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Apache Corporation (NYSE:APA)
Beneish M-Score
-7.51 (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.

Apache Corporation has a M-score of -7.51 suggests that the company is not a manipulator.

APA' s Beneish M-Score Range Over the Past 10 Years
Min: -7.51   Max: -0.6
Current: -7.51

-7.51
-0.6

During the past 13 years, the highest Beneish M-Score of Apache Corporation was -0.60. The lowest was -7.51. And the median was -2.74.


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 Apache Corporation 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 * 0.894+0.528 * 1.0701+0.404 * 0.8426+0.892 * 0.6515+0.115 * 0.2095
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.2893+4.679 * -0.9124-0.327 * 1.578
=-7.51

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

This Year (Sep15) TTM:Last Year (Sep14) TTM:
Accounts Receivable was $1,332 Mil.
Revenue was 1496 + 1977 + 1818 + 3733 = $9,024 Mil.
Gross Profit was 988 + 1928 + 1762 + 2880 = $7,558 Mil.
Total Current Assets was $4,079 Mil.
Total Assets was $27,812 Mil.
Property, Plant and Equipment(Net PPE) was $22,377 Mil.
Depreciation, Depletion and Amortization(DDA) was $26,718 Mil.
Selling, General & Admin. Expense(SGA) was $378 Mil.
Total Current Liabilities was $2,167 Mil.
Long-Term Debt was $8,777 Mil.
Net Income was -5655 + -5600 + -4651 + -4814 = $-20,720 Mil.
Non Operating Income was 0 + -2 + -2 + 6 = $2 Mil.
Cash Flow from Operations was 789 + 1283 + 650 + 1933 = $4,655 Mil.
Accounts Receivable was $2,287 Mil.
Revenue was 3441 + 3289 + 3675 + 3446 = $13,851 Mil.
Gross Profit was 2786 + 3223 + 3605 + 2800 = $12,414 Mil.
Total Current Assets was $4,426 Mil.
Total Assets was $60,990 Mil.
Property, Plant and Equipment(Net PPE) was $53,035 Mil.
Depreciation, Depletion and Amortization(DDA) was $6,825 Mil.
Selling, General & Admin. Expense(SGA) was $450 Mil.
Total Current Liabilities was $4,307 Mil.
Long-Term Debt was $10,902 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)
=(1332 / 9024) / (2287 / 13851)
=0.14760638 / 0.16511443
=0.894

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)
=(1928 / 13851) / (988 / 9024)
=0.89625298 / 0.83754433
=1.0701

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 - (4079 + 22377) / 27812) / (1 - (4426 + 53035) / 60990)
=0.04875593 / 0.05786194
=0.8426

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
=9024 / 13851
=0.6515

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))
=(6825 / (6825 + 53035)) / (26718 / (26718 + 22377))
=0.11401604 / 0.5442102
=0.2095

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)
=(378 / 9024) / (450 / 13851)
=0.0418883 / 0.03248863
=1.2893

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)
=((8777 + 2167) / 27812) / ((10902 + 4307) / 60990)
=0.39349921 / 0.24936875
=1.578

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
=(-20720 - 2 - 4655) / 27812
=-0.9124

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.

Apache Corporation has a M-score of -7.51 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.

Apache Corporation Annual Data

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 1.08081.0740.95050.56331.63850.98341.03310.99111.04990.7702
GMI 0.96811.03451.00120.98450.84730.99811.00291.21521.01380.9952
AQI 0.87311.17451.17141.17130.93161.66590.83711.18791.12560.5647
SGI 1.42221.06461.23381.24370.69531.40361.39661.01130.91110.8902
DEPI 1.04410.99150.92120.34491.3312.480.88310.71921.0990.6141
SGAI 0.80491.00121.05490.84421.71310.7870.86491.1440.99631.0115
LVGI 0.90981.05590.97191.0771.03741.0270.84351.23220.83841.1428
TATA -0.0925-0.0784-0.098-0.2177-0.1598-0.0851-0.1031-0.1071-0.1237-0.2479
M-score -2.46-2.65-2.71-3.70-3.12-2.07-2.58-2.92-2.97-4.22

Apache Corporation Quarterly Data

Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15
DSRI 1.13321.06711.04990.86070.96880.88310.75460.88740.86120.894
GMI 1.22071.29980.90430.89860.90890.84271.01171.02891.03841.0701
AQI 1.02451.03591.12561.10661.33611.26240.56470.65450.72880.8426
SGI 0.97960.97180.91110.92730.85260.83920.90860.80330.76650.6515
DEPI 1.07081.12361.0991.04450.94780.92470.61410.35410.23280.2095
SGAI 1.03091.00710.99420.98841.05771.06180.98161.06821.14541.2893
LVGI 1.06590.93560.83840.8320.84510.9761.14281.35831.46661.578
TATA -0.1026-0.1117-0.124-0.1272-0.1289-0.1548-0.2478-0.3517-0.6275-0.9124
M-score -2.75-2.76-3.03-3.22-3.12-3.44-4.20-4.73-6.11-7.51
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