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Exar Corp (NYSE:EXAR)
Beneish M-Score
-1.79 (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.

Exar Corp has a M-score of -1.79 signals that the company is a manipulator.

EXAR' s 10-Year Beneish M-Score Range
Min: -4.17   Max: -0.04
Current: -1.79

-4.17
-0.04

During the past 13 years, the highest Beneish M-Score of Exar Corp was -0.04. The lowest was -4.17. And the median was -2.67.


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 Exar 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 * 1.4135+0.528 * 1.3119+0.404 * 2.3506+0.892 * 1.2931+0.115 * 0.9137
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0238+4.679 * -0.1087-0.327 * 1.4129
=-1.79

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

This Year (Mar15) TTM:Last Year (Mar14) TTM:
Accounts Receivable was $27.5 Mil.
Revenue was 43.857 + 44.315 + 43.159 + 30.719 = $162.1 Mil.
Gross Profit was 17.948 + 16.89 + 4.132 + 10.956 = $49.9 Mil.
Total Current Assets was $118.2 Mil.
Total Assets was $283.1 Mil.
Property, Plant and Equipment(Net PPE) was $26.1 Mil.
Depreciation, Depletion and Amortization(DDA) was $18.4 Mil.
Selling, General & Admin. Expense(SGA) was $43.8 Mil.
Total Current Liabilities was $50.8 Mil.
Long-Term Debt was $5.1 Mil.
Net Income was -2.914 + -6.599 + -23.352 + -12.105 = $-45.0 Mil.
Non Operating Income was -0.544 + 0 + 0 + 0 = $-0.5 Mil.
Cash Flow from Operations was 2.37 + -5.914 + -1.96 + -8.137 = $-13.6 Mil.
Accounts Receivable was $15.0 Mil.
Revenue was 27.987 + 30.69 + 34.018 + 32.627 = $125.3 Mil.
Gross Profit was 8.422 + 12.826 + 13.929 + 15.477 = $50.7 Mil.
Total Current Assets was $217.9 Mil.
Total Assets was $302.2 Mil.
Property, Plant and Equipment(Net PPE) was $21.3 Mil.
Depreciation, Depletion and Amortization(DDA) was $12.9 Mil.
Selling, General & Admin. Expense(SGA) was $33.1 Mil.
Total Current Liabilities was $42.1 Mil.
Long-Term Debt was $0.1 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)
=(27.459 / 162.05) / (15.023 / 125.322)
=0.1694477 / 0.1198752
=1.4135

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)
=(16.89 / 125.322) / (17.948 / 162.05)
=0.4041908 / 0.3080901
=1.3119

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 - (118.212 + 26.077) / 283.1) / (1 - (217.897 + 21.28) / 302.217)
=0.49032497 / 0.20859184
=2.3506

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
=162.05 / 125.322
=1.2931

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))
=(12.947 / (12.947 + 21.28)) / (18.424 / (18.424 + 26.077))
=0.37826862 / 0.41401317
=0.9137

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)
=(43.758 / 162.05) / (33.055 / 125.322)
=0.27002777 / 0.26376055
=1.0238

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)
=((5.069 + 50.806) / 283.1) / ((0.07 + 42.146) / 302.217)
=0.19736842 / 0.13968771
=1.4129

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
=(-44.97 - -0.544 - -13.641) / 283.1
=-0.1087

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.

Exar Corp has a M-score of -1.79 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.

Exar Corp Annual Data

Mar06Mar07Mar08Mar09Mar10Mar11Mar12Mar13Mar14Mar15
DSRI 1.63090.5752.38730.5281.64130.67370.98051.18681.15971.4135
GMI 1.0060.99881.51981.02410.92881.07211.02350.93841.12911.3119
AQI 1.91290.97353.12260.15134.41490.57310.77421.59662.42982.3506
SGI 1.16831.02211.31011.28281.17161.08250.89430.93461.0271.2931
DEPI 0.94930.99980.79840.84720.77610.9660.96881.12710.81860.9137
SGAI 0.88211.14541.16060.80141.07030.8590.95650.89870.98611.0238
LVGI 1.31210.98472.44611.54921.29791.00510.92910.91260.98661.4129
TATA -0.0087-0.0324-0.1035-0.2215-0.0943-0.1095-0.0974-0.01530.0174-0.1087
M-score -1.51-3.03-0.80-4.19-0.97-3.33-3.10-2.17-1.60-1.79

Exar Corp Quarterly Data

Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15
DSRI 1.25881.18681.05861.11361.67861.15971.70921.22661.07831.4135
GMI 1.03320.93840.90960.90470.92961.12911.24361.66811.621.3119
AQI 0.65121.59661.57194.33184.61182.42984.92412.18922.56242.3506
SGI 0.8690.93461.02091.09761.08281.0270.98411.02921.13771.2931
DEPI 0.91911.12710.68880.64020.62120.81861.31631.16141.27790.9137
SGAI 0.980.89870.86360.89120.94890.98611.09931.05241.0081.0238
LVGI 0.95630.91260.96360.96090.93420.98662.1772.1821.41721.4129
TATA -0.0685-0.0153-0.0216-0.00450.01450.01740.0038-0.0701-0.0983-0.1087
M-score -2.79-2.17-2.33-1.02-0.31-1.60-0.48-2.12-1.89-1.79
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