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Ensco PLC (NYSE:ESV)
Beneish M-Score
-4.21 (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.

Ensco PLC has a M-score of -4.21 suggests that the company is not a manipulator.

ESV' s Beneish M-Score Range Over the Past 10 Years
Min: -4.67   Max: 0.02
Current: -4.21

-4.67
0.02

During the past 13 years, the highest Beneish M-Score of Ensco PLC was 0.02. The lowest was -4.67. And the median was -2.55.


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 Ensco PLC 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 * 0.8716+0.528 * 1+0.404 * 0.1661+0.892 * 0.9999+0.115 * 0.8934
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.8394+4.679 * -0.2656-0.327 * 1.1464
=-4.21

* 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 $731 Mil.
Revenue was 1012.2 + 1059 + 1163.9 + 1159.8 = $4,395 Mil.
Gross Profit was 578.7 + 556.4 + 645.6 + 645.8 = $2,427 Mil.
Total Current Assets was $2,413 Mil.
Total Assets was $16,441 Mil.
Property, Plant and Equipment(Net PPE) was $13,529 Mil.
Depreciation, Depletion and Amortization(DDA) was $563 Mil.
Selling, General & Admin. Expense(SGA) was $117 Mil.
Total Current Liabilities was $803 Mil.
Long-Term Debt was $5,903 Mil.
Net Income was 292 + 260.3 + 324.7 + -3451.8 = $-2,575 Mil.
Non Operating Income was 1.9 + -7.6 + -22.6 + 0 = $-28 Mil.
Cash Flow from Operations was 383.6 + 423.3 + 467.7 + 545.2 = $1,820 Mil.
Accounts Receivable was $838 Mil.
Revenue was 1201.4 + 1136.6 + 1066.7 + 990.6 = $4,395 Mil.
Gross Profit was 701.2 + 594.1 + 546.5 + 584.8 = $2,427 Mil.
Total Current Assets was $3,030 Mil.
Total Assets was $19,773 Mil.
Property, Plant and Equipment(Net PPE) was $13,128 Mil.
Depreciation, Depletion and Amortization(DDA) was $486 Mil.
Selling, General & Admin. Expense(SGA) was $139 Mil.
Total Current Liabilities was $1,132 Mil.
Long-Term Debt was $5,904 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)
=(730.6 / 4394.9) / (838.3 / 4395.3)
=0.16623814 / 0.19072646
=0.8716

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)
=(556.4 / 4395.3) / (578.7 / 4394.9)
=0.55208973 / 0.55211723
=1

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 - (2412.6 + 13528.9) / 16440.8) / (1 - (3030.4 + 13127.6) / 19772.5)
=0.03036957 / 0.1828044
=0.1661

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
=4394.9 / 4395.3
=0.9999

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))
=(486 / (486 + 13127.6)) / (563.1 / (563.1 + 13528.9))
=0.03569959 / 0.03995884
=0.8934

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)
=(116.5 / 4394.9) / (138.8 / 4395.3)
=0.026508 / 0.03157919
=0.8394

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)
=((5903.3 + 803.1) / 16440.8) / ((5903.9 + 1131.5) / 19772.5)
=0.40791202 / 0.35581742
=1.1464

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
=(-2574.8 - -28.3 - 1819.8) / 16440.8
=-0.2656

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.

Ensco PLC has a M-score of -4.21 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.

Ensco PLC Annual Data

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 1.03930.73610.95841.09910.85210.74592.23950.65811.03030.9764
GMI 0.7890.82351.00330.98951.09791.12161.15530.91220.96151.0085
AQI 0.86940.85891.08390.98930.95580.87592.64710.93880.93560.1974
SGI 1.41431.71111.18011.1460.78910.88631.67111.53721.00531.0558
DEPI 0.95910.9791.06461.01191.14071.02761.58250.74281.22770.7803
SGAI 0.68360.81451.13040.7891.50741.51781.10230.61070.98070.851
LVGI 0.87360.818910.75290.91320.75964.15310.89860.94981.4699
TATA -0.0197-0.043-0.0580.0014-0.0707-0.0363-0.0085-0.0556-0.0223-0.3712
M-score -2.24-2.35-2.61-2.14-3.14-2.98-1.02-2.58-2.55-4.66

Ensco PLC Quarterly Data

Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15
DSRI 0.96440.8451.00480.97380.94421.1291.00120.94250.79860.8716
GMI 0.95420.99120.97410.9740.9770.95250.99540.97870.97151
AQI 0.94440.93320.93560.94671.02410.96440.19740.18650.16330.1661
SGI 1.13261.08541.03080.98190.97040.97071.02971.07171.05230.9999
DEPI 0.92460.95681.22771.3041.03870.98980.78030.76080.92350.8934
SGAI 0.85210.87590.95651.00881.01330.97540.87260.78590.75940.8394
LVGI 0.9060.94360.94980.95711.05661.19831.46991.4891.32581.1464
TATA -0.0362-0.0375-0.0223-0.028-0.1217-0.1045-0.3712-0.3633-0.2687-0.2656
M-score -2.56-2.72-2.54-2.64-3.15-2.98-4.67-4.66-4.30-4.21
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