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Assa Abloy AB (OTCPK:ASAZY)
Beneish M-Score
-2.45 (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.

Assa Abloy AB has a M-score of -2.45 suggests that the company is not a manipulator.

ASAZY' s Beneish M-Score Range Over the Past 10 Years
Min: -3.15   Max: -2.21
Current: -2.45

-3.15
-2.21

During the past 13 years, the highest Beneish M-Score of Assa Abloy AB was -2.21. The lowest was -3.15. And the median was -2.45.


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 Assa Abloy AB 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 * 1.035+0.528 * 0.9921+0.404 * 0.9986+0.892 * 1.0385+0.115 * 0.9699
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9974+4.679 * -0.0062-0.327 * 0.9956
=-2.45

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

This Year (Jun16) TTM:Last Year (Jun15) TTM:
Accounts Receivable was $1,545 Mil.
Revenue was 2154.78727888 + 1905.53277214 + 2154.51270338 + 2087.64149703 = $8,302 Mil.
Gross Profit was 846.669797575 + 754.850468859 + 829.54625727 + 807.803105464 = $3,239 Mil.
Total Current Assets was $3,129 Mil.
Total Assets was $10,987 Mil.
Property, Plant and Equipment(Net PPE) was $949 Mil.
Depreciation, Depletion and Amortization(DDA) was $179 Mil.
Selling, General & Admin. Expense(SGA) was $1,673 Mil.
Total Current Liabilities was $2,974 Mil.
Long-Term Debt was $1,903 Mil.
Net Income was 243.96999145 + 196.417008418 + 249.593821376 + 247.313498847 = $937 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0 Mil.
Cash Flow from Operations was 287.080187373 + -66.4316377677 + 442.675834138 + 342.222594102 = $1,006 Mil.
Accounts Receivable was $1,438 Mil.
Revenue was 2066.71264201 + 1784.94522985 + 2077.23262856 + 2065.43995961 = $7,994 Mil.
Gross Profit was 801.301828125 + 698.553506226 + 796.314016437 + 797.873832431 = $3,094 Mil.
Total Current Assets was $2,950 Mil.
Total Assets was $10,424 Mil.
Property, Plant and Equipment(Net PPE) was $910 Mil.
Depreciation, Depletion and Amortization(DDA) was $165 Mil.
Selling, General & Admin. Expense(SGA) was $1,615 Mil.
Total Current Liabilities was $2,652 Mil.
Long-Term Debt was $1,996 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)
=(1545.34397842 / 8302.47425143) / (1437.69736126 / 7994.33046002)
=0.18613054 / 0.17983962
=1.035

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)
=(3094.04318322 / 7994.33046002) / (3238.86962917 / 8302.47425143)
=0.38702968 / 0.39010896
=0.9921

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 - (3128.9813711 + 949.387666631) / 10987.4402418) / (1 - (2949.92317278 + 909.82783444) / 10423.9410548)
=0.62881536 / 0.62972248
=0.9986

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
=8302.47425143 / 7994.33046002
=1.0385

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))
=(165.442867257 / (165.442867257 + 909.82783444)) / (179.010447039 / (179.010447039 + 949.387666631))
=0.1538616 / 0.15864121
=0.9699

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)
=(1672.59012935 / 8302.47425143) / (1614.66122912 / 7994.33046002)
=0.20145683 / 0.20197579
=0.9974

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)
=((1903.2308563 + 2974.00142095) / 10987.4402418) / ((1995.69283632 + 2652.0513472) / 10423.9410548)
=0.44389159 / 0.44587207
=0.9956

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
=(937.29432009 - 0 - 1005.54697785) / 10987.4402418
=-0.0062

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.

Assa Abloy AB has a M-score of -2.45 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.

Assa Abloy AB Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
DSRI 0.94890.93671.10850.87830.94581.09040.97831.08551.05920.9277
GMI 1.12930.87461.10310.98880.93591.12560.90551.04160.98410.995
AQI 1.0310.97231.00781.04331.06981.03291.02851.01180.9961.0153
SGI 1.3021.13810.83911.12681.09721.13431.15981.04971.00411.076
DEPI 0.89791.02651.08470.86740.99631.01740.97821.15831.02640.8226
SGAI 0.96260.9810.98750.99180.94390.97411.00741.00910.96390.9932
LVGI 1.06870.96690.980.96220.89951.09921.00120.98280.94670.9618
TATA -0.0341-0.0136-0.0435-0.0774-0.037-0.027-0.0138-0.0221-0.003-0.0102
M-score -2.36-2.54-2.65-2.83-2.58-2.35-2.46-2.41-2.42-2.53

Assa Abloy AB Quarterly Data

Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16
DSRI 1.06271.02731.02510.97090.94121.01421.05751.00521.02851.035
GMI 1.05021.05391.06160.98390.97710.97140.96420.99530.99330.9921
AQI 1.00811.00880.99540.9960.99971.00731.01521.01531.00230.9986
SGI 1.09821.10531.11421.09541.04461.01140.98970.9931.02471.0385
DEPI 1.11971.09371.06570.9490.9160.89320.89790.88480.90830.9699
SGAI 0.87010.87290.8690.97670.97930.98030.99060.98090.99380.9974
LVGI 1.02091.00771.01770.94670.92350.9380.94830.96180.99510.9956
TATA -0.0123-0.0147-0.0090-0.0056-0.0033-0.0077-0.0104-0.0024-0.0062
M-score -2.33-2.37-2.34-2.42-2.51-2.47-2.48-2.52-2.45-2.45
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