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IAC/InterActiveCorp (NAS:IACI)
Beneish M-Score
-2.44 (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 -2.44 suggests that the company is not a manipulator.

IACI' s 10-Year Beneish M-Score Range
Min: -4.57   Max: 84.96
Current: -2.44

-4.57
84.96

During the past 13 years, the highest Beneish M-Score of IAC/InterActiveCorp was 84.96. The lowest was -4.57. And the median was -2.35.


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 * 1.1421+0.528 * 0.927+0.404 * 0.9345+0.892 * 0.9802+0.115 * 1.0728
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.1149+4.679 * 0.0233-0.327 * 1.3172
=-2.44

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

This Year (Sep14) TTM:Last Year (Sep13) TTM:
Accounts Receivable was $235 Mil.
Revenue was 782.231 + 756.315 + 740.247 + 724.455 = $3,003 Mil.
Gross Profit was 556.039 + 545.215 + 531.053 + 501.881 = $2,134 Mil.
Total Current Assets was $1,455 Mil.
Total Assets was $4,238 Mil.
Property, Plant and Equipment(Net PPE) was $301 Mil.
Depreciation, Depletion and Amortization(DDA) was $115 Mil.
Selling, General & Admin. Expense(SGA) was $1,484 Mil.
Total Current Liabilities was $654 Mil.
Long-Term Debt was $1,080 Mil.
Net Income was 326.812 + -17.996 + 35.885 + 76.917 = $422 Mil.
Non Operating Income was 3.501 + -69.75 + -1.958 + 9.743 = $-58 Mil.
Cash Flow from Operations was 145.89 + 106.067 + 42.704 + 86.631 = $381 Mil.
Accounts Receivable was $210 Mil.
Revenue was 756.872 + 799.411 + 742.249 + 765.251 = $3,064 Mil.
Gross Profit was 508.016 + 526.589 + 486.4 + 497.333 = $2,018 Mil.
Total Current Assets was $1,130 Mil.
Total Assets was $3,805 Mil.
Property, Plant and Equipment(Net PPE) was $290 Mil.
Depreciation, Depletion and Amortization(DDA) was $122 Mil.
Selling, General & Admin. Expense(SGA) was $1,358 Mil.
Total Current Liabilities was $602 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)
=(235.035 / 3003.248) / (209.949 / 3063.783)
=0.07826027 / 0.06852607
=1.1421

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)
=(545.215 / 3063.783) / (556.039 / 3003.248)
=0.65877316 / 0.71062663
=0.927

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 - (1455.279 + 300.955) / 4238.41) / (1 - (1129.921 + 290.47) / 3804.782)
=0.58563848 / 0.62668269
=0.9345

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
=3003.248 / 3063.783
=0.9802

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))
=(122.492 / (122.492 + 290.47)) / (115.008 / (115.008 + 300.955))
=0.29661809 / 0.27648613
=1.0728

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)
=(1483.885 / 3003.248) / (1357.845 / 3063.783)
=0.49409339 / 0.44319229
=1.1149

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 + 653.693) / 4238.41) / ((580 + 601.551) / 3804.782)
=0.40904325 / 0.31054368
=1.3172

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
=(421.618 - -58.464 - 381.292) / 4238.41
=0.0233

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 -2.44 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

Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14
DSRI 1.20181.03930.95460.99820.92690.81730.83620.98460.96081.1421
GMI 0.97330.97360.97550.98450.99080.97510.96560.9460.92720.927
AQI 0.94811.06271.07031.06791.13420.96690.93150.90620.89490.9345
SGI 1.34531.37551.361.29591.24081.16381.07931.04080.98560.9802
DEPI 0.95121.08290.94640.97590.88380.77840.85490.86581.02651.0728
SGAI 0.99390.99751.0020.97540.97550.960.96381.0191.06051.1149
LVGI 1.3611.18541.71351.71781.60621.57791.24331.28391.28141.3172
TATA -0.0497-0.0597-0.0439-0.0491-0.0468-0.0306-0.0352-0.0269-0.02190.0233
M-score -2.38-2.43-2.63-2.66-2.71-2.88-2.86-2.76-2.81-2.44
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