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IAC/InterActiveCorp (NAS:IACI)
Beneish M-Score
-2.86 (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.

IAC/InterActiveCorp has a M-score of -2.86 suggests that the company is not a manipulator.

IACI' s 10-Year Beneish M-Score Range
Min: -4.45   Max: 10.93
Current: -2.86

-4.45
10.93

During the past 13 years, the highest Beneish M-Score of IAC/InterActiveCorp was 10.93. The lowest was -4.45. And the median was -2.31.


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 IAC/InterActiveCorp 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 * 0.8362+0.528 * 0.9653+0.404 * 0.9315+0.892 * 1.0793+0.115 * 0.8549
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9654+4.679 * -0.0352-0.327 * 1.2433
=-2.86

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

This Year (Dec13) TTM:Last Year (Dec12) TTM:
Accounts Receivable was $207 Mil.
Revenue was 724.455 + 756.872 + 799.411 + 742.249 = $3,023 Mil.
Gross Profit was 501.881 + 508.016 + 526.589 + 487.167 = $2,024 Mil.
Total Current Assets was $1,475 Mil.
Total Assets was $4,235 Mil.
Property, Plant and Equipment(Net PPE) was $294 Mil.
Depreciation, Depletion and Amortization(DDA) was $119 Mil.
Selling, General & Admin. Expense(SGA) was $1,339 Mil.
Total Current Liabilities was $587 Mil.
Long-Term Debt was $1,080 Mil.
Net Income was 76.917 + 96.94 + 58.29 + 53.637 = $286 Mil.
Non Operating Income was 9.743 + 13.466 + -1.082 + 1.567 = $24 Mil.
Cash Flow from Operations was 86.631 + 96.067 + 135.901 + 92.362 = $411 Mil.
Accounts Receivable was $230 Mil.
Revenue was 765.251 + 714.47 + 680.612 + 640.6 = $2,801 Mil.
Gross Profit was 497.333 + 452.195 + 443.308 + 417.029 = $1,810 Mil.
Total Current Assets was $1,157 Mil.
Total Assets was $3,806 Mil.
Property, Plant and Equipment(Net PPE) was $271 Mil.
Depreciation, Depletion and Amortization(DDA) was $88 Mil.
Selling, General & Admin. Expense(SGA) was $1,285 Mil.
Total Current Liabilities was $625 Mil.
Long-Term Debt was $580 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)
=(207.408 / 3022.987) / (229.83 / 2800.933)
=0.06861029 / 0.0820548
=0.8362

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)
=(508.016 / 2800.933) / (501.881 / 3022.987)
=0.64616505 / 0.66942167
=0.9653

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 - (1475.386 + 293.964) / 4234.684) / (1 - (1156.75 + 270.512) / 3805.828)
=0.58217662 / 0.6249799
=0.9315

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
=3022.987 / 2800.933
=1.0793

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))
=(88.252 / (88.252 + 270.512)) / (118.752 / (118.752 + 293.964))
=0.24598901 / 0.28773297
=0.8549

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)
=(1338.903 / 3022.987) / (1285.001 / 2800.933)
=0.4429073 / 0.45877606
=0.9654

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)
=((1080 + 586.897) / 4234.684) / ((580 + 624.889) / 3805.828)
=0.39362961 / 0.3165905
=1.2433

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
=(285.784 - 23.694 - 410.961) / 4234.684
=-0.0352

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.

IAC/InterActiveCorp has a M-score of -2.86 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.

IAC/InterActiveCorp Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 0.80490.93934.81890.02147.77571.01931.05251.17660.95460.8362
GMI 0.92750.92330.766310.74670.08720.98361.06841.01090.97540.9658
AQI 0.96150.8810.9881.07070.7430.79591.14091.2341.07030.9315
SGI 1.02291.28470.200213.2440.10850.93191.21541.25821.361.0793
DEPI 1.01551.11611.05280.77272.01540.60151.68831.09230.94640.8549
SGAI 1.32131.09621.60880.087711.24970.98620.89210.92670.99860.967
LVGI 1.18481.39271.03180.8620.35051.37961.33411.40381.71351.2433
TATA -0.0503-0.0266-0.0474-0.082-0.132-0.356-0.0598-0.048-0.0439-0.0352
M-score -3.04-2.63-0.1412.510.32-4.45-2.44-2.32-2.63-2.86

IAC/InterActiveCorp Quarterly Data

Sep11Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13
DSRI 1.08521.17661.05911.20181.03930.95460.99820.92690.81730.8362
GMI 1.04681.01090.98890.97330.97360.97550.98410.99040.97470.9653
AQI 1.29711.2341.2480.94811.06271.07031.06791.13420.96690.9315
SGI 1.25631.25821.30311.34531.37551.361.29591.24081.16381.0793
DEPI 1.66371.09231.03610.95121.08290.94640.97590.88380.77840.8549
SGAI 0.93020.92670.97030.99390.99751.0020.97710.97710.96160.9654
LVGI 1.4491.40381.27481.3611.18541.71351.71781.60621.57791.2433
TATA -0.0455-0.048-0.0449-0.0497-0.0597-0.0439-0.0491-0.0468-0.0306-0.0352
M-score -2.30-2.32-2.35-2.38-2.43-2.63-2.66-2.71-2.88-2.86
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