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Advent Software Inc (NAS:ADVS)
Beneish M-Score
-3.10 (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.

Advent Software Inc has a M-score of -3.10 suggests that the company is not a manipulator.

ADVS' s 10-Year Beneish M-Score Range
Min: -3.93   Max: 0.66
Current: -3.1

-3.93
0.66

During the past 13 years, the highest Beneish M-Score of Advent Software Inc was 0.66. The lowest was -3.93. And the median was -2.90.


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 Advent Software Inc 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 * 1.0169+0.528 * 0.9766+0.404 * 0.9687+0.892 * 1.0362+0.115 * 1.0091
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.8511+4.679 * -0.1493-0.327 * 0.9217
=-3.10

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

This Year (Dec14) TTM:Last Year (Dec13) TTM:
Accounts Receivable was $61.9 Mil.
Revenue was 100.664 + 98.982 + 100.37 + 96.804 = $396.8 Mil.
Gross Profit was 71.3 + 69.098 + 70.579 + 68.322 = $279.3 Mil.
Total Current Assets was $151.2 Mil.
Total Assets was $434.9 Mil.
Property, Plant and Equipment(Net PPE) was $28.0 Mil.
Depreciation, Depletion and Amortization(DDA) was $21.2 Mil.
Selling, General & Admin. Expense(SGA) was $118.0 Mil.
Total Current Liabilities was $273.2 Mil.
Long-Term Debt was $200.0 Mil.
Net Income was 14.704 + 11.983 + 12.639 + 10.886 = $50.2 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0.0 Mil.
Cash Flow from Operations was 43.581 + 28.263 + 22.439 + 20.875 = $115.2 Mil.
Accounts Receivable was $58.7 Mil.
Revenue was 97.579 + 96.767 + 96.123 + 92.49 = $383.0 Mil.
Gross Profit was 68.524 + 64.976 + 65.727 + 64.011 = $263.2 Mil.
Total Current Assets was $147.7 Mil.
Total Assets was $456.3 Mil.
Property, Plant and Equipment(Net PPE) was $31.7 Mil.
Depreciation, Depletion and Amortization(DDA) was $24.4 Mil.
Selling, General & Admin. Expense(SGA) was $133.8 Mil.
Total Current Liabilities was $253.7 Mil.
Long-Term Debt was $285.0 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)
=(61.87 / 396.82) / (58.717 / 382.959)
=0.15591452 / 0.15332451
=1.0169

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)
=(69.098 / 382.959) / (71.3 / 396.82)
=0.68737907 / 0.70384305
=0.9766

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 - (151.211 + 27.995) / 434.869) / (1 - (147.657 + 31.698) / 456.294)
=0.58790808 / 0.60693106
=0.9687

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
=396.82 / 382.959
=1.0362

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))
=(24.393 / (24.393 + 31.698)) / (21.201 / (21.201 + 27.995))
=0.4348826 / 0.43094967
=1.0091

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)
=(118.007 / 396.82) / (133.802 / 382.959)
=0.29738168 / 0.34938988
=0.8511

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)
=((200 + 273.18) / 434.869) / ((285 + 253.68) / 456.294)
=1.08809779 / 1.18055464
=0.9217

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
=(50.212 - 0 - 115.158) / 434.869
=-0.1493

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.

Advent Software Inc has a M-score of -3.10 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.

Advent Software Inc Annual Data

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 0.90891.13050.98410.88590.8711.03361.08060.89380.90091.0169
GMI 0.93361.01820.9941.04150.9640.98291.05051.00370.95730.9766
AQI 0.94161.69930.96491.06180.93060.7921.19891.0091.15560.9687
SGI 1.12471.09121.16951.10491.09091.09251.15081.09981.06731.0362
DEPI 1.10671.53531.10881.1750.74111.10690.85440.85050.94241.0091
SGAI 1.00451.02870.92820.94120.96570.98960.90950.91411.11490.8511
LVGI 1.1881.27571.25061.13780.79850.98931.1961.03842.44810.9217
TATA -0.07690.0941-0.1537-0.1316-0.082-0.1053-0.0877-0.0854-0.1529-0.1493
M-score -2.92-1.58-3.14-3.08-2.91-2.93-2.64-2.90-3.69-3.10

Advent Software Inc Quarterly Data

Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14
DSRI 0.8480.89380.86420.91470.98470.90090.83270.99520.93621.0169
GMI 1.02751.00370.98570.970.95790.95730.96260.96780.97070.9766
AQI 0.82791.0090.99880.66851.18441.15561.17731.7051.00250.9687
SGI 1.11911.09981.07871.06711.06881.06731.06281.05591.04331.0362
DEPI 0.83490.85050.87730.8870.88870.94240.99211.0531.0331.0091
SGAI 0.91650.91410.92051.05751.0881.11491.1480.87970.8650.8511
LVGI 1.06711.03841.02392.4972.82622.44812.47361.02130.90520.9217
TATA -0.0894-0.0854-0.0837-0.0891-0.1516-0.1529-0.165-0.1293-0.1426-0.1493
M-score -3.01-2.90-2.94-3.58-3.71-3.69-3.81-2.75-3.12-3.10
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