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Invesco Ltd (NYSE:IVZ)
Beneish M-Score
-2.55 (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.

Invesco Ltd has a M-score of -2.57 suggests that the company is not a manipulator.

IVZ' s Beneish M-Score Range Over the Past 10 Years
Min: -3.48   Max: -0.54
Current: -2.55

-3.48
-0.54

During the past 13 years, the highest Beneish M-Score of Invesco Ltd was -0.54. The lowest was -3.48. And the median was -2.47.


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 Invesco Ltd 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 * 1.1744+0.528 * 0.9611+0.404 * 0.6451+0.892 * 0.9334+0.115 * 0.9736
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0157+4.679 * 0.0035-0.327 * 1.1101
=-2.57

* 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 $698 Mil.
Revenue was 1189.4 + 1148.7 + 1239.7 + 1273.5 = $4,851 Mil.
Gross Profit was 0 + 0 + 1239.7 + 1273.5 = $2,513 Mil.
Total Current Assets was $11,246 Mil.
Total Assets was $23,503 Mil.
Property, Plant and Equipment(Net PPE) was $432 Mil.
Depreciation, Depletion and Amortization(DDA) was $98 Mil.
Selling, General & Admin. Expense(SGA) was $3,619 Mil.
Total Current Liabilities was $9,154 Mil.
Long-Term Debt was $5,602 Mil.
Net Income was 225.5 + 161 + 201.9 + 249.3 = $838 Mil.
Non Operating Income was 38.3 + -24.4 + -16.8 + -11.8 = $-15 Mil.
Cash Flow from Operations was 243.4 + -68.8 + 497.9 + 97.1 = $770 Mil.
Accounts Receivable was $637 Mil.
Revenue was 1318.1 + 1291.6 + 1276.7 + 1311 = $5,197 Mil.
Gross Profit was 0 + 0 + 1276.7 + 1311 = $2,588 Mil.
Total Current Assets was $4,630 Mil.
Total Assets was $22,898 Mil.
Property, Plant and Equipment(Net PPE) was $410 Mil.
Depreciation, Depletion and Amortization(DDA) was $90 Mil.
Selling, General & Admin. Expense(SGA) was $3,818 Mil.
Total Current Liabilities was $5,921 Mil.
Long-Term Debt was $7,030 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)
=(698.4 / 4851.3) / (637.1 / 5197.4)
=0.14396141 / 0.12258052
=1.1744

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)
=(2587.7 / 5197.4) / (2513.2 / 4851.3)
=0.49788356 / 0.51804671
=0.9611

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 - (11245.6 + 432.1) / 23502.8) / (1 - (4630 + 410.3) / 22898.3)
=0.5031358 / 0.77988322
=0.6451

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
=4851.3 / 5197.4
=0.9334

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))
=(89.6 / (89.6 + 410.3)) / (97.5 / (97.5 + 432.1))
=0.17923585 / 0.18410121
=0.9736

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)
=(3619.1 / 4851.3) / (3817.5 / 5197.4)
=0.74600623 / 0.73450187
=1.0157

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)
=((5602.3 + 9153.7) / 23502.8) / ((7029.6 + 5920.7) / 22898.3)
=0.62784009 / 0.56555727
=1.1101

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
=(837.7 - -14.7 - 769.6) / 23502.8
=0.0035

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.

Invesco Ltd has a M-score of -2.57 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.

Invesco Ltd Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
DSRI 0.48120.86340.62111.5221.51940.78481.00310.91391.14140.9968
GMI 1111111111
AQI 1.10240.97221.1120.9431.12091.01041.03230.82321.14791.0421
SGI 1.13021.19470.85270.79431.32751.14181.01711.14671.10820.9953
DEPI 1.35770.96561.06010.95220.99290.961.27721.06161.10771.0105
SGAI 0.93880.98561.13621.05391.01860.9371.01730.95810.99090.9773
LVGI 0.71181.07090.79890.91811.83110.96680.9291.12730.99991.2064
TATA -0.0244-0.03960.00070.0029-0.0041-0.0091-0.00470.003-0.0155-0.0037
M-score -2.77-2.65-2.86-2.18-1.96-2.57-2.42-2.51-2.25-2.55

Invesco Ltd Quarterly Data

Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16
DSRI 1.06830.92961.06051.14140.83640.951.00890.99681.05461.1744
GMI 11111.33312.00852.02332.03841.48640.9611
AQI 1.01941.06481.13121.14790.86531.03861.02141.04211.25210.6451
SGI 1.15581.15041.14091.10821.07651.04861.01260.99530.96340.9334
DEPI 1.04321.04631.06021.10771.12561.12891.09831.01051.01010.9736
SGAI 0.97970.980.98870.99090.95250.96360.95780.97731.00711.0157
LVGI 1.04261.05341.07880.99991.12441.11761.17491.20641.0621.1101
TATA -0.0142-0.0154-0.0188-0.0155-0.0192-0.00540.0108-0.005-0.00550.0035
M-score -2.34-2.47-2.35-2.25-2.55-1.98-1.90-2.01-2.15-2.57
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