01471.01861.01891.010.99050.96870.94170.92510.944
LVGI 0.94410.94490.99750.97820.99320.97340.94050.97370.98981.0174
TATA -0.0233-0.0332-0.0002-0.0143-0.0189-0.0092-0.0295-0.0652-0.066-0.0692
M-score -2.15-2.58-2.31-2.46-2.35-1.79-2.38-2.64-3.01-3.05
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