EPAM Systems Beneish M-Score Historical Data
The historical data trend for EPAM Systems's Beneish M-Score can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
EPAM Systems Beneish M-Score Chart
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EPAM Systems Annual Data
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Trend |
Dec14 |
Dec15 |
Dec16 |
Dec17 |
Dec18 |
Dec19 |
Dec20 |
Dec21 |
Dec22 |
Dec23 |
| Beneish M-Score |
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-2.47 |
-2.84 |
-1.92 |
-2.21 |
-2.54 |
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EPAM Systems Quarterly Data
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Mar19 |
Jun19 |
Sep19 |
Dec19 |
Mar20 |
Jun20 |
Sep20 |
Dec20 |
Mar21 |
Jun21 |
Sep21 |
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Mar22 |
Jun22 |
Sep22 |
Dec22 |
Mar23 |
Jun23 |
Sep23 |
Dec23 |
| Beneish M-Score |
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-2.21 |
-2.50 |
-2.52 |
-2.50 |
-2.54 |
Competitive Comparison of EPAM Systems's Beneish M-Score
For the Information Technology Services subindustry, EPAM Systems's Beneish M-Score, along with its competitors' market caps and Beneish M-Score data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
EPAM Systems's Beneish M-Score Distribution in the Software Industry
For the Software industry and Technology sector, EPAM Systems's Beneish M-Score distribution charts can be found below:
* The bar in red indicates where EPAM Systems's Beneish M-Score falls into.
EPAM Systems Beneish M-Score Calculation
The M-score was created by Professor Messod Beneish. Instead of measuring the bankruptcy risk (Altman Z-Score) or business trend (Piotroski 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 EPAM Systems 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 * 0.9893 | + | 0.528 * 1.0427 | + | 0.404 * 0.992 | + | 0.892 * 0.9722 | + | 0.115 * 0.9436 |
| - | 0.172 * SGAI | + | 4.679 * TATA | - | 0.327 * LVGI |
| - | 0.172 * 0.9606 | + | 4.679 * -0.023861 | - | 0.327 * 0.8009 |
| = | -2.54 |
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
| This Year (Dec23) TTM: | Last Year (Dec22) TTM: |
Total Receivables was $897 Mil.
Revenue was 1157.257 + 1152.136 + 1170.206 + 1210.941 = $4,691 Mil.
Gross Profit was 359.624 + 357.871 + 361.491 + 355.04 = $1,434 Mil.
Total Current Assets was $3,091 Mil.
Total Assets was $4,352 Mil.
Property, Plant and Equipment(Net PPE) was $370 Mil.
Depreciation, Depletion and Amortization(DDA) was $133 Mil.
Selling, General, & Admin. Expense(SGA) was $815 Mil.
Total Current Liabilities was $645 Mil.
Long-Term Debt & Capital Lease Obligation was $135 Mil.
Net Income was 97.554 + 97.204 + 120.033 + 102.292 = $417 Mil.
Non Operating Income was -9.053 + -22.029 + -6.01 + -4.608 = $-42 Mil.
Cash Flow from Operations was 171.369 + 214.879 + 89.052 + 87.334 = $563 Mil.
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Total Receivables was $933 Mil.
Revenue was 1231.303 + 1226.92 + 1194.861 + 1171.614 = $4,825 Mil.
Gross Profit was 398.575 + 400.124 + 348.538 + 390.778 = $1,538 Mil.
Total Current Assets was $2,760 Mil.
Total Assets was $4,009 Mil.
Property, Plant and Equipment(Net PPE) was $422 Mil.
Depreciation, Depletion and Amortization(DDA) was $140 Mil.
Selling, General, & Admin. Expense(SGA) was $873 Mil.
Total Current Liabilities was $747 Mil.
Long-Term Debt & Capital Lease Obligation was $150 Mil.
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1. DSRI = Days Sales in Receivables Index
Measured as the ratio of Revenue in Total 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) |
| = | (897.032 / 4690.54) | / | (932.626 / 4824.698) |
| = | 0.191243 | / | 0.193302 |
| | = | 0.9893 |
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) |
| = | (1538.015 / 4824.698) | / | (1434.026 / 4690.54) |
| = | 0.31878 | / | 0.305727 |
| | = | 1.0427 |
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 Property, Plant and Equipment to Total Assets.
| AQI | = | (1 - (CurrentAssets_t + PPE_t) / TotalAssets_t) | / | (1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1) |
| = | (1 - (3091.361 + 369.951) / 4352.365) | / | (1 - (2759.625 + 422.128) / 4009.151) |
| = | 0.204728 | / | 0.206377 |
| | = | 0.992 |
4. SGI = Sales Growth Index
Ratio of Revenue 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 |
| = | 4690.54 | / | 4824.698 |
| | = | 0.9722 |
5. DEPI = Depreciation Index
Measured as the ratio of the rate of Depreciation, Depletion and Amortization 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)) |
| = | (140.049 / (140.049 + 422.128)) | / | (132.702 / (132.702 + 369.951)) |
| = | 0.249119 | / | 0.264003 |
| | = | 0.9436 |
Note: If the Depreciation, Depletion and Amortization data is not available, we assume that the depreciation rate is constant and set the Depreciation Index to 1.
6. SGAI = Sales, General and Administrative expenses Index
The ratio of Selling, General, & Admin. Expense(SGA) to Sales 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) |
| = | (815.065 / 4690.54) | / | (872.777 / 4824.698) |
| = | 0.173768 | / | 0.180898 |
| | = | 0.9606 |
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 in leverage
| LVGI | = | ((LTD_t + CurrentLiabilities_t) / TotalAssets_t) | / | ((LTD_t-1 + CurrentLiabilities_t-1) / TotalAssets_t-1) |
| = | ((135.387 + 644.932) / 4352.365) | / | ((150.01 + 747.483) / 4009.151) |
| = | 0.179286 | / | 0.223861 |
| | = | 0.8009 |
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 |
| = | (417.083 - -41.7 | - | 562.634) | / | 4352.365 |
| | = | -0.023861 |
An M-Score of equal or less than -1.78 suggests that the company is unlikely to be a manipulator. An M-Score of greater than -1.78 signals that the company is likely to be a manipulator.
EPAM Systems has a M-score of -2.54 suggests that the company is unlikely to be a manipulator.
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