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

-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 -2.44.


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 * 1.0285+0.528 * 0.9933+0.404 * 1.0023+0.892 * 1.0247+0.115 * 0.9083
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9938+4.679 * -0.0024-0.327 * 0.9951
=-2.45

* 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 $1,406 Mil.
Revenue was 1905.53277214 + 2154.51270338 + 2087.64149703 + 2066.71264201 = $8,214 Mil.
Gross Profit was 754.850468859 + 829.54625727 + 807.803105464 + 801.301828125 = $3,194 Mil.
Total Current Assets was $2,938 Mil.
Total Assets was $10,528 Mil.
Property, Plant and Equipment(Net PPE) was $918 Mil.
Depreciation, Depletion and Amortization(DDA) was $177 Mil.
Selling, General & Admin. Expense(SGA) was $1,648 Mil.
Total Current Liabilities was $2,583 Mil.
Long-Term Debt was $1,879 Mil.
Net Income was 196.417008418 + 249.593821376 + 247.313498847 + 228.424860562 = $922 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0 Mil.
Cash Flow from Operations was -66.4316377677 + 442.675834138 + 342.222594102 + 228.182885074 = $947 Mil.
Accounts Receivable was $1,334 Mil.
Revenue was 1784.94522985 + 2077.23262856 + 2065.43995961 + 2088.57446268 = $8,016 Mil.
Gross Profit was 698.553506226 + 796.314016437 + 797.873832431 + 802.883680582 = $3,096 Mil.
Total Current Assets was $2,790 Mil.
Total Assets was $10,165 Mil.
Property, Plant and Equipment(Net PPE) was $948 Mil.
Depreciation, Depletion and Amortization(DDA) was $163 Mil.
Selling, General & Admin. Expense(SGA) was $1,619 Mil.
Total Current Liabilities was $2,398 Mil.
Long-Term Debt was $1,931 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)
=(1405.97644915 / 8214.39961456) / (1334.02771276 / 8016.19228069)
=0.17115998 / 0.16641663
=1.0285

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)
=(829.54625727 / 8016.19228069) / (754.850468859 / 8214.39961456)
=0.3861715 / 0.38876872
=0.9933

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 - (2938.34088783 + 918.171571096) / 10528.4552846) / (1 - (2790.4690572 + 947.944948975) / 10165.1296695)
=0.63370577 / 0.63223155
=1.0023

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
=8214.39961456 / 8016.19228069
=1.0247

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))
=(162.820472067 / (162.820472067 + 947.944948975)) / (176.694144309 / (176.694144309 + 918.171571096))
=0.14658403 / 0.16138431
=0.9083

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)
=(1648.33256966 / 8214.39961456) / (1618.63216381 / 8016.19228069)
=0.20066379 / 0.20192033
=0.9938

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)
=((1878.79223925 + 2583.15945991) / 10528.4552846) / ((1930.64787941 + 2398.41775115) / 10165.1296695)
=0.42379927 / 0.42587412
=0.9951

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
=(921.749189202 - 0 - 946.649675546) / 10528.4552846
=-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 -2.45 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 0.94891.01271.09970.8190.94581.09040.97831.08551.05920.9277
GMI 1.12930.87461.07291.01670.93591.12560.90551.04160.98410.995
AQI 1.0310.97231.00781.04331.06981.03291.02851.01180.9961.0153
SGI 1.3021.13810.84121.12391.09721.13431.15981.04971.00411.076
DEPI 0.89791.02651.08470.86740.99631.01740.97821.15831.02640.8226
SGAI 0.96260.9811.0370.94450.94390.97411.00741.00910.96390.9932
LVGI 1.06870.90431.03490.97430.89951.09921.00120.98280.94670.9618
TATA -0.0341-0.0133-0.0429-0.0766-0.037-0.027-0.0146-0.0221-0.003-0.0102
M-score -2.36-2.45-2.70-2.87-2.58-2.35-2.47-2.41-2.42-2.53

Assa Abloy AB Quarterly Data

Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16
DSRI 1.05851.06271.02731.02510.97090.94121.01421.05751.00521.0285
GMI 1.04161.05021.05391.06160.98390.97710.97140.96420.99530.9933
AQI 1.01531.00811.00880.99540.9960.99971.00731.01521.01531.0023
SGI 1.07651.09821.10531.11421.09541.04461.01140.98970.9931.0247
DEPI 1.13241.11971.09371.06570.9490.9160.89320.89790.88480.9083
SGAI 0.87890.87010.87290.8690.97670.97930.98030.99060.98090.9938
LVGI 0.82891.02091.00771.01770.94670.92350.9380.94830.96180.9951
TATA -0.022-0.0123-0.0147-0.0090-0.0056-0.0033-0.0077-0.0104-0.0024
M-score -2.34-2.33-2.37-2.34-2.42-2.51-2.47-2.48-2.52-2.45
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