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Eldorado Gold Corp (NYSE:EGO)
Beneish M-Score
-2.52 (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.

Eldorado Gold Corp has a M-score of -2.73 suggests that the company is not a manipulator.

EGO' s Beneish M-Score Range Over the Past 10 Years
Min: -15.08   Max: 16.64
Current: -2.52

-15.08
16.64

During the past 13 years, the highest Beneish M-Score of Eldorado Gold Corp was 16.64. The lowest was -15.08. And the median was -2.61.


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 Eldorado Gold Corp 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 * 1.036+0.528 * 1.3179+0.404 * 1.0445+0.892 * 0.887+0.115 * 0.9195
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9183+4.679 * -0.0739-0.327 * 1.0724
=-2.73

* 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 $74.5 Mil.
Revenue was 211.516 + 214.185 + 238.311 + 259.022 = $923.0 Mil.
Gross Profit was 47.985 + 57.771 + 67.387 + 77.443 = $250.6 Mil.
Total Current Assets was $676.6 Mil.
Total Assets was $7,108.2 Mil.
Property, Plant and Equipment(Net PPE) was $5,822.8 Mil.
Depreciation, Depletion and Amortization(DDA) was $178.7 Mil.
Selling, General & Admin. Expense(SGA) was $75.1 Mil.
Total Current Liabilities was $220.2 Mil.
Long-Term Debt was $588.8 Mil.
Net Income was -96.091 + -198.6 + -8.244 + 13.916 = $-289.0 Mil.
Non Operating Income was 0.768 + 1.706 + 1.244 + -7.733 = $-4.0 Mil.
Cash Flow from Operations was 52.563 + 53.93 + 75.006 + 58.886 = $240.4 Mil.
Accounts Receivable was $81.0 Mil.
Revenue was 263.51 + 265.497 + 279.87 + 231.741 = $1,040.6 Mil.
Gross Profit was 93.089 + 98.878 + 99.513 + 80.844 = $372.3 Mil.
Total Current Assets was $872.9 Mil.
Total Assets was $7,347.5 Mil.
Property, Plant and Equipment(Net PPE) was $5,872.2 Mil.
Depreciation, Depletion and Amortization(DDA) was $165.3 Mil.
Selling, General & Admin. Expense(SGA) was $92.2 Mil.
Total Current Liabilities was $193.1 Mil.
Long-Term Debt was $586.7 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)
=(74.463 / 923.034) / (81.035 / 1040.618)
=0.080672 / 0.077872
=1.036

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)
=(57.771 / 1040.618) / (47.985 / 923.034)
=0.35779124 / 0.27148079
=1.3179

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 - (676.622 + 5822.828) / 7108.231) / (1 - (872.875 + 5872.154) / 7347.523)
=0.08564452 / 0.08199961
=1.0445

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
=923.034 / 1040.618
=0.887

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))
=(165.267 / (165.267 + 5872.154)) / (178.661 / (178.661 + 5822.828))
=0.02737377 / 0.02976945
=0.9195

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)
=(75.093 / 923.034) / (92.192 / 1040.618)
=0.08135453 / 0.08859351
=0.9183

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)
=((588.846 + 220.151) / 7108.231) / ((586.652 + 193.14) / 7347.523)
=0.1138113 / 0.10612992
=1.0724

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
=(-289.019 - -4.015 - 240.385) / 7108.231
=-0.0739

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.

Eldorado Gold Corp has a M-score of -2.73 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.

Eldorado Gold Corp Annual Data

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 1.00881.36690.45540.82310.58860.1240.69747.26420.41320.9674
GMI -2.057-0.1020.7460.97641.06741.22110.83991.0891.2041.2697
AQI 34.05470.62350.1550.517811.68761.06010.94461.06030.71150.9682
SGI 0.9412.50582.22811.52751.24372.20711.39511.03970.97950.9501
DEPI 1.33827.91250.11181.34572.5370.38660.92632.17160.74260.8854
SGAI 1.71580.50840.6320.93570.68290.88280.91661.11350.98211.0331
LVGI 8.4790.87470.91020.27062.11620.82610.7431.63821.0890.949
TATA -0.06350.0445-0.0638-0.0135-0.0268-0.0257-0.0490.0014-0.1362-0.0236
M-score 6.39-0.40-2.67-2.151.45-2.18-2.653.30-3.74-2.54

Eldorado Gold Corp Quarterly Data

Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15
DSRI 1.60641.58890.41321.09860.91170.9750.96740.94491.12591.036
GMI 0.96920.9590.97451.01761.5521.59471.56881.53851.25561.3179
AQI 1.16161.06760.71150.69830.71030.73390.96821.00081.02931.0445
SGI 1.07761.1270.97950.87790.86060.83770.95010.9630.91610.887
DEPI 0.87050.75790.74260.76370.77910.86630.88540.92780.95360.9195
SGAI 1.0210.86350.98211.06051.13791.24261.03311.04980.98160.9183
LVGI 2.58622.41521.0891.0471.05981.04360.9490.96831.08431.0724
TATA -0.0319-0.034-0.136-0.1108-0.1165-0.1164-0.0236-0.0302-0.0632-0.0739
M-score -2.49-2.45-3.86-3.18-3.12-3.06-2.38-2.43-2.62-2.73
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