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FMC Corp (NYSE:FMC)
Beneish M-Score
-1.52 (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.

FMC Corp has a M-score of -1.52 signals that the company is a manipulator.

FMC' s Beneish M-Score Range Over the Past 10 Years
Min: -3.32   Max: -1.52
Current: -1.52

-3.32
-1.52

During the past 13 years, the highest Beneish M-Score of FMC Corp was -1.52. The lowest was -3.32. And the median was -2.52.


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 FMC 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 * 0.9303+0.528 * 1.1442+0.404 * 1.5594+0.892 * 1.1549+0.115 * 0.6202
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.4032+4.679 * 0.1472-0.327 * 0.9862
=-1.52

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

This Year (Sep15) TTM:Last Year (Sep14) TTM:
Accounts Receivable was $1,690 Mil.
Revenue was 830.7 + 887.1 + 659.4 + 1666.8 = $4,044 Mil.
Gross Profit was 220.3 + 305.8 + 250.7 + 482.4 = $1,259 Mil.
Total Current Assets was $3,238 Mil.
Total Assets was $6,447 Mil.
Property, Plant and Equipment(Net PPE) was $1,083 Mil.
Depreciation, Depletion and Amortization(DDA) was $153 Mil.
Selling, General & Admin. Expense(SGA) was $837 Mil.
Total Current Liabilities was $1,455 Mil.
Long-Term Debt was $2,049 Mil.
Net Income was -2.4 + 742.3 + -46.8 + 76.5 = $770 Mil.
Non Operating Income was -40.4 + 0.1 + -0.1 + -0.7 = $-41 Mil.
Cash Flow from Operations was -137.9 + 124.6 + -297.2 + 172 = $-139 Mil.
Accounts Receivable was $1,573 Mil.
Revenue was 819.1 + 794.9 + 756.9 + 1130.7 = $3,502 Mil.
Gross Profit was 283.5 + 316.1 + 293 + 354.9 = $1,248 Mil.
Total Current Assets was $2,857 Mil.
Total Assets was $5,251 Mil.
Property, Plant and Equipment(Net PPE) was $1,283 Mil.
Depreciation, Depletion and Amortization(DDA) was $106 Mil.
Selling, General & Admin. Expense(SGA) was $517 Mil.
Total Current Liabilities was $1,742 Mil.
Long-Term Debt was $1,152 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)
=(1689.6 / 4044) / (1572.6 / 3501.6)
=0.41780415 / 0.44910898
=0.9303

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)
=(305.8 / 3501.6) / (220.3 / 4044)
=0.35626571 / 0.31137488
=1.1442

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 - (3238.1 + 1082.8) / 6447) / (1 - (2857.3 + 1283.3) / 5251.1)
=0.32978129 / 0.2114795
=1.5594

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
=4044 / 3501.6
=1.1549

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))
=(106.4 / (106.4 + 1283.3)) / (152.5 / (152.5 + 1082.8))
=0.07656329 / 0.12345179
=0.6202

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)
=(837.2 / 4044) / (516.6 / 3501.6)
=0.20702275 / 0.14753256
=1.4032

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)
=((2048.5 + 1455) / 6447) / ((1151.9 + 1741.5) / 5251.1)
=0.54343105 / 0.55100836
=0.9862

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
=(769.6 - -41.1 - -138.5) / 6447
=0.1472

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.

FMC Corp has a M-score of -1.52 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.

FMC Corp Annual Data

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 0.98490.99550.99340.96921.20151.03191.00741.14211.21661.1321
GMI 0.94250.9870.99180.96841.00820.92620.97560.92921.07521.0158
AQI 0.90870.97590.93580.93911.051.0431.0421.1920.70441.0327
SGI 1.04621.09321.12231.18320.90721.10261.08391.00951.13631.042
DEPI 0.90791.04190.91041.07151.00240.91761.11681.05181.1691.0148
SGAI 1.01430.96380.98610.90281.05481.15710.99281.09630.92691.1558
LVGI 0.85980.9550.94611.05410.91591.06791.03431.03891.26390.9563
TATA -0.0447-0.0493-0.051-0.002-0.024-0.0556-0.00480.0131-0.0065-0.0122
M-score -2.70-2.62-2.64-2.39-2.45-2.70-2.41-2.26-2.32-2.37

FMC Corp Quarterly Data

Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15
DSRI 1.12791.14231.27841.22441.32981.39331.13210.92581.12260.9303
GMI 0.94820.99911.05251.07261.05911.00251.01581.01691.06261.1442
AQI 0.98090.98410.70440.90250.90720.90161.03270.96741.43341.5594
SGI 0.97441.02331.08131.04721.03290.95681.0421.05891.10781.1549
DEPI 1.33281.0291.1691.02881.01481.24871.01480.69890.76250.6202
SGAI 1.05841.00360.9380.96860.96921.0661.15581.49411.51571.4032
LVGI 1.01021.23491.26391.1331.18880.95720.95631.05351.02630.9862
TATA 0.0221-0.0014-0.0064-0.00920.0020.0148-0.01230.00420.10490.1472
M-score -2.29-2.42-2.33-2.31-2.20-2.09-2.37-2.62-1.70-1.52
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