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Cardiovascular Systems Inc (NAS:CSII)
Beneish M-Score
-2.06 (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.

Cardiovascular Systems Inc has a M-score of -2.06 signals that the company is a manipulator.

CSII' s 10-Year Beneish M-Score Range
Min: -4.85   Max: 127.44
Current: -2.06

-4.85
127.44

During the past 13 years, the highest Beneish M-Score of Cardiovascular Systems Inc was 127.44. The lowest was -4.85. And the median was -2.50.


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 Cardiovascular Systems 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 * 1.0912+0.528 * 0.984+0.404 * 0.5193+0.892 * 1.3428+0.115 * 4.0413
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0203+4.679 * -0.0544-0.327 * 0.5624
=-2.06

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

This Year (Sep14) TTM:Last Year (Sep13) TTM:
Accounts Receivable was $22.4 Mil.
Revenue was 41.354 + 39.564 + 34.945 + 32.337 = $148.2 Mil.
Gross Profit was 32.469 + 30.449 + 27.196 + 25.024 = $115.1 Mil.
Total Current Assets was $157.0 Mil.
Total Assets was $182.4 Mil.
Property, Plant and Equipment(Net PPE) was $21.2 Mil.
Depreciation, Depletion and Amortization(DDA) was $1.5 Mil.
Selling, General & Admin. Expense(SGA) was $126.1 Mil.
Total Current Liabilities was $32.0 Mil.
Long-Term Debt was $0.0 Mil.
Net Income was -8.224 + -9.628 + -9.712 + -8.658 = $-36.2 Mil.
Non Operating Income was -0.018 + 0.039 + -0.031 + -0.604 = $-0.6 Mil.
Cash Flow from Operations was -4.474 + -8.542 + -5.808 + -6.87 = $-25.7 Mil.
Accounts Receivable was $15.3 Mil.
Revenue was 29.766 + 28.821 + 26.474 + 25.309 = $110.4 Mil.
Gross Profit was 22.902 + 21.892 + 20.233 + 19.351 = $84.4 Mil.
Total Current Assets was $88.0 Mil.
Total Assets was $95.1 Mil.
Property, Plant and Equipment(Net PPE) was $3.0 Mil.
Depreciation, Depletion and Amortization(DDA) was $1.1 Mil.
Selling, General & Admin. Expense(SGA) was $92.1 Mil.
Total Current Liabilities was $24.0 Mil.
Long-Term Debt was $5.7 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)
=(22.376 / 148.2) / (15.271 / 110.37)
=0.15098516 / 0.13836187
=1.0912

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)
=(30.449 / 110.37) / (32.469 / 148.2)
=0.76450122 / 0.77690958
=0.984

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 - (157.03 + 21.238) / 182.353) / (1 - (87.995 + 3.022) / 95.12)
=0.02240161 / 0.04313499
=0.5193

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
=148.2 / 110.37
=1.3428

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))
=(1.056 / (1.056 + 3.022)) / (1.454 / (1.454 + 21.238))
=0.25895047 / 0.06407545
=4.0413

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)
=(126.13 / 148.2) / (92.066 / 110.37)
=0.85107962 / 0.83415783
=1.0203

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 + 32.015) / 182.353) / ((5.742 + 23.954) / 95.12)
=0.17556607 / 0.31219512
=0.5624

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
=(-36.222 - -0.614 - -25.694) / 182.353
=-0.0544

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.

Cardiovascular Systems Inc has a M-score of -2.06 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.

Cardiovascular Systems Inc Annual Data

Dec05Dec06Dec07Dec08Jun09Jun10Jun11Jun12Jun13Jun14
DSRI 0.34090110.96551.1610.98310.85721.104
GMI 1111.40220.92790.96871.03431.00230.9904
AQI 0.19951.16080.8086357.61890.13151.60170.70620.83070.5096
SGI 36.2543.663400.9641.14821.21521.04711.25951.3149
DEPI 1.60630.32710.54182.52360.91751.01280.80411.17292.9862
SGAI 0.06310.291614.76630.90910.82191.01621.03741.0348
LVGI 3.22910.27360.7754.48820.89470.96770.96680.63430.5299
TATA -0.41810.39030.0360.2665-0.2449-0.0591-0.0709-0.1342-0.0422
M-score 25.581.15-3.26141.41-3.87-2.15-2.90-2.94-2.13

Cardiovascular Systems Inc Quarterly Data

Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14
DSRI 0.98311.04180.90430.96990.85720.89510.96550.99921.1041.0912
GMI 1.03441.031.02531.00841.00231.00591.00110.99780.99040.984
AQI 0.70620.98391.07520.57790.83070.63630.29620.51740.50960.5193
SGI 1.04711.0991.15551.20541.25951.26681.26621.28461.31491.3428
DEPI 0.80410.86010.90711.00181.17291.14021.04441.05722.98624.0413
SGAI 1.01621.03881.03571.04981.03741.0231.03371.05221.03481.0203
LVGI 0.96681.05560.8460.47980.63430.60690.2840.53870.52990.5624
TATA -0.0709-0.1079-0.1232-0.0891-0.1336-0.1161-0.066-0.0656-0.0423-0.0544
M-score -2.90-2.89-2.93-2.75-2.94-2.88-2.63-2.58-2.13-2.06
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