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Aspen Technology Inc (NAS:AZPN)
Beneish M-Score
-4.03 (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 -4.03 suggests that the company is not a manipulator.

AZPN' s 10-Year Beneish M-Score Range
Min: -4.67   Max: -1.33
Current: -4.03

-4.67
-1.33

During the past 13 years, the highest Beneish M-Score of Aspen Technology Inc was -1.33. The lowest was -4.67. And the median was -2.95.


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 * 0.616+0.528 * 0.9687+0.404 * 0.7406+0.892 * 1.2571+0.115 * 0.9831
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.7828+4.679 * -0.2747-0.327 * 1.1604
=-4.03

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

This Year (Jun14) TTM:Last Year (Jun13) TTM:
Accounts Receivable was $40.8 Mil.
Revenue was 101.532 + 103.587 + 98.769 + 87.565 = $391.5 Mil.
Gross Profit was 88.653 + 88.299 + 86.326 + 75.487 = $338.8 Mil.
Total Current Assets was $329.7 Mil.
Total Assets was $408.0 Mil.
Property, Plant and Equipment(Net PPE) was $7.6 Mil.
Depreciation, Depletion and Amortization(DDA) was $5.2 Mil.
Selling, General & Admin. Expense(SGA) was $140.6 Mil.
Total Current Liabilities was $266.5 Mil.
Long-Term Debt was $0.0 Mil.
Net Income was 26.678 + 20.843 + 23.263 + 14.999 = $85.8 Mil.
Non Operating Income was -0.471 + -0.472 + -0.531 + -0.804 = $-2.3 Mil.
Cash Flow from Operations was 58.242 + 69.633 + 46.343 + 25.913 = $200.1 Mil.
Accounts Receivable was $52.7 Mil.
Revenue was 83.264 + 79.357 + 77.309 + 71.457 = $311.4 Mil.
Gross Profit was 70.276 + 66.708 + 64.936 + 59.119 = $261.0 Mil.
Total Current Assets was $285.4 Mil.
Total Assets was $382.7 Mil.
Property, Plant and Equipment(Net PPE) was $7.8 Mil.
Depreciation, Depletion and Amortization(DDA) was $5.2 Mil.
Selling, General & Admin. Expense(SGA) was $142.9 Mil.
Total Current Liabilities was $215.5 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)
=(40.828 / 391.453) / (52.722 / 311.387)
=0.1042986 / 0.16931343
=0.616

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)
=(88.299 / 311.387) / (88.653 / 391.453)
=0.83831053 / 0.86540402
=0.9687

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 - (329.682 + 7.588) / 407.972) / (1 - (285.351 + 7.829) / 382.748)
=0.17330111 / 0.23401298
=0.7406

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
=391.453 / 311.387
=1.2571

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))
=(5.229 / (5.229 + 7.829)) / (5.215 / (5.215 + 7.588))
=0.40044417 / 0.40732641
=0.9831

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)
=(140.646 / 391.453) / (142.928 / 311.387)
=0.35929218 / 0.45900439
=0.7828

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 + 266.504) / 407.972) / ((0 + 215.461) / 382.748)
=0.65324091 / 0.56293175
=1.1604

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
=(85.783 - -2.278 - 200.131) / 407.972
=-0.2747

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 -4.03 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 0.69560.77631.21741.98961.14860.82811.35530.64010.69840.5676
GMI 0.96731.07020.90040.92520.99780.96111.25570.81890.93740.9364
AQI 0.87730.97910.98911.0551.01181.05610.88931.06350.73760.8634
SGI 1.00920.82771.08791.16290.91370.99990.53391.19121.2271.2807
DEPI 0.83870.86550.94321.38971.35170.98940.87371.01411.03191.0703
SGAI 0.91191.33860.79630.9861.16910.9552.03790.78480.81570.7443
LVGI 0.86191.07180.9041.31240.81490.78911.13410.86921.19731.0594
TATA -0.1875-0.3367-0.0064-0.0179-0.08880.0413-0.364-0.1359-0.312-0.2617
M-score -3.65-4.48-2.23-1.58-2.76-2.37-4.42-3.26-4.18-3.91

Aspen Technology Inc Quarterly Data

Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14
DSRI 0.70450.69840.57470.60770.52070.56760.66280.45580.53910.616
GMI 0.91740.93740.92110.93740.92540.93640.95290.95380.96360.9687
AQI 1.02050.73760.7370.71181.08790.86340.7170.67690.4560.7406
SGI 1.26131.2271.27671.22911.26051.28071.24351.2731.27741.2571
DEPI 0.84791.03191.17131.18311.16971.07031.0140.98091.04950.9831
SGAI 0.80070.81570.74590.77880.74540.74430.79530.77190.78650.7828
LVGI 0.9661.19731.10031.15441.09971.05941.10911.1671.17071.1604
TATA -0.1452-0.312-0.3356-0.3493-0.3136-0.2617-0.263-0.2602-0.2448-0.2747
M-score -3.21-4.18-4.31-4.41-4.13-3.91-3.94-4.13-4.05-4.03
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