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BlackRock Inc (NYSE:BLK)
Beneish M-Score
-2.45 (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.

BlackRock Inc has a M-score of -2.45 suggests that the company is not a manipulator.

BLK' s 10-Year Beneish M-Score Range
Min: -5.11   Max: -0.89
Current: -2.45

-5.11
-0.89

During the past 13 years, the highest Beneish M-Score of BlackRock Inc was -0.89. The lowest was -5.11. And the median was -2.54.


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 BlackRock 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 * 0.9237+0.528 * 0.9998+0.404 * 1.0042+0.892 * 1.0705+0.115 * 1.0964
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9712+4.679 * 0.0017-0.327 * 0.9624
=-2.45

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

This Year (Mar15) TTM:Last Year (Mar14) TTM:
Accounts Receivable was $2,836 Mil.
Revenue was 2723 + 2784 + 2849 + 2778 = $11,134 Mil.
Gross Profit was 2624 + 2688 + 2759 + 2689 = $10,760 Mil.
Total Current Assets was $7,408 Mil.
Total Assets was $242,714 Mil.
Property, Plant and Equipment(Net PPE) was $537 Mil.
Depreciation, Depletion and Amortization(DDA) was $268 Mil.
Selling, General & Admin. Expense(SGA) was $6,065 Mil.
Total Current Liabilities was $2,398 Mil.
Long-Term Debt was $8,902 Mil.
Net Income was 822 + 813 + 917 + 808 = $3,360 Mil.
Non Operating Income was 98 + -8 + -1 + 73 = $162 Mil.
Cash Flow from Operations was -490 + 1271 + 1284 + 732 = $2,797 Mil.
Accounts Receivable was $2,868 Mil.
Revenue was 2670 + 2777 + 2472 + 2482 = $10,401 Mil.
Gross Profit was 2581 + 2690 + 2387 + 2392 = $10,050 Mil.
Total Current Assets was $7,453 Mil.
Total Assets was $216,297 Mil.
Property, Plant and Equipment(Net PPE) was $508 Mil.
Depreciation, Depletion and Amortization(DDA) was $292 Mil.
Selling, General & Admin. Expense(SGA) was $5,834 Mil.
Total Current Liabilities was $2,283 Mil.
Long-Term Debt was $8,180 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)
=(2836 / 11134) / (2868 / 10401)
=0.25471529 / 0.27574272
=0.9237

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)
=(2688 / 10401) / (2624 / 11134)
=0.96625324 / 0.9664092
=0.9998

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 - (7408 + 537) / 242714) / (1 - (7453 + 508) / 216297)
=0.967266 / 0.96319413
=1.0042

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
=11134 / 10401
=1.0705

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))
=(292 / (292 + 508)) / (268 / (268 + 537))
=0.365 / 0.33291925
=1.0964

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)
=(6065 / 11134) / (5834 / 10401)
=0.54472786 / 0.56090761
=0.9712

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)
=((8902 + 2398) / 242714) / ((8180 + 2283) / 216297)
=0.04655685 / 0.0483733
=0.9624

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
=(3360 - 162 - 2797) / 242714
=0.0017

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.

BlackRock Inc 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.

BlackRock Inc Annual Data

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 0.5550.69742.05440.66550.88721.11650.9160.8668
GMI 00.99491.0190.54070.99490.99630.99550.9981
AQI 0.99870.83411.16521.00550.99990.99591.00540.9974
SGI 2.30941.04520.92811.83231.05451.02821.09031.0885
DEPI 0.59160.89941.35770.83431.17451.0330.97090.9557
SGAI 0.90370.82591.25393.08720.9930.98391.00830.9623
LVGI 1.72883.1280.36320.85561.18411.11420.85661.0153
TATA -0.0043-0.0281-0.0032-0.0032-0.00290.0005-0.00460.0004
M-score -2.54-3.60-1.31-2.63-2.59-2.38-2.46-2.53

BlackRock Inc Quarterly Data

Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15
DSRI 1.11651.07430.98441.58820.9161.00451.7120.54790.86680.9237
GMI 0.99630.99650.99540.99390.99550.99590.99610.9970.99810.9998
AQI 0.99590.99351.0010.99771.005410.98950.99960.99741.0042
SGI 1.02821.0541.09631.10161.09031.09061.09261.11391.08851.0705
DEPI 1.0330.99170.95410.96730.97090.97870.96990.93240.95571.0964
SGAI 0.98390.9861.00321.01051.00830.99990.95910.95830.96230.9712
LVGI 1.11421.16110.91040.97930.85660.94481.15110.97431.01530.9624
TATA 0.0005-0.0008-0.0014-0.0012-0.0046-0.00220.00030.00060.00040.0017
M-score -2.38-2.42-2.39-1.86-2.46-2.39-1.79-2.79-2.53-2.45
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