Switch to:
Air T Inc (NAS:AIRT)
Beneish M-Score
-2.34 (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.

Air T Inc has a M-score of -2.34 suggests that the company is not a manipulator.

AIRT' s 10-Year Beneish M-Score Range
Min: -3.43   Max: 9.57
Current: -2.34

-3.43
9.57

During the past 13 years, the highest Beneish M-Score of Air T Inc was 9.57. The lowest was -3.43. And the median was -2.38.


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 Air T 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 * 1.0664+0.528 * 0.879+0.404 * 0.9824+0.892 * 0.9778+0.115 * 0.8383
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.1619+4.679 * 0.0535-0.327 * 1.1114
=-2.34

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

This Year (Mar14) TTM:Last Year (Mar13) TTM:
Accounts Receivable was $12.6 Mil.
Revenue was 25.467 + 29.835 + 24.19 + 21.28 = $100.8 Mil.
Gross Profit was 4.377 + 4.761 + 3.752 + 3.315 = $16.2 Mil.
Total Current Assets was $31.2 Mil.
Total Assets was $37.2 Mil.
Property, Plant and Equipment(Net PPE) was $4.0 Mil.
Depreciation, Depletion and Amortization(DDA) was $0.8 Mil.
Selling, General & Admin. Expense(SGA) was $12.8 Mil.
Total Current Liabilities was $9.0 Mil.
Long-Term Debt was $0.0 Mil.
Net Income was 0.417 + 0.455 + 0.456 + 0.139 = $1.5 Mil.
Non Operating Income was 0.026 + 0 + 0.006 + 0 = $0.0 Mil.
Cash Flow from Operations was -0.468 + 5.342 + -4.887 + -0.542 = $-0.6 Mil.
Accounts Receivable was $12.1 Mil.
Revenue was 30.711 + 26.703 + 21.162 + 24.488 = $103.1 Mil.
Gross Profit was 3.872 + 4.058 + 3.163 + 3.475 = $14.6 Mil.
Total Current Assets was $30.5 Mil.
Total Assets was $36.1 Mil.
Property, Plant and Equipment(Net PPE) was $3.5 Mil.
Depreciation, Depletion and Amortization(DDA) was $0.5 Mil.
Selling, General & Admin. Expense(SGA) was $11.3 Mil.
Total Current Liabilities was $7.9 Mil.
Long-Term Debt was $0.0 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)
=(12.637 / 100.772) / (12.12 / 103.064)
=0.1254019 / 0.11759683
=1.0664

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)
=(4.761 / 103.064) / (4.377 / 100.772)
=0.14134906 / 0.16080856
=0.879

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 - (31.152 + 3.986) / 37.221) / (1 - (30.528 + 3.473) / 36.055)
=0.05596303 / 0.05696852
=0.9824

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
=100.772 / 103.064
=0.9778

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))
=(0.533 / (0.533 + 3.473)) / (0.752 / (0.752 + 3.986))
=0.13305042 / 0.15871676
=0.8383

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)
=(12.843 / 100.772) / (11.305 / 103.064)
=0.12744612 / 0.10968913
=1.1619

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)
=((0 + 9.019) / 37.221) / ((0 + 7.861) / 36.055)
=0.24230945 / 0.21802801
=1.1114

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
=(1.467 - 0.032 - -0.555) / 37.221
=0.0535

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.

Air T Inc has a M-score of -2.34 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.

Air T Inc Annual Data

Mar05Mar06Mar07Mar08Mar09Mar10Mar11Mar12Mar13Mar14
DSRI 1.37150.46761.11431.72410.76541.08831.0664
GMI 00.98960.99471.18671.11431.08830.879
AQI 1.0751.12430.80641.00170.83361.00590.9824
SGI 1.16491.15650.89421.02821.07221.15310.9778
DEPI 1.10540.95120.89341.0182.16360.81760.8383
SGAI 0.91440.95561.05880.96760.99840.86481.1622
LVGI 0.93380.79890.61441.46760.97370.96021.1114
TATA 0.1037-0.0989-0.05950.19450.0164-0.07470.0536
M-score -1.96-3.18-2.72-0.92-2.42-2.55-2.34

Air T Inc Quarterly Data

Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14
DSRI 0.81380.76541.34950.66040.75171.08831.04751.43161.08521.0664
GMI 1.10971.11431.1331.07211.04721.08831.02451.02611.01290.879
AQI 0.97570.83360.72170.82690.81631.00591.01310.94971.08970.9824
SGI 1.21191.07221.14621.03131.00571.15311.02621.10621.12710.9778
DEPI 1.66762.15830.9390.7270.61230.81961.3371.57281.5440.8383
SGAI 0.88920.99820.93551.02731.0340.8650.97960.91530.95871.1619
LVGI 0.82950.97371.16460.75131.05620.96021.28781.54251.09191.1114
TATA 0.00530.01640.0637-0.0452-0.072-0.0748-0.07430.08950.04870.0535
M-score -2.24-2.42-1.82-2.96-3.16-2.55-2.79-1.67-1.98-2.34
Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)
Free 7-day Trial
FEEDBACK
Email Hide