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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 * 1.1689+0.528 * 1.0252+0.404 * 1.0033+0.892 * 1.1549+0.115 * 1.0528
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0053+4.679 * 0.0733-0.327 * 1.2548
=-1.91

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

This Year (Jan14) TTM:Last Year (Jan13) TTM:
Accounts Receivable was $217.7 Mil.
Revenue was 181.27 + 192.218 + 185.427 + 176.452 = $735.4 Mil.
Gross Profit was 72.154 + 85.281 + 85.66 + 80.676 = $323.8 Mil.
Total Current Assets was $299.4 Mil.
Total Assets was $427.6 Mil.
Property, Plant and Equipment(Net PPE) was $67.1 Mil.
Depreciation, Depletion and Amortization(DDA) was $21.0 Mil.
Selling, General & Admin. Expense(SGA) was $185.5 Mil.
Total Current Liabilities was $136.3 Mil.
Long-Term Debt was $16.4 Mil.
Net Income was 2.954 + 11.121 + 14.701 + 11.338 = $40.1 Mil.
Non Operating Income was -0.03 + 0.56 + 1.046 + -0.104 = $1.5 Mil.
Cash Flow from Operations was -2.752 + 0.687 + 4.143 + 5.218 = $7.3 Mil.
Accounts Receivable was $161.3 Mil.
Revenue was 161.256 + 163.488 + 160.532 + 151.443 = $636.7 Mil.
Gross Profit was 70.922 + 74.681 + 74.279 + 67.534 = $287.4 Mil.
Total Current Assets was $233.0 Mil.
Total Assets was $331.9 Mil.
Property, Plant and Equipment(Net PPE) was $51.6 Mil.
Depreciation, Depletion and Amortization(DDA) was $17.3 Mil.
Selling, General & Admin. Expense(SGA) was $159.7 Mil.
Total Current Liabilities was $81.4 Mil.
Long-Term Debt was $13.0 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)
=(217.741 / 735.367) / (161.289 / 636.719)
=0.29609841 / 0.25331269
=1.1689

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)
=(85.281 / 636.719) / (72.154 / 735.367)
=0.45140164 / 0.44028492
=1.0252

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 - (299.408 + 67.113) / 427.636) / (1 - (233.049 + 51.569) / 331.895)
=0.1429136 / 0.14244565
=1.0033

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
=735.367 / 636.719
=1.1549

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))
=(17.258 / (17.258 + 51.569)) / (20.981 / (20.981 + 67.113))
=0.25074462 / 0.23816605
=1.0528

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)
=(185.452 / 735.367) / (159.725 / 636.719)
=0.25218972 / 0.25085634
=1.0053

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)
=((16.38 + 136.295) / 427.636) / ((13.01 + 81.425) / 331.895)
=0.35702092 / 0.28453276
=1.2548

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
=(40.114 - 1.472 - 7.296) / 427.636
=0.0733

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 0.99621.07771.08290.97870.90630.93010.97370.94010.94131.1557
GMI 0.97041.01580.97790.99561.03210.99011.00211.01691.07640.9988
AQI 0.91780.8911.32260.83630.98360.90850.95680.82211.06771.1665
SGI 1.2491.20351.17841.29671.20221.20451.2631.21971.09961.1646
DEPI 1.21420.86250.89431.18940.98810.98081.07150.94851.03171.0742
SGAI 0.6881.50470.98550.98510.97770.61961.02190.96621.06770.9838
LVGI 1.01740.96261.03341.0410.90860.90991.00970.88550.82881.2847
TATA 0.2910.06610.06080.0661-0.0081-0.02090.0532-0.0044-0.03390.0654
M-score -0.88-2.04-1.86-1.98-2.38-2.41-2.04-2.39-2.49-1.90

Bio-Reference Laboratories Inc Quarterly Data

Oct11Jan12Apr12Jul12Oct12Jan13Apr13Jul13Oct13Jan14
DSRI 0.94010.94380.91330.87990.94130.98771.0661.13981.15571.1689
GMI 1.01691.02781.03951.05431.07641.05461.03071.01210.99881.0252
AQI 0.82210.84611.0271.09331.06771.28541.03180.96961.16651.0033
SGI 1.21971.19851.16141.12761.09961.10581.12241.14041.16461.1549
DEPI 0.94850.94820.98451.01081.03170.97530.97891.00671.07421.0528
SGAI 0.96620.98131.01271.04831.06771.04631.00660.98260.98381.0053
LVGI 0.88550.88190.86080.79640.82880.86690.95481.10481.28471.2548
TATA -0.0044-0.0069-0.0244-0.0539-0.0339-0.01780.01070.03550.06350.0733
M-score -2.39-2.40-2.46-2.60-2.49-2.30-2.22-2.10-1.91-1.91
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