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Enbridge Energy Partners LP (NYSE:EEP)
Beneish M-Score
-1.24 (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.

Enbridge Energy Partners LP has a M-score of -1.24 signals that the company is a manipulator.

EEP' s Beneish M-Score Range Over the Past 10 Years
Min: -3.99   Max: 6.84
Current: -1.24

-3.99
6.84

During the past 13 years, the highest Beneish M-Score of Enbridge Energy Partners LP was 6.84. The lowest was -3.99. And the median was -2.47.


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 Enbridge Energy Partners LP 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 * 3.2972+0.528 * 0.6031+0.404 * 0.7557+0.892 * 0.7742+0.115 * 0.9559
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.3772+4.679 * -0.0614-0.327 * 1.0082
=-1.24

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

This Year (Sep15) TTM:Last Year (Sep14) TTM:
Accounts Receivable was $124 Mil.
Revenue was 1267.7 + 1313.1 + 1428.6 + 2071.7 = $6,081 Mil.
Gross Profit was 672.3 + 586.1 + 585.1 + 846 = $2,690 Mil.
Total Current Assets was $563 Mil.
Total Assets was $18,407 Mil.
Property, Plant and Equipment(Net PPE) was $17,006 Mil.
Depreciation, Depletion and Amortization(DDA) was $517 Mil.
Selling, General & Admin. Expense(SGA) was $978 Mil.
Total Current Liabilities was $1,605 Mil.
Long-Term Debt was $7,170 Mil.
Net Income was 82.1 + -97.1 + 140.1 + 214.1 = $339 Mil.
Non Operating Income was 22.5 + 23.3 + 28.9 + 16.1 = $91 Mil.
Cash Flow from Operations was 407.4 + 266.4 + 380.5 + 325.1 = $1,379 Mil.
Accounts Receivable was $49 Mil.
Revenue was 1942.3 + 1871.1 + 2079.6 + 1962 = $7,855 Mil.
Gross Profit was 594.5 + 518.9 + 535.5 + 446.2 = $2,095 Mil.
Total Current Assets was $888 Mil.
Total Assets was $16,947 Mil.
Property, Plant and Equipment(Net PPE) was $15,038 Mil.
Depreciation, Depletion and Amortization(DDA) was $436 Mil.
Selling, General & Admin. Expense(SGA) was $917 Mil.
Total Current Liabilities was $1,712 Mil.
Long-Term Debt was $6,302 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)
=(123.8 / 6081.1) / (48.5 / 7855)
=0.02035816 / 0.00617441
=3.2972

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)
=(586.1 / 7855) / (672.3 / 6081.1)
=0.26672183 / 0.44227196
=0.6031

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 - (562.6 + 17006.4) / 18406.9) / (1 - (888.1 + 15038.1) / 16947.1)
=0.04552097 / 0.0602404
=0.7557

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
=6081.1 / 7855
=0.7742

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))
=(436.4 / (436.4 + 15038.1)) / (517 / (517 + 17006.4))
=0.02820123 / 0.02950341
=0.9559

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)
=(978 / 6081.1) / (917.3 / 7855)
=0.16082617 / 0.11677912
=1.3772

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)
=((7169.8 + 1605) / 18406.9) / ((6301.9 + 1711.5) / 16947.1)
=0.47671254 / 0.47284786
=1.0082

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
=(339.2 - 90.8 - 1379.4) / 18406.9
=-0.0614

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.

Enbridge Energy Partners LP has a M-score of -1.24 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.

Enbridge Energy Partners LP Annual Data

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 1.01381.33070.96140.18880.76751.11557.37340.82210.32690.8357
GMI 1.49260.72391.080.9580.53141.86990.59140.71911.26980.7835
AQI 0.86140.90960.73350.99870.8181.24190.96871.12111.16670.8805
SGI 1.50921.0051.11891.35920.5791.34971.17760.73611.06131.1191
DEPI 0.96811.25871.17850.90010.95370.97011.00041.1371.06841.0082
SGAI 0.791.11081.06410.8691.83870.7821.03851.64171.01570.9243
LVGI 1.06420.9671.03080.90530.99891.14030.94170.96120.85171.0193
TATA -0.0454-0.0087-0.0315-0.0171-0.0473-0.0569-0.0377-0.0272-0.085-0.0288
M-score -2.01-2.37-2.62-2.97-3.76-1.783.15-3.19-3.18-2.81

Enbridge Energy Partners LP Quarterly Data

Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15
DSRI 0.74120.34640.32690.24820.36190.56270.83570.81824.53613.2972
GMI 0.92741.21921.26981.08811.10280.96570.78350.76330.6680.6031
AQI 1.25271.28461.16671.06850.87640.82410.88050.91970.73950.7557
SGI 0.8570.98781.06131.14041.14941.13411.11910.97470.87710.7742
DEPI 1.06811.0751.06841.07721.0611.04221.00820.97340.97440.9559
SGAI 1.30031.1431.01570.97020.95620.88730.92431.03651.12281.3772
LVGI 0.78260.82210.85170.77871.05251.02431.01931.040.97461.0082
TATA -0.0528-0.0736-0.085-0.0721-0.0645-0.0415-0.0288-0.0356-0.0506-0.0614
M-score -3.00-3.16-3.18-3.22-3.23-3.03-2.81-3.020.13-1.24
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