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Bio-Reference Laboratories Inc (NAS:BRLI)
Beneish M-Score
-1.91 (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.

Bio-Reference Laboratories Inc has a M-score of -1.91 signals that the company is a manipulator.

BRLI' s 10-Year Beneish M-Score Range
Min: -3.23   Max: -0.77
Current: -1.91

-3.23
-0.77

During the past 13 years, the highest Beneish M-Score of Bio-Reference Laboratories Inc was -0.77. The lowest was -3.23. And the median was -2.21.


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 Bio-Reference Laboratories 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 * 1.1521+0.528 * 1.0615+0.404 * 1.0762+0.892 * 1.1398+0.115 * 0.9058
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0562+4.679 * 0.0662-0.327 * 1.1381
=-1.91

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

This Year (Jul14) TTM:Last Year (Jul13) TTM:
Accounts Receivable was $251.9 Mil.
Revenue was 222.053 + 201.366 + 181.27 + 192.218 = $796.9 Mil.
Gross Profit was 102.443 + 88.549 + 72.154 + 85.281 = $348.4 Mil.
Total Current Assets was $337.7 Mil.
Total Assets was $466.1 Mil.
Property, Plant and Equipment(Net PPE) was $65.8 Mil.
Depreciation, Depletion and Amortization(DDA) was $24.2 Mil.
Selling, General & Admin. Expense(SGA) was $202.9 Mil.
Total Current Liabilities was $150.2 Mil.
Long-Term Debt was $15.3 Mil.
Net Income was 15.25 + 10.273 + 2.954 + 11.121 = $39.6 Mil.
Non Operating Income was 0.09 + -0.056 + -0.03 + 0.56 = $0.6 Mil.
Cash Flow from Operations was 7.693 + 2.564 + -2.752 + 0.687 = $8.2 Mil.
Accounts Receivable was $191.8 Mil.
Revenue was 185.427 + 176.452 + 161.256 + 176.052 = $699.2 Mil.
Gross Profit was 85.66 + 80.676 + 70.922 + 87.245 = $324.5 Mil.
Total Current Assets was $273.4 Mil.
Total Assets was $378.5 Mil.
Property, Plant and Equipment(Net PPE) was $57.8 Mil.
Depreciation, Depletion and Amortization(DDA) was $18.6 Mil.
Selling, General & Admin. Expense(SGA) was $168.6 Mil.
Total Current Liabilities was $105.0 Mil.
Long-Term Debt was $13.1 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)
=(251.851 / 796.907) / (191.798 / 699.187)
=0.31603562 / 0.27431574
=1.1521

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)
=(88.549 / 699.187) / (102.443 / 796.907)
=0.46411475 / 0.43722417
=1.0615

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 - (337.661 + 65.84) / 466.122) / (1 - (273.383 + 57.843) / 378.473)
=0.13434466 / 0.12483585
=1.0762

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
=796.907 / 699.187
=1.1398

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))
=(18.603 / (18.603 + 57.843)) / (24.185 / (24.185 + 65.84))
=0.24334825 / 0.2686476
=0.9058

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)
=(202.927 / 796.907) / (168.575 / 699.187)
=0.25464326 / 0.24110145
=1.0562

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)
=((15.276 + 150.225) / 466.122) / ((13.064 + 105.012) / 378.473)
=0.35505941 / 0.31197998
=1.1381

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
=(39.598 - 0.564 - 8.192) / 466.122
=0.0662

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.

Bio-Reference Laboratories Inc has a M-score of -1.91 signals that the company is likely to 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.

Bio-Reference Laboratories Inc Annual Data

Oct04Oct05Oct06Oct07Oct08Oct09Oct10Oct11Oct12Oct13
DSRI 0.99621.07771.08290.97870.90630.93010.97370.94010.87391.2449
GMI 0.97041.01580.97790.99561.03210.99011.00211.01690.98981.0861
AQI 0.91780.8911.32260.83630.98360.90850.95680.82211.06771.1665
SGI 1.2491.20351.17841.29671.20221.20451.2631.21971.18441.0811
DEPI 1.21420.86250.89431.18940.98810.98081.07150.94851.03171.0742
SGAI 0.6881.50470.98550.98510.97770.61961.02190.96620.99121.0597
LVGI 0.98970.96261.03341.0410.90860.90991.00970.88550.82881.2847
TATA 0.2910.06610.06080.0661-0.0081-0.02090.0532-0.0044-0.03390.0654
M-score -0.87-2.04-1.86-1.98-2.38-2.41-2.04-2.39-2.51-1.86

Bio-Reference Laboratories Inc Quarterly Data

Apr12Jul12Oct12Jan13Apr13Jul13Oct13Jan14Apr14Jul14
DSRI 0.87890.83180.87390.95261.06841.18411.24491.23551.19661.1521
GMI 0.99690.99060.98981.01041.03081.05441.08611.09241.08561.0615
AQI 1.0271.09331.06771.28541.03180.96961.16651.00330.99691.0762
SGI 1.20681.19281.18441.14671.11991.09781.08111.09271.10821.1398
DEPI 0.98451.01081.03170.97530.97891.00671.07421.05280.98060.9058
SGAI 0.97460.99090.99121.0091.00891.02081.05971.06261.06141.0562
LVGI 0.86080.79640.82880.86690.95481.10481.28471.25481.22331.1381
TATA -0.0244-0.0539-0.0339-0.01780.01070.03550.06350.07330.07280.0662
M-score -2.46-2.61-2.51-2.32-2.22-2.08-1.87-1.88-1.90-1.91
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