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Apache Corp (NYSE:APA)
Beneish M-Score
-8.17 (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 Corp has a M-score of -8.17 suggests that the company is not a manipulator.

APA' s Beneish M-Score Range Over the Past 10 Years
Min: -8.94   Max: -0.64
Current: -8.17

-8.94
-0.64

During the past 13 years, the highest Beneish M-Score of Apache Corp was -0.64. The lowest was -8.94. And the median was -2.76.


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 Corp 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 * 1.3135+0.528 * 1.1591+0.404 * 1.6631+0.892 * 0.4826+0.115 * 0.4783
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 2.2643+4.679 * -1.1333-0.327 * 1.8716
=-8.17

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

This Year (Mar16) TTM:Last Year (Mar15) TTM:
Accounts Receivable was $1,120 Mil.
Revenue was 1052 + 1263 + 1496 + 1977 = $5,788 Mil.
Gross Profit was 622 + 807 + 988 + 1461 = $3,878 Mil.
Total Current Assets was $3,222 Mil.
Total Assets was $17,679 Mil.
Property, Plant and Equipment(Net PPE) was $13,542 Mil.
Depreciation, Depletion and Amortization(DDA) was $22,047 Mil.
Selling, General & Admin. Expense(SGA) was $448 Mil.
Total Current Liabilities was $1,598 Mil.
Long-Term Debt was $8,718 Mil.
Net Income was -489 + -7213 + -5655 + -5600 = $-18,957 Mil.
Non Operating Income was -54 + -1601 + 62 + 61 = $-1,532 Mil.
Cash Flow from Operations was 276 + 262 + 789 + 1283 = $2,610 Mil.
Accounts Receivable was $1,767 Mil.
Revenue was 1818 + 2952 + 3740 + 3484 = $11,994 Mil.
Gross Profit was 1224 + 2265 + 3021 + 2805 = $9,315 Mil.
Total Current Assets was $5,906 Mil.
Total Assets was $48,650 Mil.
Property, Plant and Equipment(Net PPE) was $41,230 Mil.
Depreciation, Depletion and Amortization(DDA) was $17,359 Mil.
Selling, General & Admin. Expense(SGA) was $410 Mil.
Total Current Liabilities was $5,493 Mil.
Long-Term Debt was $9,675 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)
=(1120 / 5788) / (1767 / 11994)
=0.1935038 / 0.14732366
=1.3135

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)
=(807 / 11994) / (622 / 5788)
=0.77663832 / 0.67000691
=1.1591

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 - (3222 + 13542) / 17679) / (1 - (5906 + 41230) / 48650)
=0.05175632 / 0.03112025
=1.6631

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
=5788 / 11994
=0.4826

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))
=(17359 / (17359 + 41230)) / (22047 / (22047 + 13542))
=0.29628429 / 0.61948917
=0.4783

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)
=(448 / 5788) / (410 / 11994)
=0.07740152 / 0.03418376
=2.2643

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)
=((8718 + 1598) / 17679) / ((9675 + 5493) / 48650)
=0.58351717 / 0.31177801
=1.8716

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
=(-18957 - -1532 - 2610) / 17679
=-1.1333

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 Corp has a M-score of -8.17 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 Corp Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
DSRI 1.04620.97420.5671.630.98361.03310.99111.01760.79471.347
GMI 1.03221.00720.98171.0530.96730.98671.02441.02190.98731.1306
AQI 1.17451.17141.17130.93191.66520.83711.18791.12560.56471.9736
SGI 1.09291.20381.23550.69881.40361.39661.01130.940.86280.4596
DEPI 0.9940.92120.34491.33092.48010.88310.71921.03880.64970.2583
SGAI 0.97531.08120.84981.7040.78730.86491.1441.00771.00013.6096
LVGI 1.05590.97191.0771.03741.0270.84351.23220.83841.14282.1149
TATA -0.0653-0.1001-0.2198-0.1705-0.0847-0.1061-0.107-0.1263-0.2479-1.2688
M-score -2.59-2.73-3.71-3.06-2.08-2.60-3.02-2.99-4.22-9.02

Apache Corp Quarterly Data

Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16
DSRI 1.01760.84730.95340.86370.79470.93020.92881.02281.30831.3135
GMI 1.02191.00040.99270.97840.98731.02641.0531.12331.17231.1591
AQI 1.12561.10661.33611.26240.56470.65450.72880.84261.97361.6631
SGI 0.940.94190.86640.85810.86280.76620.71080.56950.47320.4826
DEPI 1.03881.01930.91390.92930.64970.36880.2490.22040.25830.4783
SGAI 1.00771.03511.03661.00721.03691.05751.28641.55792.03822.2643
LVGI 0.83840.8320.84510.9761.14281.35831.46661.5782.11491.8716
TATA -0.1246-0.1282-0.1299-0.1549-0.2479-0.3527-0.6307-0.9188-1.3093-1.1333
M-score -2.98-3.18-3.08-3.36-4.23-4.73-6.12-7.52-8.94-8.17
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