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InterOil Corp (NYSE:IOC)
Beneish M-Score
-2.01 (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: 1325.19
Current: -2.01

-11.21
1325.19

During the past 13 years, the highest Beneish M-Score of InterOil Corp was 1325.19. The lowest was -11.21. And the median was -1.85.


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 own currency.

This Year (Jun16) TTM:Last Year (Jun15) TTM:
Accounts Receivable was $549.41 Mil.
Revenue was -10.696 + 0.921 + 11.689 + 11.822 = $13.74 Mil.
Gross Profit was -10.696 + 0.921 + 11.689 + 11.822 = $13.74 Mil.
Total Current Assets was $568.82 Mil.
Total Assets was $1,150.09 Mil.
Property, Plant and Equipment(Net PPE) was $555.48 Mil.
Depreciation, Depletion and Amortization(DDA) was $1.01 Mil.
Selling, General & Admin. Expense(SGA) was $77.66 Mil.
Total Current Liabilities was $318.11 Mil.
Long-Term Debt was $0.00 Mil.
Net Income was -57.546 + -16.978 + -83.83 + -103.725 = $-262.08 Mil.
Non Operating Income was 1.286 + -1.415 + -90.703 + -13.812 = $-104.64 Mil.
Cash Flow from Operations was -48.571 + -14.418 + -39.124 + -16.7 = $-118.81 Mil.
Accounts Receivable was $ Mil.
Revenue was -13.643 + 13.215 + -13.182 + 10.749 = $ 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)
=(549.411 / 13.736) / ( / -2.861)
=39.99788876 /
=

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)
=( / -2.861) / (13.736 / 13.736)
= / 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 - (568.815 + 555.479) / 1150.086) / (1 - ( + 482.244) / )
=0.02242615 /
=

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
=13.736 / -2.861
=

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))
=(1.532 / (1.532 + 482.244)) / (1.013 / (1.013 + 555.479))
= / 0.00182033
=

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)
=(77.658 / 13.736) / ( / -2.861)
=5.65361095 /
=

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 + 318.106) / 1150.086) / (( + ) / )
=0.27659323 /
=

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
=(-262.079 - -104.644 - -118.813) / 1150.086
=-0.0336

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 own currency.

InterOil Corp Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
DSRI 1.26190.76830.46551.89350.67432.03050.70360.784621.29760.585
GMI 0.91920.46172.1060.24971.19611.25131.49120.58490.10041
AQI 2.3350.48020.93978.40380.59331.7041.45311.22950.26010.9369
SGI 1.07141.21691.4590.75351.16441.38661.18021.06030.00941.7542
DEPI 1.05251.00181.051.10121.22730.89381.15961.00540.78233.8074
SGAI 1.25951.52610.69871.20290.9730.99870.59010.996116.20780.4966
LVGI 1.13240.96890.75910.60150.9820.94821.42910.96060.45191.5877
TATA -0.08250.0044-0.1108-0.0603-0.0329-0.06180.0258-0.05840.0479-0.0277
M-score -2.15-3.05-2.380.54-2.81-1.05-2.08-3.01547.101.32

InterOil Corp Quarterly Data

Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16
DSRI 0.4330.15313.733225.3638488.34341448.672130.417614.3312.18821.6727
GMI 0.4440.58440.45440.56870.10680.130.15450.160111
AQI 4.96665.59320.39940.26010.05850.05160.68290.93690.94670.9844
SGI 1.02110.7460.54090.23020.018-0.0028-0.00240.07160.44090.5613
DEPI 0.41290.25220.44420.78213.741735.781741.615533.933612.62339.3139
SGAI 1.19781.47922.38025.239348.562937.750425.202811.01572.28092.8066
LVGI 0.90740.34930.35270.45190.51681.55491.8861.58771.59461.7223
TATA -0.0223-0.02820.02160.0590.07680.011-0.0827-0.0277-0.0536-0.0336
M-score -1.85-1.948.3118.42436.801,325.1922.9510.23-1.24-2.01
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