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VAALCO Energy Inc (NYSE:EGY)
Beneish M-Score
-2.15 (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 -2.15 signals that the company is a manipulator.

EGY' s 10-Year Beneish M-Score Range
Min: -7.31   Max: 370.97
Current: -2.15

-7.31
370.97

During the past 13 years, the highest Beneish M-Score of VAALCO Energy Inc was 370.97. The lowest was -7.31. And the median was -2.52.


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 * 2.7514+0.528 * 0.6063+0.404 * 0.2498+0.892 * 0.9902+0.115 * 0.9432
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.3155+4.679 * -0.1268-0.327 * 1.3254
=-2.15

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

This Year (Sep14) TTM:Last Year (Sep13) TTM:
Accounts Receivable was $14.4 Mil.
Revenue was 24.486 + 52.098 + 28.071 + 58.282 = $162.9 Mil.
Gross Profit was 16.743 + 43.957 + 7.098 + 47.17 = $115.0 Mil.
Total Current Assets was $169.2 Mil.
Total Assets was $362.9 Mil.
Property, Plant and Equipment(Net PPE) was $189.6 Mil.
Depreciation, Depletion and Amortization(DDA) was $21.4 Mil.
Selling, General & Admin. Expense(SGA) was $13.9 Mil.
Total Current Liabilities was $56.1 Mil.
Long-Term Debt was $15.0 Mil.
Net Income was 3.109 + 24.712 + -7.038 + 26.376 = $47.2 Mil.
Non Operating Income was 0.164 + -0.125 + -0.291 + 0.057 = $-0.2 Mil.
Cash Flow from Operations was 14.194 + 64.102 + -23.542 + 38.596 = $93.4 Mil.
Accounts Receivable was $5.3 Mil.
Revenue was 37.74 + 29.118 + 44.137 + 53.553 = $164.5 Mil.
Gross Profit was 14.094 + 17.823 + 29.647 + 8.832 = $70.4 Mil.
Total Current Assets was $126.9 Mil.
Total Assets was $273.6 Mil.
Property, Plant and Equipment(Net PPE) was $134.6 Mil.
Depreciation, Depletion and Amortization(DDA) was $14.2 Mil.
Selling, General & Admin. Expense(SGA) was $10.7 Mil.
Total Current Liabilities was $40.4 Mil.
Long-Term Debt was $0.0 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)
=(14.399 / 162.937) / (5.285 / 164.548)
=0.08837158 / 0.03211829
=2.7514

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)
=(43.957 / 164.548) / (16.743 / 162.937)
=0.42781438 / 0.70559787
=0.6063

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 - (169.211 + 189.61) / 362.856) / (1 - (126.873 + 134.569) / 273.621)
=0.01112011 / 0.04451047
=0.2498

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
=162.937 / 164.548
=0.9902

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))
=(14.209 / (14.209 + 134.569)) / (21.362 / (21.362 + 189.61))
=0.09550471 / 0.10125514
=0.9432

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)
=(13.948 / 162.937) / (10.708 / 164.548)
=0.08560364 / 0.06507524
=1.3155

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 + 56.095) / 362.856) / ((0 + 40.448) / 273.621)
=0.19593172 / 0.14782491
=1.3254

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
=(47.159 - -0.195 - 93.35) / 362.856
=-0.1268

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 -2.15 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.

VAALCO Energy Inc Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 92.18880.691.30431.41110.41612.4011.19330.14731.23012.4595
GMI 0.83280.9710.9941.12140.84921.10091.03120.92791.29531.0166
AQI 0.73570.87042.56610.86141.01160.91140.14884.77461.02460.155
SGI 1.57021.50321.15761.27171.35570.68011.16631.56490.9280.8668
DEPI 1.66231.21491.37630.4191.19920.8681.25770.83981.29641.4452
SGAI 0.3541.42340.76452.63610.99371.30710.66260.89921.21851.1022
LVGI 0.58690.48191.7730.82691.73370.61430.67410.81451.84340.8843
TATA 0.0018-0.0698-0.1432-0.1302-0.3049-0.1523-0.0317-0.2063-0.3498-0.1045
M-score 82.06-2.59-2.27-2.75-4.42-2.11-2.44-2.18-4.08-2.01

VAALCO Energy Inc Quarterly Data

Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14
DSRI 0.15580.8291.23010.12.8730.78752.459540.93485.53072.7514
GMI 0.99090.99521.29531.38651.56421.93141.01661.08290.83270.6063
AQI 4.90860.89321.02461.08191.06371.07290.1550.29240.27270.2498
SGI 1.1881.15840.9280.92910.7860.78540.86680.78921.07150.9902
DEPI 1.08421.10881.29641.33371.85311.8491.44521.27150.91650.9432
SGAI 1.21071.02771.21881.17661.26081.19271.10211.18930.97541.3155
LVGI 0.94561.01691.84341.29961.70261.71030.88430.91731.25891.3254
TATA -0.1635-0.1779-0.3498-0.2614-0.2227-0.3212-0.1046-0.1066-0.2352-0.1268
M-score -2.29-3.37-4.08-4.45-1.84-4.02-2.0133.360.18-2.15
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