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Exponent Inc (NAS:EXPO)
Beneish M-Score
-2.67 (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.

Exponent Inc has a M-score of -2.67 suggests that the company is not a manipulator.

EXPO' s 10-Year Beneish M-Score Range
Min: -5.43   Max: 6.81
Current: -2.67

-5.43
6.81

During the past 13 years, the highest Beneish M-Score of Exponent Inc was 6.81. The lowest was -5.43. And the median was -2.60.


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 Exponent 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 * 1.0931+0.528 * 0.9621+0.404 * 1.0376+0.892 * 1.0254+0.115 * 0.9566
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0346+4.679 * -0.0533-0.327 * 1.1158
=-2.67

* 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 $56.0 Mil.
Revenue was 78.557 + 76.574 + 75.962 + 72.772 = $303.9 Mil.
Gross Profit was 30.316 + 26.282 + 24.109 + 22.747 = $103.5 Mil.
Total Current Assets was $254.5 Mil.
Total Assets was $352.1 Mil.
Property, Plant and Equipment(Net PPE) was $28.8 Mil.
Depreciation, Depletion and Amortization(DDA) was $5.3 Mil.
Selling, General & Admin. Expense(SGA) was $15.7 Mil.
Total Current Liabilities was $71.4 Mil.
Long-Term Debt was $0.0 Mil.
Net Income was 11.04 + 11.264 + 9.154 + 8.722 = $40.2 Mil.
Non Operating Income was -0.896 + 2.274 + 1.227 + 2.28 = $4.9 Mil.
Cash Flow from Operations was 15.346 + 16.85 + -6.12 + 27.974 = $54.1 Mil.
Accounts Receivable was $50.0 Mil.
Revenue was 75.231 + 75.505 + 72.66 + 72.946 = $296.3 Mil.
Gross Profit was 25.295 + 27.487 + 20.43 + 23.861 = $97.1 Mil.
Total Current Assets was $235.0 Mil.
Total Assets was $324.5 Mil.
Property, Plant and Equipment(Net PPE) was $28.4 Mil.
Depreciation, Depletion and Amortization(DDA) was $4.9 Mil.
Selling, General & Admin. Expense(SGA) was $14.8 Mil.
Total Current Liabilities was $58.9 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)
=(55.999 / 303.865) / (49.961 / 296.342)
=0.18428908 / 0.16859237
=1.0931

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)
=(26.282 / 296.342) / (30.316 / 303.865)
=0.32757085 / 0.3404604
=0.9621

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 - (254.483 + 28.812) / 352.056) / (1 - (235.027 + 28.372) / 324.477)
=0.19531268 / 0.18823522
=1.0376

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
=303.865 / 296.342
=1.0254

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))
=(4.919 / (4.919 + 28.372)) / (5.263 / (5.263 + 28.812))
=0.14775765 / 0.15445341
=0.9566

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)
=(15.709 / 303.865) / (14.808 / 296.342)
=0.0516973 / 0.04996929
=1.0346

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)
=((0 + 71.355) / 352.056) / ((0 + 58.939) / 324.477)
=0.20268082 / 0.18164307
=1.1158

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
=(40.18 - 4.885 - 54.05) / 352.056
=-0.0533

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.

Exponent Inc has a M-score of -2.67 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.

Exponent Inc Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 0.99241.16920.96091.01920.93231.01151.05310.92611.08760.8911
GMI 0.97730.98870.98561.03192.47681.10390.92990.93921.01820.9993
AQI 0.94661.19981.40490.91061.05461.20251.01721.11831.04111.1125
SGI 1.08471.02431.08571.21751.11550.99581.09161.09521.07421.012
DEPI 0.82720.91450.9920.93881.20850.89060.95020.98120.9520.9964
SGAI 1.01751.0081.03460.9260.09130.82541.02920.96860.96241.0723
LVGI 0.85050.94411.18531.26471.0930.82871.02151.01391.00630.9213
TATA -0.032-0.004-0.0425-0.0464-0.0725-0.0379-0.0456-0.0559-0.0478-0.0901
M-score -2.57-2.24-2.55-2.59-1.83-2.44-2.61-2.71-2.53-2.93

Exponent Inc Quarterly Data

Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14
DSRI 0.98080.62981.08761.00370.69020.98530.89111.03311.46991.0931
GMI 0.92451.02561.01821.01151.01880.97460.99930.97210.99470.9621
AQI 1.04561.0261.04111.1111.06161.08411.11250.91941.04531.0376
SGI 1.04781.07671.07421.0831.05041.03031.0121.02071.02081.0254
DEPI 0.91720.95450.9520.97171.030.9820.99640.95930.93080.9566
SGAI 0.93820.9560.96241.02341.08161.07191.07231.04281.00831.0346
LVGI 1.01830.99951.00630.94980.93760.91080.92131.25620.99021.1158
TATA -0.0685-0.0384-0.0478-0.0417-0.0425-0.0879-0.0901-0.0805-0.0684-0.0533
M-score -2.80-2.91-2.53-2.54-2.87-2.84-2.93-2.95-2.34-2.67
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