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Air T Inc (NAS:AIRT)
Beneish M-Score
-1.48 (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 -1.48 signals that the company is a manipulator.

AIRT' s Beneish M-Score Range Over the Past 10 Years
Min: -3.78   Max: 9.56
Current: -1.48

-3.78
9.56

During the past 13 years, the highest Beneish M-Score of Air T Inc was 9.56. The lowest was -3.78. And the median was -2.27.


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 * 0.9143+0.528 * 0.9501+0.404 * 2.7781+0.892 * 1.2284+0.115 * 1.4825
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9939+4.679 * 0.0264-0.327 * 0.9789
=-1.48

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

This Year (Dec15) TTM:Last Year (Dec14) TTM:
Accounts Receivable was $15.0 Mil.
Revenue was 46.619 + 44.654 + 22.359 + 24.885 = $138.5 Mil.
Gross Profit was 10.308 + 9.366 + 2.931 + 2.549 = $25.2 Mil.
Total Current Assets was $38.1 Mil.
Total Assets was $49.8 Mil.
Property, Plant and Equipment(Net PPE) was $4.5 Mil.
Depreciation, Depletion and Amortization(DDA) was $0.9 Mil.
Selling, General & Admin. Expense(SGA) was $17.0 Mil.
Total Current Liabilities was $12.2 Mil.
Long-Term Debt was $0.0 Mil.
Net Income was 2.971 + 3.794 + -0.736 + -0.856 = $5.2 Mil.
Non Operating Income was 0.004 + 0 + -0.02 + -0.01 = $-0.0 Mil.
Cash Flow from Operations was 6.969 + 0.534 + -4.515 + 0.897 = $3.9 Mil.
Accounts Receivable was $13.3 Mil.
Revenue was 30.893 + 34.625 + 21.779 + 25.467 = $112.8 Mil.
Gross Profit was 5.236 + 6.482 + 3.361 + 4.377 = $19.5 Mil.
Total Current Assets was $37.5 Mil.
Total Assets was $42.5 Mil.
Property, Plant and Equipment(Net PPE) was $2.8 Mil.
Depreciation, Depletion and Amortization(DDA) was $0.9 Mil.
Selling, General & Admin. Expense(SGA) was $13.9 Mil.
Total Current Liabilities was $10.6 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)
=(14.969 / 138.517) / (13.328 / 112.764)
=0.10806616 / 0.11819375
=0.9143

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)
=(9.366 / 112.764) / (10.308 / 138.517)
=0.17253733 / 0.18159504
=0.9501

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 - (38.096 + 4.516) / 49.757) / (1 - (37.529 + 2.797) / 42.524)
=0.14359789 / 0.05168846
=2.7781

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
=138.517 / 112.764
=1.2284

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))
=(0.874 / (0.874 + 2.797)) / (0.864 / (0.864 + 4.516))
=0.23808227 / 0.1605948
=1.4825

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)
=(17.013 / 138.517) / (13.935 / 112.764)
=0.12282247 / 0.12357667
=0.9939

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)
=((0.011 + 12.166) / 49.757) / ((0 + 10.631) / 42.524)
=0.24472938 / 0.25
=0.9789

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
=(5.173 - -0.026 - 3.885) / 49.757
=0.0264

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 -1.48 signals that the company is likely to 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

Mar06Mar07Mar08Mar09Mar10Mar11Mar12Mar13Mar14Mar15
DSRI 1.03491.03891.37840.44061.00172.02990.71421.13230.89670.8359
GMI 1.05530.80761.04440.98960.99471.18671.12131.00220.94861.0234
AQI 0.90480.96681.0751.12430.80641.00170.83361.00590.98240.9108
SGI 1.13610.84631.16491.15650.89421.02821.07221.15310.97781.1132
DEPI 0.94290.78781.10540.95120.89341.0182.76010.64090.83830.6349
SGAI 1.00821.18050.91130.95561.05880.96760.99840.95311.05450.9947
LVGI 0.92080.95160.93380.79890.61441.46760.97370.96021.11141.2579
TATA 0.07440.00510.1037-0.0989-0.06380.19450.017-0.07470.0536-0.1262
M-score -1.97-2.71-1.40-3.21-2.85-0.64-2.39-2.59-2.44-3.27

Air T Inc Quarterly Data

Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15
DSRI 1.42961.04380.89670.87431.17151.25070.83590.94420.97320.9143
GMI 1.02611.01290.8790.89920.85790.85831.02341.05221.0390.9501
AQI 0.94971.08970.98241.3041.2450.93030.91082.16182.12122.7781
SGI 1.10621.12710.97781.01421.08571.06371.11321.11351.09921.2284
DEPI 1.57281.5440.83830.64960.74910.62370.63430.89041.02211.4825
SGAI 0.91530.95871.16191.11991.10831.04630.99471.01240.95180.9939
LVGI 1.54251.09191.11140.98560.88140.9851.25791.24471.21040.9789
TATA 0.08930.04850.05330.0798-0.04-0.0679-0.1264-0.0793-0.01920.0264
M-score -1.68-2.02-2.50-2.20-2.42-2.66-3.27-2.40-2.09-1.48
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