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ECB Bancorp Inc (AMEX:ECBE)
Beneish M-Score
0.00 (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.

ECB Bancorp Inc has a M-score of -2.44 suggests that the company is not a manipulator.

During the past 13 years, the highest Beneish M-Score of ECB Bancorp Inc was 0.00. The lowest was 0.00. And the median was 0.00.


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 ECB Bancorp 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 * 0.9724+0.528 * 1+0.404 * 1.0005+0.892 * 1.0193+0.115 * 0.9548
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.1672+4.679 * -0.0095-0.327 * 0.6248
=-2.44

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

This Year (Sep12) TTM:Last Year (Sep11) TTM:
Accounts Receivable was $4.93 Mil.
Revenue was 12.329 + 8.879 + 8.267 + 8.797 = $38.27 Mil.
Gross Profit was 12.329 + 8.879 + 8.267 + 8.797 = $38.27 Mil.
Total Current Assets was $0.00 Mil.
Total Assets was $927.59 Mil.
Property, Plant and Equipment(Net PPE) was $25.77 Mil.
Depreciation, Depletion and Amortization(DDA) was $1.49 Mil.
Selling, General & Admin. Expense(SGA) was $19.44 Mil.
Total Current Liabilities was $0.00 Mil.
Long-Term Debt was $16.00 Mil.
Net Income was 1.649 + 0.588 + 0.377 + -1.612 = $1.00 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0.00 Mil.
Cash Flow from Operations was 4.505 + 3.452 + 0.714 + 1.177 = $9.85 Mil.
Accounts Receivable was $4.97 Mil.
Revenue was 9.191 + 9.584 + 8.199 + 10.575 = $37.55 Mil.
Gross Profit was 9.191 + 9.584 + 8.199 + 10.575 = $37.55 Mil.
Total Current Assets was $0.00 Mil.
Total Assets was $923.70 Mil.
Property, Plant and Equipment(Net PPE) was $26.14 Mil.
Depreciation, Depletion and Amortization(DDA) was $1.44 Mil.
Selling, General & Admin. Expense(SGA) was $16.34 Mil.
Total Current Liabilities was $0.00 Mil.
Long-Term Debt was $25.50 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)
=(4.928 / 38.272) / (4.972 / 37.549)
=0.12876254 / 0.13241365
=0.9724

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)
=(37.549 / 37.549) / (38.272 / 38.272)
=1 / 1
=1

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 - (0 + 25.773) / 927.592) / (1 - (0 + 26.137) / 923.695)
=0.97221515 / 0.97170386
=1.0005

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
=38.272 / 37.549
=1.0193

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))
=(1.437 / (1.437 + 26.137)) / (1.488 / (1.488 + 25.773))
=0.05211431 / 0.05458347
=0.9548

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)
=(19.442 / 38.272) / (16.342 / 37.549)
=0.5079954 / 0.43521798
=1.1672

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 + 0) / 927.592) / ((25.5 + 0) / 923.695)
=0.01724896 / 0.02760652
=0.6248

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
=(1.002 - 0 - 9.848) / 927.592
=-0.0095

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.

ECB Bancorp Inc has a M-score of -2.44 suggests that the company will not 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.

ECB Bancorp Inc Annual Data

Dec02Dec03Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11
DSRI 0.81691.01061.00671.10891.21460.970.8150.93611.1297
GMI 111111111
AQI 1.00420.99490.99340.99930.99740.99891.00210.99951.0004
SGI 1.19021.11821.04491.16431.06760.99461.3071.12760.8962
DEPI 0.4750.85021.5521.16021.16780.92781.05461.03870.9418
SGAI 0.95410.98091.04150.99581.03631.07131.2931.00391.2318
LVGI 2.58030.81350.92580.53590.494200.76511.58720.738
TATA 0.00050.0004-0.0032-0.0017-0.0061-0.002-0.002-0.0074-0.013
M-score -3.04-2.32-2.37-2.07-2.07-2.22-2.35-2.65-2.47

ECB Bancorp Inc Quarterly Data

Jun10Sep10Dec10Mar11Jun11Sep11Dec11Mar12Jun12Sep12
DSRI 0.79630.81160.93610.98540.93061.00531.12971.11211.24310.9724
GMI 1111111111
AQI 1.00151.00190.99950.99880.9990.99951.00041.00051.00081.0005
SGI 1.27511.25491.12761.03681.04220.95550.89620.93210.89781.0193
DEPI 1.06041.06881.03870.99660.99370.9360.94180.97370.95050.9548
SGAI 1.21481.30521.00391.07291.091.11341.23181.23661.26371.1672
LVGI 0.65721.51341.58721.85761.8570.74590.7380.65480.65260.6248
TATA -0.0034-0.004-0.0074-0.0142-0.0147-0.0123-0.013-0.0041-0.006-0.0095
M-score -2.36-2.66-2.65-2.82-2.87-2.52-2.47-2.39-2.31-2.44
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