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Ark Restaurants Corp (NAS:ARKR)
Beneish M-Score
-1.99 (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.

Ark Restaurants Corp has a M-score of -1.99 signals that the company is a manipulator.

ARKR' s Beneish M-Score Range Over the Past 10 Years
Min: -10.1   Max: 23.75
Current: -1.99

-10.1
23.75

During the past 13 years, the highest Beneish M-Score of Ark Restaurants Corp was 23.75. The lowest was -10.10. And the median was -2.67.


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 Ark Restaurants 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 * 1.7755+0.528 * 1.0025+0.404 * 1.0056+0.892 * 1.0572+0.115 * 1.0954
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0051+4.679 * -0.0561-0.327 * 1.0844
=-1.99

* 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 $4.1 Mil.
Revenue was 36.109 + 40.581 + 40.375 + 31.548 = $148.6 Mil.
Gross Profit was 5.099 + 7.448 + 8.574 + 2.895 = $24.0 Mil.
Total Current Assets was $14.8 Mil.
Total Assets was $68.2 Mil.
Property, Plant and Equipment(Net PPE) was $31.0 Mil.
Depreciation, Depletion and Amortization(DDA) was $4.4 Mil.
Selling, General & Admin. Expense(SGA) was $11.2 Mil.
Total Current Liabilities was $16.7 Mil.
Long-Term Debt was $7.3 Mil.
Net Income was 0.321 + 2.009 + 3.241 + -0.583 = $5.0 Mil.
Non Operating Income was 0.061 + 0.074 + 0.042 + 0.064 = $0.2 Mil.
Cash Flow from Operations was -0.961 + 4.768 + 5.045 + -0.278 = $8.6 Mil.
Accounts Receivable was $2.2 Mil.
Revenue was 33.359 + 37.071 + 39.11 + 31.037 = $140.6 Mil.
Gross Profit was 5.324 + 6.75 + 7.071 + 3.629 = $22.8 Mil.
Total Current Assets was $14.1 Mil.
Total Assets was $63.5 Mil.
Property, Plant and Equipment(Net PPE) was $28.7 Mil.
Depreciation, Depletion and Amortization(DDA) was $4.6 Mil.
Selling, General & Admin. Expense(SGA) was $10.6 Mil.
Total Current Liabilities was $15.5 Mil.
Long-Term Debt was $5.1 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)
=(4.105 / 148.613) / (2.187 / 140.577)
=0.02762208 / 0.01555731
=1.7755

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)
=(7.448 / 140.577) / (5.099 / 148.613)
=0.16200374 / 0.16160094
=1.0025

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 - (14.839 + 30.951) / 68.24) / (1 - (14.067 + 28.675) / 63.523)
=0.32898593 / 0.32714135
=1.0056

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
=148.613 / 140.577
=1.0572

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))
=(4.577 / (4.577 + 28.675)) / (4.448 / (4.448 + 30.951))
=0.13764586 / 0.12565327
=1.0954

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)
=(11.213 / 148.613) / (10.553 / 140.577)
=0.075451 / 0.07506918
=1.0051

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)
=((7.26 + 16.741) / 68.24) / ((5.12 + 15.484) / 63.523)
=0.35171454 / 0.32435496
=1.0844

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
=(4.988 - 0.241 - 8.574) / 68.24
=-0.0561

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.

Ark Restaurants Corp has a M-score of -1.99 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.

Ark Restaurants Corp Annual Data

Sep06Sep07Sep08Sep09Sep10Sep11Sep12Sep13Sep14Sep15
DSRI 1.02921.00810.99370.77370.98471.5451.0220.75631.04221.0203
GMI 0.85141.0044.22171.27910.98260.9920.81191.090.97530.9779
AQI 0.95020.96680.92361.03041.13661.12190.85391.27621.11370.9858
SGI 1.06061.01881.0840.91721.0241.16241.00830.94621.06711.0467
DEPI 0.98421.13221.08070.87680.91130.85451.19410.92411.06881.0021
SGAI 1.26820.96370.11261.06411.05190.85670.98051.10470.99550.9998
LVGI 1.13821.13390.68231.33511.14930.84711.06881.17471.16460.9505
TATA -0.1617-0.0325-0.0937-0.0941-0.0645-0.1401-0.1521-0.1726-0.1144-0.0924
M-score -3.35-2.64-0.91-3.18-2.80-2.39-3.32-3.48-2.93-2.85

Ark Restaurants Corp Quarterly Data

Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15
DSRI 0.75630.80961.09420.69151.04220.99090.96241.77891.02031.7755
GMI 0.08370.5330.54360.03011.48631.03491.06890.95460.97791.0025
AQI 1.27621.17250.94581.01731.11371.04631.07350.97320.98581.0056
SGI 0.94620.96260.98271.02261.06711.06981.05811.04681.04671.0572
DEPI 0.92410.99011.11291.07431.06881.07340.94780.96341.00211.0954
SGAI -1.8661-8.7557-14.158-0.79970.47240.9641.01811.03090.99971.0051
LVGI 1.17471.14971.18821.2291.16461.17750.89150.91330.95051.0844
TATA -0.1726-0.1772-0.1437-0.151-0.1144-0.1104-0.0923-0.0828-0.0924-0.0561
M-score -3.50-2.07-0.79-3.71-2.57-2.95-2.80-2.13-2.85-1.99
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