Xref (ASX:XF1) Beneish M-Score : -2.52 (As of Jun. 14, 2024)

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What is Xref Beneish M-Score?

The zones of discrimination for M-Score is as such:

An M-Score of equal or less than -1.78 suggests that the company is unlikely to be a manipulator.
An M-Score of greater than -1.78 signals that the company is likely to be a manipulator.

Good Sign:

Beneish M-Score -2.52 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

The historical rank and industry rank for Xref's Beneish M-Score or its related term are showing as below:

ASX:XF1' s Beneish M-Score Range Over the Past 10 Years
Min: -4.6 Med: -2.89 Max: -0.82
Current: -2.52

During the past 13 years, the highest Beneish M-Score of Xref was -0.82. The lowest was -4.60. And the median was -2.89.

Xref Beneish M-Score Historical Data

The historical data trend for Xref's Beneish M-Score can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

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Xref Beneish M-Score Chart

Xref Annual Data

Trend

Mar14

Mar15

Jun16

Jun17

Jun18

Jun19

Jun20

Jun21

Jun22

Jun23

Beneish M-Score

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-3.80

-0.82

-2.89

-3.08

-2.52

Xref Semi-Annual Data
	Mar14	Sep14	Mar15	Sep15	Jun16	Dec16	Jun17	Dec17	Jun18	Dec18	Jun19	Dec19	Jun20	Dec20	Jun21	Dec21	Jun22	Dec22	Jun23	Dec23
Beneish M-Score	Get a 7-Day Free Trial															-	-3.08	-	-2.52	-

Competitive Comparison of Xref's Beneish M-Score

For the Software - Application subindustry, Xref's Beneish M-Score, along with its competitors' market caps and Beneish M-Score data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

Xref's Beneish M-Score Distribution in the Software Industry

For the Software industry and Technology sector, Xref's Beneish M-Score distribution charts can be found below:

* The bar in red indicates where Xref's Beneish M-Score falls into.

Xref Beneish M-Score Calculation

The M-score was created by Professor Messod Beneish. Instead of measuring the bankruptcy risk (Altman Z-Score) or business trend (Piotroski 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 Xref for today is based on a combination of the following eight different indices:

-4.84

0.92 * DSRI

0.528 * GMI

0.404 * AQI

0.892 * SGI

0.115 * DEPI

-4.84

0.92 * 1.3362

0.528 * 0.9546

0.404 * 2.1478

0.892 * 1.0973

0.115 * 0.8575

0.172 * SGAI

4.679 * TATA

0.327 * LVGI

0.172 * 1.2893

4.679 * -0.169483

0.327 * 1.0426

-2.52

This Year (Jun23) TTM:

Last Year (Jun22) TTM:

Total Receivables was A$2.77 Mil.
Revenue was A$20.40 Mil.
Gross Profit was A$17.15 Mil.
Total Current Assets was A$11.67 Mil.
Total Assets was A$22.90 Mil.
Property, Plant and Equipment(Net PPE) was A$1.17 Mil.
Depreciation, Depletion and Amortization(DDA) was A$1.37 Mil.
Selling, General, & Admin. Expense(SGA) was A$17.80 Mil.
Total Current Liabilities was A$17.39 Mil.
Long-Term Debt & Capital Lease Obligation was A$4.48 Mil.
Net Income was A$-3.36 Mil.
Gross Profit was A$0.07 Mil.
Cash Flow from Operations was A$0.45 Mil.

Total Receivables was A$1.89 Mil.
Revenue was A$18.59 Mil.
Gross Profit was A$14.92 Mil.
Total Current Assets was A$15.49 Mil.
Total Assets was A$20.17 Mil.
Property, Plant and Equipment(Net PPE) was A$0.55 Mil.
Depreciation, Depletion and Amortization(DDA) was A$0.47 Mil.
Selling, General, & Admin. Expense(SGA) was A$12.58 Mil.
Total Current Liabilities was A$14.07 Mil.
Long-Term Debt & Capital Lease Obligation was A$4.41 Mil.

1. DSRI = Days Sales in Receivables Index

Measured as the ratio of Revenue in Total 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)
	=	(2.774 / 20.399)	/	(1.892 / 18.591)
	=	0.135987	/	0.10177
	=	1.3362

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)
	=	(14.917 / 18.591)	/	(17.147 / 20.399)
	=	0.802377	/	0.84058
	=	0.9546

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 Property, Plant and Equipment to Total Assets.

AQI	=	(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t)	/	(1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)
	=	(1 - (11.666 + 1.167) / 22.899)	/	(1 - (15.494 + 0.551) / 20.174)
	=	0.439583	/	0.204669
	=	2.1478

4. SGI = Sales Growth Index

Ratio of Revenue 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
	=	20.399	/	18.591
	=	1.0973

5. DEPI = Depreciation Index

Measured as the ratio of the rate of Depreciation, Depletion and Amortization 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))
	=	(0.474 / (0.474 + 0.551))	/	(1.366 / (1.366 + 1.167))
	=	0.462439	/	0.539281
	=	0.8575

Note: If the Depreciation, Depletion and Amortization data is not available, we assume that the depreciation rate is constant and set the Depreciation Index to 1.

6. SGAI = Sales, General and Administrative expenses Index

The ratio of Selling, General, & Admin. Expense(SGA) to Sales 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)
	=	(17.797 / 20.399)	/	(12.58 / 18.591)
	=	0.872445	/	0.676672
	=	1.2893

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 in leverage

LVGI	=	((LTD_t + CurrentLiabilities_t) / TotalAssets_t)	/	((LTD_t-1 + CurrentLiabilities_t-1) / TotalAssets_t-1)
	=	((4.482 + 17.385) / 22.899)	/	((4.406 + 14.071) / 20.174)
	=	0.954933	/	0.915882
	=	1.0426

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
	=	(-3.359 - 0.068	-	0.454)	/	22.899
	=	-0.169483

An M-Score of equal or less than -1.78 suggests that the company is unlikely to be a manipulator. An M-Score of greater than -1.78 signals that the company is likely to be a manipulator.

Xref has a M-score of -2.52 suggests that the company is unlikely to be a manipulator.

Xref Beneish M-Score Related Terms

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Xref (ASX:XF1) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Technology » Software » Xref Ltd (ASX:XF1) » Definitions » Beneish M-Score

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Traded in Other Exchanges

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Address

13 Hickson Road, Suite 13, Level 3, Dawes Point, Sydney, NSW, AUS, 2000

Website

https://www.xref.com

Xref Ltd is a human resources technology company that automates the candidate reference process for employers. It is involved in leveraging databases to provide predictive analytics that enables human resource directors to make data-driven decisions. The company transforms the phone-based, manual procedure into a cloud-based, electronic process. It requests referee information from the candidate and gathers other information, analyses the candidate, and provides the report. Geographically, it derives a majority of its revenue from Australia and also has a presence in Canada; the United Kingdom; Norway; New Zealand, and the United States.

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