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Aspen Technology Inc (NAS:AZPN)
Beneish M-Score
-4.05 (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.

Aspen Technology Inc has a M-score of -4.05 suggests that the company is not a manipulator.

AZPN' s 10-Year Beneish M-Score Range
Min: -4.97   Max: -1.33
Current: -4.05

-4.97
-1.33

During the past 13 years, the highest Beneish M-Score of Aspen Technology Inc was -1.33. The lowest was -4.97. And the median was -2.96.


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 Aspen Technology 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 * 0.5391+0.528 * 0.9636+0.404 * 0.456+0.892 * 1.2774+0.115 * 1.0495
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.7865+4.679 * -0.2448-0.327 * 1.1707
=-4.05

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

This Year (Mar14) TTM:Last Year (Mar13) TTM:
Accounts Receivable was $34.6 Mil.
Revenue was 103.587 + 98.769 + 87.565 + 83.264 = $373.2 Mil.
Gross Profit was 88.299 + 86.326 + 75.487 + 70.276 = $320.4 Mil.
Total Current Assets was $318.4 Mil.
Total Assets was $383.0 Mil.
Property, Plant and Equipment(Net PPE) was $7.2 Mil.
Depreciation, Depletion and Amortization(DDA) was $5.0 Mil.
Selling, General & Admin. Expense(SGA) was $144.1 Mil.
Total Current Liabilities was $242.5 Mil.
Long-Term Debt was $0.0 Mil.
Net Income was 20.843 + 23.263 + 14.999 + 20.399 = $79.5 Mil.
Non Operating Income was -0.472 + -0.531 + -0.804 + -0.765 = $-2.6 Mil.
Cash Flow from Operations was 69.633 + 46.343 + 25.913 + 33.938 = $175.8 Mil.
Accounts Receivable was $50.2 Mil.
Revenue was 79.357 + 77.309 + 71.457 + 64.017 = $292.1 Mil.
Gross Profit was 66.708 + 64.936 + 59.119 + 50.916 = $241.7 Mil.
Total Current Assets was $235.5 Mil.
Total Assets was $361.7 Mil.
Property, Plant and Equipment(Net PPE) was $7.2 Mil.
Depreciation, Depletion and Amortization(DDA) was $5.4 Mil.
Selling, General & Admin. Expense(SGA) was $143.4 Mil.
Total Current Liabilities was $195.6 Mil.
Long-Term Debt was $0.0 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)
=(34.556 / 373.185) / (50.182 / 292.14)
=0.09259751 / 0.17177381
=0.5391

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)
=(86.326 / 292.14) / (88.299 / 373.185)
=0.82727117 / 0.85852325
=0.9636

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 - (318.42 + 7.167) / 383.03) / (1 - (235.549 + 7.176) / 361.661)
=0.14996998 / 0.32886045
=0.456

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
=373.185 / 292.14
=1.2774

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))
=(5.408 / (5.408 + 7.176)) / (4.97 / (4.97 + 7.167))
=0.42975207 / 0.40949164
=1.0495

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)
=(144.075 / 373.185) / (143.4 / 292.14)
=0.38606857 / 0.49086055
=0.7865

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)
=((0 + 242.499) / 383.03) / ((0 + 195.578) / 361.661)
=0.63310707 / 0.54077714
=1.1707

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
=(79.504 - -2.572 - 175.827) / 383.03
=-0.2448

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.

Aspen Technology Inc has a M-score of -4.05 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.

Aspen Technology Inc Annual Data

Jun04Jun05Jun06Jun07Jun08Jun09Jun10Jun11Jun12Jun13
DSRI 0.74650.90560.95522.17461.14860.82811.35530.64010.69840.5676
GMI 0.93331.06760.90070.92520.99780.96111.25570.81890.93740.9364
AQI 0.86660.98681.05710.99151.01181.07670.87221.06350.73760.8634
SGI 0.96110.81081.08611.16290.91370.99990.53391.19121.2271.2807
DEPI 0.85050.8510.96351.37521.35170.81511.06061.01411.03191.0703
SGAI 0.57711.34250.79660.9861.16910.92322.10810.78480.81570.7443
LVGI 0.87011.07510.85711.36690.81490.78911.13410.86921.19731.0594
TATA -0.1806-0.3378-0.0064-0.0179-0.08880.0421-0.364-0.1359-0.312-0.2617
M-score -3.58-4.39-2.43-1.46-2.76-2.37-4.42-3.26-4.18-3.91

Aspen Technology Inc Quarterly Data

Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14
DSRI 0.68790.70450.69840.57470.60770.52070.56760.66280.45580.5391
GMI 0.87040.91740.93740.92110.93740.92540.93640.95290.95380.9636
AQI 1.04341.02050.73760.7370.71181.08790.86340.7170.67690.456
SGI 1.26171.26131.2271.27671.22911.26051.28071.24351.2731.2774
DEPI 0.86160.84791.03191.17131.18311.16971.07031.0140.98091.0495
SGAI 0.79830.80070.81570.74590.77880.74540.74430.79530.77190.7865
LVGI 0.89560.9661.19731.10031.15441.09971.05941.10911.1671.1707
TATA -0.1067-0.1452-0.312-0.3356-0.3493-0.3136-0.2617-0.263-0.2602-0.2448
M-score -3.03-3.21-4.18-4.31-4.41-4.13-3.91-3.94-4.13-4.05
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