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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.
CH Robinson Worldwide Inc has a M-score of -2.53 suggests that the company is not a manipulator.
During the past 13 years, the highest Beneish M-Score of CH Robinson Worldwide Inc was 0.58. The lowest was -3.06. And the median was -2.40.
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 CH Robinson Worldwide 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 * 1.0011||+||0.528 * 1.0348||+||0.404 * 0.9448||+||0.892 * 1.0809||+||0.115 * 0.9059|
|-||0.172 * SGAI||+||4.679 * TATA||-||0.327 * LVGI|
|-||0.172 * 0.9771||+||4.679 * 0.0033||-||0.327 * 1.3956|
|This Year (Jun14) TTM:||Last Year (Jun13) TTM:|
|Accounts Receivable was $1,700 Mil.|
Revenue was 3502.918 + 3142.585 + 3152.882 + 3316.665 = $13,115 Mil.
Gross Profit was 521.037 + 457.235 + 444.465 + 463.306 = $1,886 Mil.
Total Current Assets was $1,909 Mil.
Total Assets was $3,037 Mil.
Property, Plant and Equipment(Net PPE) was $160 Mil.
Depreciation, Depletion and Amortization(DDA) was $58 Mil.
Selling, General & Admin. Expense(SGA) was $1,197 Mil.
Total Current Liabilities was $1,431 Mil.
Long-Term Debt was $500 Mil.
Net Income was 118.596 + 93.187 + 92.952 + 107.737 = $412 Mil.
Non Operating Income was 0 + -6.131 + -9.289 + 0 = $-15 Mil.
Cash Flow from Operations was 113.928 + 14.44 + 164.848 + 124.658 = $418 Mil.
|Accounts Receivable was $1,571 Mil.
Revenue was 3288.262 + 2994.267 + 2970.876 + 2880.409 = $12,134 Mil.
Gross Profit was 472.602 + 455.722 + 444.632 + 432.67 = $1,806 Mil.
Total Current Assets was $1,783 Mil.
Total Assets was $2,922 Mil.
Property, Plant and Equipment(Net PPE) was $153 Mil.
Depreciation, Depletion and Amortization(DDA) was $49 Mil.
Selling, General & Admin. Expense(SGA) was $1,134 Mil.
Total Current Liabilities was $1,331 Mil.
Long-Term Debt was $0 Mil.
1. DSRI = Days Sales in Receivables Index
A large increase in DSR could be indicative of revenue inflation.
|DSRI||=||(Receivables_t / Revenue_t)||/||(Receivables_t-1 / Revenue_t-1)|
|=||(1699.787 / 13115.05)||/||(1570.886 / 12133.814)|
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.
|=||(GrossProfit_t-1 / Revenue_t-1)||/||(GrossProfit_t / Revenue_t)|
|=||(457.235 / 12133.814)||/||(521.037 / 13115.05)|
3. AQI = Asset Quality Index
AQI is the ratio of asset quality in year t to year t-1.
|AQI||=||(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t)||/||(1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)|
|=||(1 - (1909.201 + 160.268) / 3037.106)||/||(1 - (1782.968 + 153.327) / 2921.545)|
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.
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))|
|=||(48.834 / (48.834 + 153.327))||/||(58.279 / (58.279 + 160.268))|
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)|
|=||(1197.222 / 13115.05)||/||(1133.583 / 12133.814)|
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)|
|=||((500 + 1430.998) / 3037.106)||/||((0 + 1330.987) / 2921.545)|
8. TATA = Total Accruals to Total Assets
Total accruals calculated as the change in working capital accounts other than cash less depreciation.
|=||(NetIncome_t - NonOperatingIncome_t||-||CashFlowsfromOperations_t)||/||TotalAssets_t|
|=||(412.472 - -15.42||-||417.874)||/||3037.106|
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.
CH Robinson Worldwide Inc has a M-score of -2.53 suggests that the company will not be a manipulator.
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
CH Robinson Worldwide Inc Annual Data
CH Robinson Worldwide Inc Quarterly Data