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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.
During the past 5 years, the highest Beneish M-Score of Greenway Medical Technologies Inc was 0.00. The lowest was 0.00. And the median was 0.00.
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 Greenway Medical Technologies 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 * 0.6737||+||0.528 * 1.0522||+||0.404 * 1.4125||+||0.892 * 1.0873||+||0.115 * 0.7276|
|-||0.172 * SGAI||+||4.679 * TATA||-||0.327 * LVGI|
|-||0.172 * 1.1279||+||4.679 * -0.0766||-||0.327 * 0.7542|
|This Year (Jun13) TTM:||Last Year (Jun12) TTM:|
|Accounts Receivable was $21.2 Mil.|
Revenue was 35.526 + 33.823 + 32.721 + 32.774 = $134.8 Mil.
Gross Profit was 18.282 + 16.851 + 17.406 + 17.846 = $70.4 Mil.
Total Current Assets was $38.8 Mil.
Total Assets was $126.1 Mil.
Property, Plant and Equipment(Net PPE) was $28.4 Mil.
Depreciation, Depletion and Amortization(DDA) was $9.1 Mil.
Selling, General & Admin. Expense(SGA) was $58.3 Mil.
Total Current Liabilities was $24.5 Mil.
Long-Term Debt was $0.0 Mil.
Net Income was -3.48 + -0.608 + -0.985 + 0.008 = $-5.1 Mil.
Non Operating Income was 0.002 + -0.016 + -0.017 + -0.024 = $-0.1 Mil.
Cash Flow from Operations was 3.279 + -4.66 + 3.664 + 2.363 = $4.6 Mil.
|Accounts Receivable was $28.9 Mil.
Revenue was 36.375 + 32.865 + 29.122 + 25.65 = $124.0 Mil.
Gross Profit was 21.808 + 18.035 + 14.976 + 13.294 = $68.1 Mil.
Total Current Assets was $68.8 Mil.
Total Assets was $133.1 Mil.
Property, Plant and Equipment(Net PPE) was $20.3 Mil.
Depreciation, Depletion and Amortization(DDA) was $4.4 Mil.
Selling, General & Admin. Expense(SGA) was $47.6 Mil.
Total Current Liabilities was $34.2 Mil.
Long-Term Debt was $0.1 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)|
|=||(21.151 / 134.844)||/||(28.875 / 124.012)|
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)|
|=||(16.851 / 124.012)||/||(18.282 / 134.844)|
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 - (38.841 + 28.416) / 126.129)||/||(1 - (68.791 + 20.34) / 133.123)|
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))|
|=||(4.372 / (4.372 + 20.34))||/||(9.129 / (9.129 + 28.416))|
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)|
|=||(58.336 / 134.844)||/||(47.565 / 124.012)|
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 + 24.494) / 126.129)||/||((0.116 + 34.161) / 133.123)|
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|
|=||(-5.065 - -0.055||-||4.646)||/||126.129|
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.
Greenway Medical Technologies Inc has a M-score of -2.84 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
Greenway Medical Technologies Inc Annual Data
Greenway Medical Technologies Inc Quarterly Data