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Acuity Brands Inc (NYSE:AYI)
Beneish M-Score
-2.51 (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.

Acuity Brands Inc has a M-score of -2.51 suggests that the company is not a manipulator.

AYI' s 10-Year Beneish M-Score Range
Min: -2.94   Max: -2.25
Current: -2.51

-2.94
-2.25

During the past 13 years, the highest Beneish M-Score of Acuity Brands Inc was -2.25. The lowest was -2.94. And the median was -2.60.


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 Acuity Brands Inc 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 * 0.9817+0.528 * 0.956+0.404 * 0.8675+0.892 * 1.1351+0.115 * 1.038
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0125+4.679 * -0.0152-0.327 * 0.9701
=-2.51

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

This Year (May15) TTM:Last Year (May14) TTM:
Accounts Receivable was $393 Mil.
Revenue was 683.7 + 616.1 + 647.4 + 668.7 = $2,616 Mil.
Gross Profit was 295.6 + 255.7 + 273 + 283.5 = $1,108 Mil.
Total Current Assets was $1,344 Mil.
Total Assets was $2,328 Mil.
Property, Plant and Equipment(Net PPE) was $165 Mil.
Depreciation, Depletion and Amortization(DDA) was $45 Mil.
Selling, General & Admin. Expense(SGA) was $743 Mil.
Total Current Liabilities was $486 Mil.
Long-Term Debt was $354 Mil.
Net Income was 64.5 + 46.4 + 51.1 + 54.8 = $217 Mil.
Non Operating Income was -9.5 + 0.1 + 0.9 + -1.9 = $-10 Mil.
Cash Flow from Operations was 82.7 + 28.8 + 46.7 + 104.3 = $263 Mil.
Accounts Receivable was $353 Mil.
Revenue was 603.9 + 546.2 + 574.7 + 579.8 = $2,305 Mil.
Gross Profit was 243.4 + 215.2 + 237.1 + 237.3 = $933 Mil.
Total Current Assets was $1,070 Mil.
Total Assets was $2,050 Mil.
Property, Plant and Equipment(Net PPE) was $148 Mil.
Depreciation, Depletion and Amortization(DDA) was $43 Mil.
Selling, General & Admin. Expense(SGA) was $646 Mil.
Total Current Liabilities was $409 Mil.
Long-Term Debt was $354 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)
=(392.8 / 2615.9) / (352.5 / 2304.6)
=0.15015865 / 0.15295496
=0.9817

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)
=(255.7 / 2304.6) / (295.6 / 2615.9)
=0.40484249 / 0.42348714
=0.956

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 - (1343.6 + 164.9) / 2327.8) / (1 - (1070 + 148.2) / 2049.8)
=0.35196323 / 0.40569812
=0.8675

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
=2615.9 / 2304.6
=1.1351

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))
=(42.8 / (42.8 + 148.2)) / (45.4 / (45.4 + 164.9))
=0.22408377 / 0.21588207
=1.038

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)
=(742.8 / 2615.9) / (646.3 / 2304.6)
=0.28395581 / 0.28043912
=1.0125

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)
=((353.7 + 486.1) / 2327.8) / ((353.6 + 408.7) / 2049.8)
=0.36076983 / 0.37188994
=0.9701

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
=(216.8 - -10.4 - 262.5) / 2327.8
=-0.0152

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.

Acuity Brands Inc has a M-score of -2.51 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.

Acuity Brands Inc Annual Data

Aug05Aug06Aug07Aug08Aug09Aug10Aug11Aug12Aug13Aug14
DSRI 1.01110.99680.73621.13641.03381.14280.93260.93291.11681.0239
GMI 1.03540.96340.95881.05031.05050.94241.00020.99761.01640.98
AQI 0.93560.97881.06040.95861.60470.87861.04930.91410.93870.864
SGI 1.03261.10141.05750.80080.81780.98161.10381.07691.08041.1457
DEPI 1.0111.01250.81341.10620.88070.94250.95390.98391.02840.976
SGAI 0.97820.97650.99540.82961.02921.11020.98990.97220.99240.9773
LVGI 0.95811.03470.9321.00020.74831.16250.95550.96470.93960.9782
TATA -0.0451-0.0337-0.0582-0.0433-0.0058-0.0601-0.0341-0.0666-0.004-0.0258
M-score -2.64-2.58-2.94-2.68-2.30-2.80-2.58-2.81-2.31-2.51

Acuity Brands Inc Quarterly Data

Feb13May13Aug13Nov13Feb14May14Aug14Nov14Feb15May15
DSRI 1.04971.05171.11681.09310.96051.03341.02390.98941.01870.9817
GMI 1.00971.01351.01630.9960.98960.98960.980.98530.97580.956
AQI 0.90810.93320.93870.9080.90610.87820.8640.87010.86160.8675
SGI 1.0441.05631.08041.12481.13851.13891.14571.12991.13111.1351
DEPI 1.07031.0811.02840.98510.97240.95970.9761.021.02181.038
SGAI 0.98211.00040.99260.98280.97690.95210.97730.98420.99221.0125
LVGI 0.9460.9410.93960.97820.95570.95630.97820.95990.97220.9701
TATA -0.0427-0.0434-0.004-0.0238-0.0195-0.013-0.0252-0.0239-0.0244-0.0152
M-score -2.60-2.58-2.31-2.43-2.51-2.42-2.50-2.53-2.52-2.51
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