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Assa Abloy AB (OTCPK:ASAZY)
Beneish M-Score
-2.46 (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 -2.48 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: -2.46

-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 * 0.9869+0.528 * 0.9867+0.404 * 0.997+0.892 * 1.0388+0.115 * 0.9554
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0116+4.679 * -0.0024-0.327 * 0.9784
=-2.48

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

This Year (Sep16) TTM:Last Year (Sep15) TTM:
Accounts Receivable was $1,496 Mil.
Revenue was 2112.85766197 + 2154.78727888 + 1905.53277214 + 2154.51270338 = $8,328 Mil.
Gross Profit was 836.820574135 + 846.669797575 + 754.850468859 + 829.54625727 = $3,268 Mil.
Total Current Assets was $3,133 Mil.
Total Assets was $10,905 Mil.
Property, Plant and Equipment(Net PPE) was $932 Mil.
Depreciation, Depletion and Amortization(DDA) was $184 Mil.
Selling, General & Admin. Expense(SGA) was $1,703 Mil.
Total Current Liabilities was $2,741 Mil.
Long-Term Debt was $1,900 Mil.
Net Income was 248.73697413 + 243.96999145 + 196.417008418 + 249.593821376 = $939 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0 Mil.
Cash Flow from Operations was 302.071245209 + 287.080187373 + -66.4316377677 + 442.675834138 = $965 Mil.
Accounts Receivable was $1,459 Mil.
Revenue was 2087.64149703 + 2066.71264201 + 1784.94522985 + 2077.23262856 = $8,017 Mil.
Gross Profit was 807.803105464 + 801.301828125 + 698.553506226 + 796.314016437 = $3,104 Mil.
Total Current Assets was $2,982 Mil.
Total Assets was $10,459 Mil.
Property, Plant and Equipment(Net PPE) was $899 Mil.
Depreciation, Depletion and Amortization(DDA) was $168 Mil.
Selling, General & Admin. Expense(SGA) was $1,620 Mil.
Total Current Liabilities was $2,463 Mil.
Long-Term Debt was $2,086 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)
=(1495.58673559 / 8327.69041637) / (1458.77909131 / 8016.53199744)
=0.17959202 / 0.18197134
=0.9869

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)
=(3103.97245625 / 8016.53199744) / (3267.88709784 / 8327.69041637)
=0.38719642 / 0.39241217
=0.9867

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 - (3133.47633951 + 932.470607542) / 10905.0415538) / (1 - (2981.74733143 + 898.528550425) / 10459.3648024)
=0.6271498 / 0.62901419
=0.997

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
=8327.69041637 / 8016.53199744
=1.0388

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))
=(167.522130908 / (167.522130908 + 898.528550425)) / (183.569195784 / (183.569195784 + 932.470607542))
=0.15714275 / 0.16448266
=0.9554

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)
=(1702.90583919 / 8327.69041637) / (1620.43992952 / 8016.53199744)
=0.20448717 / 0.20213727
=1.0116

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)
=((1899.52057765 + 2740.91266074) / 10905.0415538) / ((2086.20710264 + 2462.73562916) / 10459.3648024)
=0.425531 / 0.43491577
=0.9784

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
=(938.717795374 - 0 - 965.395628952) / 10905.0415538
=-0.0024

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 -2.48 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 local exchange's 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

Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16
DSRI 1.02731.02510.97090.94121.01421.05751.00521.02851.0350.9869
GMI 1.05391.06160.98390.97710.97140.96420.99530.99330.99210.9867
AQI 1.00880.99540.9960.99971.00731.01521.01531.00230.99860.997
SGI 1.10531.11421.09541.04461.01140.98970.9931.02471.03851.0388
DEPI 1.09371.06570.9490.9160.89320.89790.88480.90830.96990.9554
SGAI 0.87290.8690.97670.97930.98030.99060.98090.99380.99741.0116
LVGI 1.00771.01770.94670.92350.9380.94830.96180.99510.99560.9784
TATA -0.0147-0.0090-0.0056-0.0033-0.0077-0.0104-0.0024-0.0062-0.0024
M-score -2.37-2.34-2.42-2.51-2.47-2.48-2.52-2.45-2.45-2.48
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