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Empire District Electric Co (NYSE:EDE)
Beneish M-Score
-2.74 (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.

Empire District Electric Co has a M-score of -2.74 suggests that the company is not a manipulator.

EDE' s Beneish M-Score Range Over the Past 10 Years
Min: -5.09   Max: -1.5
Current: -2.74

-5.09
-1.5

During the past 13 years, the highest Beneish M-Score of Empire District Electric Co was -1.50. The lowest was -5.09. And the median was -2.74.


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 Empire District Electric Co 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 * 1.3395+0.528 * 1.0331+0.404 * 0.9788+0.892 * 0.9719+0.115 * 1.0564
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 2.7935+4.679 * -0.0565-0.327 * 0.9694
=-2.74

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

This Year (Sep16) TTM:Last Year (Sep15) TTM:
Accounts Receivable was $66.7 Mil.
Revenue was 175.354 + 139.32 + 151.315 + 136.758 = $602.7 Mil.
Gross Profit was 101.474 + 100.337 + 78.069 + 18.67 = $298.6 Mil.
Total Current Assets was $177.8 Mil.
Total Assets was $2,476.6 Mil.
Property, Plant and Equipment(Net PPE) was $2,049.0 Mil.
Depreciation, Depletion and Amortization(DDA) was $85.3 Mil.
Selling, General & Admin. Expense(SGA) was $9.6 Mil.
Total Current Liabilities was $139.6 Mil.
Long-Term Debt was $829.6 Mil.
Net Income was 27.505 + 9.225 + 14.009 + 9.905 = $60.6 Mil.
Non Operating Income was -0.07 + 0.818 + 1.332 + 3.747 = $5.8 Mil.
Cash Flow from Operations was 73.212 + 30.976 + 51.375 + 39.142 = $194.7 Mil.
Accounts Receivable was $51.2 Mil.
Revenue was 169.714 + 134.557 + 164.544 + 151.363 = $620.2 Mil.
Gross Profit was 94.181 + 93.363 + 75.593 + 54.228 = $317.4 Mil.
Total Current Assets was $200.8 Mil.
Total Assets was $2,462.8 Mil.
Property, Plant and Equipment(Net PPE) was $2,008.3 Mil.
Depreciation, Depletion and Amortization(DDA) was $88.5 Mil.
Selling, General & Admin. Expense(SGA) was $3.5 Mil.
Total Current Liabilities was $131.3 Mil.
Long-Term Debt was $863.0 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)
=(66.708 / 602.747) / (51.239 / 620.178)
=0.1106733 / 0.08261983
=1.3395

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)
=(317.365 / 620.178) / (298.55 / 602.747)
=0.51173212 / 0.49531561
=1.0331

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 - (177.834 + 2048.97) / 2476.557) / (1 - (200.798 + 2008.307) / 2462.843)
=0.10084686 / 0.10302646
=0.9788

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
=602.747 / 620.178
=0.9719

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))
=(88.527 / (88.527 + 2008.307)) / (85.295 / (85.295 + 2048.97))
=0.04221937 / 0.03996458
=1.0564

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)
=(9.562 / 602.747) / (3.522 / 620.178)
=0.01586404 / 0.00567901
=2.7935

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)
=((829.626 + 139.55) / 2476.557) / ((862.999 + 131.28) / 2462.843)
=0.39134007 / 0.40371189
=0.9694

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
=(60.644 - 5.827 - 194.705) / 2476.557
=-0.0565

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.

Empire District Electric Co has a M-score of -2.74 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 local exchange's currency.

Empire District Electric Co Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
DSRI 0.92330.89451.01941.06650.82230.92211.13660.65471.6233
GMI 0.88991.0020.92740.95210.93730.97741.14581.07230.9233
AQI 1.19260.91351.02390.96751.09041.01550.74441.06090.9406
SGI 1.13631.18920.95951.08871.06580.96571.06681.09760.9283
DEPI 1.05730.86361.02580.91340.92341.1761.04640.94730.9862
SGAI 2.761300.993715.53971.05381.03170.06620.03250
LVGI 1.010.98430.93010.92020.94090.97611.03481.03240.9847
TATA -0.0235-0.05-0.0511-0.0479-0.0388-0.0483-0.046-0.0392-0.0546
M-score -2.82-2.51-2.74-5.09-2.76-2.79-2.38-2.68-2.12

Empire District Electric Co Quarterly Data

Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16
DSRI 0.89720.91320.65470.78281.62331.33851.40561.3395
GMI 1.16251.24340.98770.75190.90390.87930.97941.0331
AQI 0.72280.70771.06091.12130.94060.96670.98240.9788
SGI 1.1041.13171.09760.95410.92830.92960.960.9719
DEPI 0.92870.9330.94730.97610.98621.05161.08971.0564
SGAI 00.3345-7.10340.2671-0.4206-0.77445.79652.7934
LVGI 1.06051.06231.03240.98010.98470.99040.96810.9694
TATA -0.0406-0.0431-0.0387-0.0493-0.0546-0.0537-0.057-0.0565
M-score -2.55-2.55-1.50-2.90-2.05-2.25-3.23-2.74
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