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InterOil Corp (NYSE:IOC)
Beneish M-Score
-1.86 (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.

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

IOC' s Beneish M-Score Range Over the Past 10 Years
Min: -11.21   Max: 951.6
Current: -1.86

-11.21
951.6

During the past 13 years, the highest Beneish M-Score of InterOil Corp was 951.60. The lowest was -11.21. And the median was -1.44.


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 InterOil 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 * +0.528 * +0.404 * +0.892 * +0.115 *
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * +4.679 * -0.327 *
=

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

This Year (Sep16) TTM:Last Year (Sep15) TTM:
Accounts Receivable was $556.33 Mil.
Revenue was 7.164 + -10.696 + 0.921 + 11.689 = $9.08 Mil.
Gross Profit was 7.164 + -10.696 + 0.921 + 11.689 = $9.08 Mil.
Total Current Assets was $578.53 Mil.
Total Assets was $1,178.40 Mil.
Property, Plant and Equipment(Net PPE) was $573.53 Mil.
Depreciation, Depletion and Amortization(DDA) was $1.13 Mil.
Selling, General & Admin. Expense(SGA) was $95.89 Mil.
Total Current Liabilities was $364.50 Mil.
Long-Term Debt was $0.00 Mil.
Net Income was -25.682 + -57.546 + -16.978 + -83.83 = $-184.04 Mil.
Non Operating Income was -8.023 + 1.286 + -1.415 + -12.467 = $-20.62 Mil.
Cash Flow from Operations was -38.537 + -48.571 + -14.418 + -39.124 = $-140.65 Mil.
Accounts Receivable was $ Mil.
Revenue was 11.822 + -13.643 + 13.215 + -13.182 = $ Mil.
Gross Profit was + + + = $ Mil.
Total Current Assets was $ Mil.
Total Assets was $ Mil.
Property, Plant and Equipment(Net PPE) was $ Mil.
Depreciation, Depletion and Amortization(DDA) was $ Mil.
Selling, General & Admin. Expense(SGA) was $ Mil.
Total Current Liabilities was $ Mil.
Long-Term Debt was $ 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)
=(556.333 / 9.078) / ( / -1.788)
=61.28365279 /
=

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)
=( / -1.788) / (9.078 / 9.078)
= / 1
=

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 - (578.531 + 573.532) / 1178.399) / (1 - ( + 470.027) / )
=0.02234897 /
=

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
=9.078 / -1.788
=

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))
=(0.728 / (0.728 + 470.027)) / (1.13 / (1.13 + 573.532))
= / 0.00196637
=

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)
=(95.892 / 9.078) / ( / -1.788)
=10.56311963 /
=

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 + 364.503) / 1178.399) / (( + ) / )
=0.30932053 /
=

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
=(-184.036 - -20.619 - -140.65) / 1178.399
=-0.0193

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.

InterOil Corp has a M-score of 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 local exchange's currency.

InterOil Corp Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
DSRI 1.26190.76830.46551.89350.68771.689151.14632.30371.160.585
GMI 0.91920.46172.1060.24971.19611.25130.0876111
AQI 2.3350.48020.93978.40380.75891.16881.53171.32940.26010.9369
SGI 1.07141.21691.4590.75351.16441.38660.00930.2654.76431.7542
DEPI 1.05251.00181.051.10121.2170.90241.15221.01060.78233.8074
SGAI 1.25951.52610.63971.31370.9730.681952.03484.9740.38650.4966
LVGI 1.13240.96890.96230.47670.83831.0971.16431.18820.45191.5877
TATA -0.08250.0044-0.0447-0.0603-0.0328-0.03860.0352-0.08580.0479-0.0277
M-score -2.15-3.05-2.130.56-2.69-1.47125.85-2.951.211.32

InterOil Corp Quarterly Data

Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16
DSRI 0.15053.2007148.04741.45823.82431.12050.5852.18821.67272.5629
GMI 0.40610.40610.1071111111
AQI 5.69360.45360.26010.05850.05160.68290.93690.94670.98440.981
SGI 0.74861.19680.03736.0229-0.1691-0.06611.75420.44090.56130.371
DEPI 0.23110.40690.78213.741735.781741.615533.933612.62339.31398.6222
SGAI 2.42681.818942.03630.22710.8571.14340.49662.28092.80665.2438
LVGI 0.32770.32520.45190.51681.55491.8861.58771.59461.72231.9261
TATA -0.04510.01690.04790.07220.0004-0.0327-0.0277-0.0536-0.0336-0.0193
M-score -2.23-0.72124.492.9920.940.761.34-1.24-2.01-1.86
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