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VAALCO Energy Inc (NYSE:EGY)
Beneish M-Score
-10.04 (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.

VAALCO Energy Inc has a M-score of -10.04 suggests that the company is not a manipulator.

EGY' s Beneish M-Score Range Over the Past 10 Years
Min: -12.56   Max: 83.22
Current: -10.04

-12.56
83.22

During the past 13 years, the highest Beneish M-Score of VAALCO Energy Inc was 83.22. The lowest was -12.56. And the median was -2.60.


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 VAALCO Energy 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 * 0.4351+0.528 * 3.3865+0.404 * 1.9472+0.892 * 0.63+0.115 * 0.3151
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.6583+4.679 * -1.6001-0.327 * 3.064
=-10.04

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

This Year (Dec15) TTM:Last Year (Dec14) TTM:
Accounts Receivable was $5.35 Mil.
Revenue was 17.523 + 17.546 + 27.137 + 18.239 = $80.45 Mil.
Gross Profit was 4.064 + 9.687 + 18.27 + -19.131 = $12.89 Mil.
Total Current Assets was $63.74 Mil.
Total Assets was $123.96 Mil.
Property, Plant and Equipment(Net PPE) was $33.37 Mil.
Depreciation, Depletion and Amortization(DDA) was $33.01 Mil.
Selling, General & Admin. Expense(SGA) was $14.83 Mil.
Total Current Liabilities was $66.72 Mil.
Long-Term Debt was $15.00 Mil.
Net Income was -80.779 + -33.668 + -5.204 + -39.005 = $-158.66 Mil.
Non Operating Income was -1.195 + 1.622 + 0.438 + -0.056 = $0.81 Mil.
Cash Flow from Operations was 1.356 + 10.566 + 27.554 + -0.601 = $38.88 Mil.
Accounts Receivable was $19.53 Mil.
Revenue was 23.032 + 24.486 + 52.098 + 28.071 = $127.69 Mil.
Gross Profit was -2.401 + 17.341 + 47.25 + 7.098 = $69.29 Mil.
Total Current Assets was $113.05 Mil.
Total Assets was $248.85 Mil.
Property, Plant and Equipment(Net PPE) was $108.12 Mil.
Depreciation, Depletion and Amortization(DDA) was $20.09 Mil.
Selling, General & Admin. Expense(SGA) was $14.19 Mil.
Total Current Liabilities was $38.54 Mil.
Long-Term Debt was $15.00 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)
=(5.353 / 80.445) / (19.527 / 127.687)
=0.06654236 / 0.15292865
=0.4351

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)
=(9.687 / 127.687) / (4.064 / 80.445)
=0.54263942 / 0.1602337
=3.3865

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 - (63.742 + 33.373) / 123.958) / (1 - (113.05 + 108.124) / 248.849)
=0.21654915 / 0.11121202
=1.9472

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
=80.445 / 127.687
=0.63

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))
=(20.086 / (20.086 + 108.124)) / (33.01 / (33.01 + 33.373))
=0.15666485 / 0.49726587
=0.3151

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)
=(14.829 / 80.445) / (14.194 / 127.687)
=0.18433712 / 0.11116245
=1.6583

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)
=((15 + 66.716) / 123.958) / ((15 + 38.54) / 248.849)
=0.65922329 / 0.21515055
=3.064

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
=(-158.656 - 0.809 - 38.875) / 123.958
=-1.6001

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.

VAALCO Energy Inc has a M-score of -10.04 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.

VAALCO Energy Inc Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
DSRI 1.30431.41110.41612.4011.19330.14731.23011.35812.76210.4351
GMI 0.9941.12140.9421.62910.62830.92791.29531.01661.01741.2587
AQI 2.56610.86141.01160.91140.14884.77461.02460.15515.72831.9472
SGI 1.15761.27171.35570.68011.16631.56490.9280.86680.75430.63
DEPI 1.34170.4191.19280.87271.25770.83981.29641.44520.69510.3151
SGAI 0.76452.63610.99371.30710.66260.89921.21851.10221.6721.6583
LVGI 1.7730.82691.73370.61430.67410.81451.84340.88431.44673.064
TATA -0.1432-0.1302-0.3049-0.1523-0.0317-0.2063-0.3498-0.1045-0.4027-1.6001
M-score -2.27-2.75-4.37-1.83-2.65-2.18-4.08-3.022.70-11.16

VAALCO Energy Inc Quarterly Data

Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15
DSRI 0.78751.35810.08694.17862.75142.7622739.53320.71753.27990.4351
GMI 1.93141.01661.08290.8090.58651.18371.53974.32959.7593.3865
AQI 1.07290.1550.29240.27270.249815.72837.12517.798711.99461.9472
SGI 0.78540.86680.78921.07150.99020.75430.76920.52720.52750.63
DEPI 1.8491.44521.27150.91650.94320.69510.62650.62130.44430.3151
SGAI 1.19271.10211.18930.97541.31551.67191.7962.42382.04011.6583
LVGI 1.71030.88430.91731.25891.32541.44672.5122.20251.90443.064
TATA -0.3212-0.1045-0.1066-0.2352-0.1268-0.4027-0.6456-0.6372-0.9426-1.6001
M-score -4.02-3.02-4.22-1.08-2.162.79675.83-2.323.31-10.04
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