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ExlService Holdings Inc (NAS:EXLS)
Beneish M-Score
-2.61 (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.

ExlService Holdings Inc has a M-score of -2.61 suggests that the company is not a manipulator.

EXLS' s 10-Year Beneish M-Score Range
Min: -3.31   Max: -1.49
Current: -2.61

-3.31
-1.49

During the past 13 years, the highest Beneish M-Score of ExlService Holdings Inc was -1.49. The lowest was -3.31. And the median was -2.53.


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 ExlService Holdings 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 * 1.1199+0.528 * 1.1459+0.404 * 1.2118+0.892 * 1.1412+0.115 * 0.9174
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0283+4.679 * -0.0558-0.327 * 1.7707
=-2.61

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

This Year (Jun15) TTM:Last Year (Jun14) TTM:
Accounts Receivable was $94.2 Mil.
Revenue was 155.621 + 143.51 + 135.286 + 122.457 = $556.9 Mil.
Gross Profit was 55.143 + 50.385 + 43.915 + 37.474 = $186.9 Mil.
Total Current Assets was $301.6 Mil.
Total Assets was $613.7 Mil.
Property, Plant and Equipment(Net PPE) was $48.2 Mil.
Depreciation, Depletion and Amortization(DDA) was $30.1 Mil.
Selling, General & Admin. Expense(SGA) was $115.6 Mil.
Total Current Liabilities was $94.9 Mil.
Long-Term Debt was $60.3 Mil.
Net Income was 12.074 + 9.567 + 7.46 + 6.075 = $35.2 Mil.
Non Operating Income was 1.207 + 1.193 + 0.323 + 0.642 = $3.4 Mil.
Cash Flow from Operations was 27.03 + 0.137 + 22.354 + 16.552 = $66.1 Mil.
Accounts Receivable was $73.7 Mil.
Revenue was 119.738 + 121.797 + 124.123 + 122.315 = $488.0 Mil.
Gross Profit was 38.479 + 46.875 + 52.073 + 50.266 = $187.7 Mil.
Total Current Assets was $272.9 Mil.
Total Assets was $494.3 Mil.
Property, Plant and Equipment(Net PPE) was $46.0 Mil.
Depreciation, Depletion and Amortization(DDA) was $25.1 Mil.
Selling, General & Admin. Expense(SGA) was $98.5 Mil.
Total Current Liabilities was $69.6 Mil.
Long-Term Debt was $1.0 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)
=(94.216 / 556.874) / (73.721 / 487.973)
=0.16918728 / 0.15107598
=1.1199

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)
=(50.385 / 487.973) / (55.143 / 556.874)
=0.38463808 / 0.33565403
=1.1459

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 - (301.608 + 48.152) / 613.718) / (1 - (272.862 + 45.978) / 494.273)
=0.43009656 / 0.35493138
=1.2118

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
=556.874 / 487.973
=1.1412

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))
=(25.078 / (25.078 + 45.978)) / (30.107 / (30.107 + 48.152))
=0.3529329 / 0.38470975
=0.9174

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)
=(115.638 / 556.874) / (98.543 / 487.973)
=0.20765559 / 0.20194355
=1.0283

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)
=((60.323 + 94.892) / 613.718) / ((0.977 + 69.619) / 494.273)
=0.25290932 / 0.14282795
=1.7707

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
=(35.176 - 3.365 - 66.073) / 613.718
=-0.0558

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.

ExlService Holdings Inc has a M-score of -2.61 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.

ExlService Holdings Inc Annual Data

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 1.14731.11310.9720.8590.98360.95790.88331.05920.97281.0102
GMI 1.00940.90541.07010.96480.89231.06431.02981.00950.98541.1735
AQI 0.85622.63521.10630.98021.37421.64871.41040.97990.87061.0352
SGI 1.2231.64661.47731.01011.05111.32331.42651.22851.08021.0435
DEPI 0.85910.81760.89081.21520.96981.02970.88950.89280.94131.097
SGAI 0.97050.9761.08811.09311.02630.97530.90420.94160.9991.054
LVGI 1.01510.5620.88840.92250.83221.08481.21230.8720.94571.4766
TATA -0.112-0.033-0.0186-0.0504-0.0565-0.0462-0.0658-0.0492-0.0641-0.0596
M-score -2.74-1.22-2.08-2.83-2.57-2.17-2.40-2.42-2.78-2.76

ExlService Holdings Inc Quarterly Data

Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15
DSRI 1.12421.111.02260.97280.9520.91640.98821.01021.0681.1199
GMI 0.98471.00250.99370.98540.98180.99151.07961.17351.20881.1459
AQI 0.98081.00241.02560.87060.85680.84350.90991.03521.19311.2118
SGI 1.15831.11331.10311.08021.06581.05551.03421.04351.07591.1412
DEPI 0.88760.90240.850.94131.1061.19741.22541.0970.95470.9174
SGAI 0.97490.99181.03650.9990.98131.00530.98661.0541.06321.0283
LVGI 0.88720.92910.96230.94570.97160.9270.97811.47661.95321.7707
TATA -0.0496-0.0613-0.0425-0.0641-0.0545-0.0648-0.0803-0.06-0.054-0.0558
M-score -2.44-2.55-2.57-2.78-2.76-2.83-2.80-2.76-2.74-2.61
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