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Exponent Inc (NAS:EXPO)
Beneish M-Score
-2.34 (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 -2.34 suggests that the company is not a manipulator.

EXPO' s 10-Year Beneish M-Score Range
Min: -4.47   Max: 6.81
Current: -2.34

-4.47
6.81

During the past 13 years, the highest Beneish M-Score of Exponent Inc was 6.81. The lowest was -4.47. And the median was -2.63.


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 * 1.4699+0.528 * 0.9947+0.404 * 1.0453+0.892 * 1.0208+0.115 * 0.9308
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0083+4.679 * -0.0684-0.327 * 0.9902
=-2.34

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

This Year (Jun14) TTM:Last Year (Jun13) TTM:
Accounts Receivable was $85.8 Mil.
Revenue was 76.574 + 75.962 + 72.772 + 75.231 = $300.5 Mil.
Gross Profit was 26.282 + 24.109 + 22.747 + 25.295 = $98.4 Mil.
Total Current Assets was $255.2 Mil.
Total Assets was $351.1 Mil.
Property, Plant and Equipment(Net PPE) was $28.8 Mil.
Depreciation, Depletion and Amortization(DDA) was $5.2 Mil.
Selling, General & Admin. Expense(SGA) was $15.0 Mil.
Total Current Liabilities was $64.5 Mil.
Long-Term Debt was $0.0 Mil.
Net Income was 11.264 + 9.154 + 8.722 + 11.094 = $40.2 Mil.
Non Operating Income was 2.274 + 1.227 + 2.28 + 2.341 = $8.1 Mil.
Cash Flow from Operations was 16.85 + -6.12 + 27.974 + 17.418 = $56.1 Mil.
Accounts Receivable was $57.2 Mil.
Revenue was 75.505 + 72.66 + 72.946 + 73.298 = $294.4 Mil.
Gross Profit was 27.487 + 20.43 + 23.861 + 24.136 = $95.9 Mil.
Total Current Assets was $228.1 Mil.
Total Assets was $314.3 Mil.
Property, Plant and Equipment(Net PPE) was $28.8 Mil.
Depreciation, Depletion and Amortization(DDA) was $4.8 Mil.
Selling, General & Admin. Expense(SGA) was $14.6 Mil.
Total Current Liabilities was $58.3 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)
=(85.795 / 300.539) / (57.176 / 294.409)
=0.28547044 / 0.19420602
=1.4699

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)
=(24.109 / 294.409) / (26.282 / 300.539)
=0.32578488 / 0.32752155
=0.9947

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 - (255.218 + 28.831) / 351.12) / (1 - (228.123 + 28.763) / 314.329)
=0.19102016 / 0.18274801
=1.0453

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
=300.539 / 294.409
=1.0208

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))
=(4.769 / (4.769 + 28.763)) / (5.2 / (5.2 + 28.831))
=0.14222235 / 0.15280186
=0.9308

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)
=(15.041 / 300.539) / (14.613 / 294.409)
=0.05004675 / 0.04963503
=1.0083

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 + 64.511) / 351.12) / ((0 + 58.322) / 314.329)
=0.18372921 / 0.18554445
=0.9902

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
=(40.234 - 8.122 - 56.122) / 351.12
=-0.0684

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 -2.34 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 0.97730.98870.98562.61810.97621.10390.92990.93921.01820.9993
AQI 0.94621.20021.40490.91061.05461.20251.01721.11831.04111.1125
SGI 1.08471.02431.08571.21751.11550.99581.09161.09521.07421.012
DEPI 0.82720.91450.9921.13640.99840.89060.95020.98120.9520.9964
SGAI 1.01751.0081.03460.08470.99720.82541.02920.96860.96241.0723
LVGI 0.85610.94451.18531.26471.0930.82871.02151.01391.00630.9213
TATA -0.032-0.004-0.0425-0.0464-0.0725-0.0379-0.0456-0.0559-0.0478-0.0901
M-score -2.57-2.24-2.55-1.58-2.80-2.44-2.61-2.71-2.53-2.93

Exponent Inc Quarterly Data

Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14
DSRI 0.98080.62981.08761.00370.69020.98530.89111.03311.46991.739
GMI 0.92451.02561.01821.01151.01880.97460.99930.97210.99470.9621
AQI 1.04561.0261.04111.1111.06161.08411.11250.91561.04531.0376
SGI 1.04781.07671.07421.0831.05041.03031.0121.02071.02081.0254
DEPI 0.91720.95450.9521.04041.030.9820.99640.90870.93081.2346
SGAI 0.93820.9560.96241.02341.08161.07191.07231.04281.00831.0346
LVGI 1.01830.99951.00630.94980.93760.91080.92131.25080.99021.1158
TATA -0.0685-0.0384-0.0478-0.0417-0.0425-0.0879-0.0901-0.0806-0.0684-0.0097
M-score -2.80-2.91-2.53-2.53-2.87-2.84-2.93-2.96-2.34-1.84
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