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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.
Goldcorp Inc has a M-score of -2.50 suggests that the company is not a manipulator.
During the past 13 years, the highest Beneish M-Score of Goldcorp Inc was 6.55. The lowest was -6.82. And the median was -2.45.
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 Goldcorp 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 * 1.175||+||0.528 * 1.3543||+||0.404 * 1.0673||+||0.892 * 0.9553||+||0.115 * 0.8702|
|-||0.172 * SGAI||+||4.679 * TATA||-||0.327 * LVGI|
|-||0.172 * 1||+||4.679 * -0.0595||-||0.327 * 1.1841|
|This Year (Sep14) TTM:||Last Year (Sep13) TTM:|
|Accounts Receivable was $449 Mil.|
Revenue was 859 + 906 + 898 + 970 = $3,633 Mil.
Gross Profit was 329 + 221 + 228 + -146 = $632 Mil.
Total Current Assets was $2,068 Mil.
Total Assets was $30,218 Mil.
Property, Plant and Equipment(Net PPE) was $26,078 Mil.
Depreciation, Depletion and Amortization(DDA) was $712 Mil.
Selling, General & Admin. Expense(SGA) was $235 Mil.
Total Current Liabilities was $1,664 Mil.
Long-Term Debt was $2,472 Mil.
Net Income was -44 + 181 + 98 + -1089 = $-854 Mil.
Non Operating Income was -4 + 11 + -7 + -102 = $-102 Mil.
Cash Flow from Operations was 192 + 275 + 273 + 307 = $1,047 Mil.
|Accounts Receivable was $400 Mil.
Revenue was 895 + 858 + 964 + 1086 = $3,803 Mil.
Gross Profit was 386 + 173 + 344 + -7 = $896 Mil.
Total Current Assets was $2,667 Mil.
Total Assets was $29,933 Mil.
Property, Plant and Equipment(Net PPE) was $25,343 Mil.
Depreciation, Depletion and Amortization(DDA) was $600 Mil.
Selling, General & Admin. Expense(SGA) was $246 Mil.
Total Current Liabilities was $1,979 Mil.
Long-Term Debt was $1,481 Mil.
1. DSRI = Days Sales in Receivables Index
A large increase in DSR could be indicative of revenue inflation.
|DSRI||=||(Receivables_t / Revenue_t)||/||(Receivables_t-1 / Revenue_t-1)|
|=||(449 / 3633)||/||(400 / 3803)|
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.
|=||(GrossProfit_t-1 / Revenue_t-1)||/||(GrossProfit_t / Revenue_t)|
|=||(221 / 3803)||/||(329 / 3633)|
3. AQI = Asset Quality Index
AQI is the ratio of asset quality in year t to year t-1.
|AQI||=||(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t)||/||(1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)|
|=||(1 - (2068 + 26078) / 30218)||/||(1 - (2667 + 25343) / 29933)|
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.
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))|
|=||(600 / (600 + 25343))||/||(712 / (712 + 26078))|
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)|
|=||(235 / 3633)||/||(246 / 3803)|
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)|
|=||((2472 + 1664) / 30218)||/||((1481 + 1979) / 29933)|
8. TATA = Total Accruals to Total Assets
Total accruals calculated as the change in working capital accounts other than cash less depreciation.
|=||(NetIncome_t - NonOperatingIncome_t||-||CashFlowsfromOperations_t)||/||TotalAssets_t|
|=||(-854 - -102||-||1047)||/||30218|
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.
Goldcorp Inc has a M-score of -2.50 suggests that the company will not be a manipulator.
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
Goldcorp Inc Annual Data
Goldcorp Inc Quarterly Data