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Eldorado Gold Corp (NYSE:EGO)
Beneish M-Score
-3.03 (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 -3.03 suggests that the company is not a manipulator.

EGO' s 10-Year Beneish M-Score Range
Min: -11.11   Max: 20.19
Current: -3.03

-11.11
20.19

During the past 13 years, the highest Beneish M-Score of Eldorado Gold Corp was 20.19. The lowest was -11.11. And the median was -2.37.


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 * 1.0986+0.528 * 1.3085+0.404 * 0.6983+0.892 * 0.8779+0.115 * 0.7637
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0605+4.679 * -0.1119-0.327 * 1.047
=-3.03

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

This Year (Mar14) TTM:Last Year (Mar13) TTM:
Accounts Receivable was $90 Mil.
Revenue was 279.87 + 231.741 + 287.254 + 266.929 = $1,066 Mil.
Gross Profit was 99.513 + 80.844 + 126.04 + 105.322 = $412 Mil.
Total Current Assets was $943 Mil.
Total Assets was $7,282 Mil.
Property, Plant and Equipment(Net PPE) was $5,755 Mil.
Depreciation, Depletion and Amortization(DDA) was $158 Mil.
Selling, General & Admin. Expense(SGA) was $88 Mil.
Total Current Liabilities was $202 Mil.
Long-Term Debt was $586 Mil.
Net Income was 31.268 + -687.55 + 36.41 + 43.274 = $-577 Mil.
Non Operating Income was -2.246 + -9.184 + -11.831 + 2.589 = $-21 Mil.
Cash Flow from Operations was 69.437 + 47.566 + 120.261 + 21.454 = $259 Mil.
Accounts Receivable was $94 Mil.
Revenue was 338.068 + 349.962 + 281.839 + 244.191 = $1,214 Mil.
Gross Profit was 170.586 + 180.462 + 148.142 + 114.487 = $614 Mil.
Total Current Assets was $1,129 Mil.
Total Assets was $7,979 Mil.
Property, Plant and Equipment(Net PPE) was $5,933 Mil.
Depreciation, Depletion and Amortization(DDA) was $123 Mil.
Selling, General & Admin. Expense(SGA) was $94 Mil.
Total Current Liabilities was $241 Mil.
Long-Term Debt was $583 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)
=(90.248 / 1065.794) / (93.579 / 1214.06)
=0.08467678 / 0.07707939
=1.0986

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)
=(80.844 / 1214.06) / (99.513 / 1065.794)
=0.50547502 / 0.38630261
=1.3085

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 - (942.55 + 5754.756) / 7281.887) / (1 - (1128.617 + 5932.883) / 7978.82)
=0.08027878 / 0.11496938
=0.6983

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
=1065.794 / 1214.06
=0.8779

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))
=(123.235 / (123.235 + 5932.883)) / (157.526 / (157.526 + 5754.756))
=0.02034884 / 0.02664386
=0.7637

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)
=(87.51 / 1065.794) / (94.001 / 1214.06)
=0.0821078 / 0.07742698
=1.0605

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)
=((585.555 + 201.709) / 7281.887) / ((583.32 + 240.555) / 7978.82)
=0.10811264 / 0.10325775
=1.047

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
=(-576.598 - -20.672 - 258.718) / 7281.887
=-0.1119

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 -3.03 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

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 2.88391.00881.36690.45540.82310.58860.350.71074.13560.5771
GMI 4.2476-2.057-0.1020.7460.9031.15411.15320.88931.0891.204
AQI 0.586934.05470.62350.1550.517811.68761.06010.94461.06030.7115
SGI 0.93940.9412.50582.22811.52751.24372.20711.39511.03970.9795
DEPI 2.10071.33827.91250.11181.34572.5370.38660.92632.17160.7426
SGAI 1.45131.71580.50840.6320.93570.68290.88280.91661.11350.9821
LVGI 0.63718.4790.87470.91020.27062.11620.82610.7431.63821.089
TATA -0.0146-0.06350.0445-0.0638-0.0135-0.0268-0.0257-0.0490.0014-0.1371
M-score 0.856.39-0.40-2.67-2.191.50-2.01-2.610.42-3.59

Eldorado Gold Corp Quarterly Data

Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14
DSRI 0.71071.21951.24491.32344.13561.53521.60641.58890.57711.0986
GMI 0.88190.87190.93351.04371.10751.15351.15391.14761.20911.3085
AQI 0.94460.87960.8690.93171.06031.13391.16161.06760.71150.6983
SGI 1.39511.39481.31181.08911.03971.05011.07761.1270.97950.8779
DEPI 0.92632.02492.11092.23222.17160.9770.87050.75790.74260.7637
SGAI 0.91190.74680.811.00971.11351.14671.0210.86350.98211.0605
LVGI 0.7430.51130.52610.59821.63822.44962.58622.41521.0891.047
TATA -0.049-0.0208-0.0075-0.00520.0014-0.0233-0.0319-0.034-0.1371-0.1119
M-score -2.62-1.82-1.78-1.860.43-2.42-2.39-2.35-3.59-3.03
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