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Exponent Inc (NAS:EXPO)
Beneish M-Score
-2.96 (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 -2.96 suggests that the company is not a manipulator.

EXPO' s 10-Year Beneish M-Score Range
Min: -5.43   Max: 6.81
Current: -2.96

-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 -2.59.


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 * 1.0331+0.528 * 0.9721+0.404 * 0.9194+0.892 * 1.0207+0.115 * 0.9087
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0428+4.679 * -0.0805-0.327 * 1.2562
=-2.96

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

This Year (Mar14) TTM:Last Year (Mar13) TTM:
Accounts Receivable was $84.9 Mil.
Revenue was 75.962 + 72.772 + 75.231 + 75.505 = $299.5 Mil.
Gross Profit was 24.109 + 22.747 + 25.295 + 27.487 = $99.6 Mil.
Total Current Assets was $249.6 Mil.
Total Assets was $342.0 Mil.
Property, Plant and Equipment(Net PPE) was $28.3 Mil.
Depreciation, Depletion and Amortization(DDA) was $5.1 Mil.
Selling, General & Admin. Expense(SGA) was $15.0 Mil.
Total Current Liabilities was $62.4 Mil.
Long-Term Debt was $0.0 Mil.
Net Income was 9.154 + 8.722 + 11.094 + 10.848 = $39.8 Mil.
Non Operating Income was 1.227 + 2.28 + 2.341 + 0.642 = $6.5 Mil.
Cash Flow from Operations was -6.12 + 27.974 + 17.418 + 21.582 = $60.9 Mil.
Accounts Receivable was $80.6 Mil.
Revenue was 72.66 + 72.946 + 73.298 + 74.484 = $293.4 Mil.
Gross Profit was 20.43 + 23.861 + 24.136 + 26.461 = $94.9 Mil.
Total Current Assets was $206.6 Mil.
Total Assets was $295.0 Mil.
Property, Plant and Equipment(Net PPE) was $28.3 Mil.
Depreciation, Depletion and Amortization(DDA) was $4.6 Mil.
Selling, General & Admin. Expense(SGA) was $14.1 Mil.
Total Current Liabilities was $42.8 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)
=(84.946 / 299.47) / (80.552 / 293.388)
=0.28365446 / 0.27455792
=1.0331

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)
=(22.747 / 293.388) / (24.109 / 299.47)
=0.32342154 / 0.33271446
=0.9721

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 - (249.641 + 28.314) / 341.994) / (1 - (206.645 + 28.256) / 294.975)
=0.18725182 / 0.20365794
=0.9194

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
=299.47 / 293.388
=1.0207

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))
=(4.571 / (4.571 + 28.256)) / (5.124 / (5.124 + 28.314))
=0.13924513 / 0.15323883
=0.9087

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)
=(14.98 / 299.47) / (14.074 / 293.388)
=0.05002171 / 0.04797061
=1.0428

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 + 62.402) / 341.994) / ((0 + 42.845) / 294.975)
=0.18246519 / 0.1452496
=1.2562

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
=(39.818 - 6.49 - 60.854) / 341.994
=-0.0805

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 -2.96 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

Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14
DSRI 0.92610.89540.98081.13081.08761.00371.04350.90270.89111.0331
GMI 0.93920.9430.92451.02561.01821.01151.01880.97460.99930.9721
AQI 1.11831.11621.04561.0261.04111.1111.06161.08411.11250.9194
SGI 1.09521.03071.04781.07671.07421.0831.05041.03031.0121.0207
DEPI 0.98120.95080.91720.95450.9521.04041.030.9820.99640.9087
SGAI 0.96860.94740.93820.9560.96241.02341.08161.07191.07231.0428
LVGI 1.01390.96681.01830.99951.00630.94980.93760.91080.92131.2562
TATA -0.0559-0.0757-0.0685-0.0384-0.0478-0.0417-0.0425-0.0879-0.0901-0.0805
M-score -2.71-2.87-2.80-2.44-2.53-2.53-2.55-2.92-2.93-2.96
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