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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.
During the past 13 years, the highest Beneish M-Score of Delhaize Group SA was -2.46. The lowest was -3.96. And the median was -2.79.
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 Delhaize Group SA 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 * 0.8873||+||0.528 * 1.0122||+||0.404 * 1.0044||+||0.892 * 1.025||+||0.115 * 0.9371|
|-||0.172 * SGAI||+||4.679 * TATA||-||0.327 * LVGI|
|-||0.172 * 0.998||+||4.679 * -0.0917||-||0.327 * 0.9907|
|This Year (Dec14) TTM:||Last Year (Dec13) TTM:|
|Accounts Receivable was $739 Mil.|
Revenue was 6789.14919852 + 7038.65979381 + 7164.40217391 + 7081.604426 = $28,074 Mil.
Gross Profit was 1644.88286067 + 1689.43298969 + 1718.75 + 1699.86168741 = $6,753 Mil.
Total Current Assets was $4,877 Mil.
Total Assets was $14,953 Mil.
Property, Plant and Equipment(Net PPE) was $4,951 Mil.
Depreciation, Depletion and Amortization(DDA) was $780 Mil.
Selling, General & Admin. Expense(SGA) was $5,920 Mil.
Total Current Liabilities was $3,921 Mil.
Long-Term Debt was $3,300 Mil.
Net Income was -67.8175092478 + 140.463917526 + -61.1413043478 + 110.650069156 = $122 Mil.
Non Operating Income was -2.46609124538 + 10.3092783505 + 6.79347826087 + 4.14937759336 = $19 Mil.
Cash Flow from Operations was 664.611590629 + 364.690721649 + 277.173913043 + 167.358229599 = $1,474 Mil.
|Accounts Receivable was $812 Mil.
Revenue was 6780.521262 + 7074.76635514 + 6922.16358839 + 6611.39896373 = $27,389 Mil.
Gross Profit was 1659.8079561 + 1699.59946595 + 1680.73878628 + 1628.23834197 = $6,668 Mil.
Total Current Assets was $5,026 Mil.
Total Assets was $15,904 Mil.
Property, Plant and Equipment(Net PPE) was $5,450 Mil.
Depreciation, Depletion and Amortization(DDA) was $796 Mil.
Selling, General & Admin. Expense(SGA) was $5,787 Mil.
Total Current Liabilities was $4,313 Mil.
Long-Term Debt was $3,439 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)|
|=||(738.59432799 / 28073.8155923)||/||(812.07133059 / 27388.8501693)|
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)|
|=||(1689.43298969 / 27388.8501693)||/||(1644.88286067 / 28073.8155923)|
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 - (4876.69543773 + 4950.67817509) / 14953.1442663)||/||(1 - (5026.06310014 + 5449.93141289) / 15903.9780521)|
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))|
|=||(796.45334284 / (796.45334284 + 5449.93141289))||/||(779.704746617 / (779.704746617 + 4950.67817509))|
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)|
|=||(5919.88205384 / 28073.8155923)||/||(5786.9134625 / 27388.8501693)|
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)|
|=||((3299.63008631 + 3921.08508015) / 14953.1442663)||/||((3438.95747599 + 4312.75720165) / 15903.9780521)|
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|
|=||(122.155173086 - 18.7860429594||-||1473.83445492)||/||14953.1442663|
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.
Delhaize Group SA has a M-score of -2.99 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
Delhaize Group SA Annual Data
Delhaize Group SA Quarterly Data