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Invesco Ltd (NYSE:IVZ)
Beneish M-Score
-2.49 (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 -2.49 suggests that the company is not a manipulator.

IVZ' s 10-Year Beneish M-Score Range
Min: -3   Max: -1.67
Current: -2.49

-3
-1.67

During the past 13 years, the highest Beneish M-Score of Invesco Ltd was -1.67. The lowest was -3.00. And the median was -2.43.


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 * 0.9803+0.528 * 1+0.404 * 1.0648+0.892 * 1.1504+0.115 * 0.9128
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.98+4.679 * -0.0283-0.327 * 1.0534
=-2.49

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

This Year (Jun14) TTM:Last Year (Jun13) TTM:
Accounts Receivable was $1,868 Mil.
Revenue was 1289.9 + 1269.5 + 1225.1 + 1171.8 = $4,956 Mil.
Gross Profit was 1289.9 + 1269.5 + 1225.1 + 1171.8 = $4,956 Mil.
Total Current Assets was $4,603 Mil.
Total Assets was $19,900 Mil.
Property, Plant and Equipment(Net PPE) was $355 Mil.
Depreciation, Depletion and Amortization(DDA) was $134 Mil.
Selling, General & Admin. Expense(SGA) was $3,778 Mil.
Total Current Liabilities was $8,481 Mil.
Long-Term Debt was $1,589 Mil.
Net Income was 274.5 + 187.8 + 287.4 + 228.1 = $978 Mil.
Non Operating Income was 66.2 + 51.3 + 41.2 + 51.2 = $210 Mil.
Cash Flow from Operations was 769.5 + -219.2 + 192.7 + 587.5 = $1,331 Mil.
Accounts Receivable was $1,657 Mil.
Revenue was 1135.5 + 1112.2 + 1046.7 + 1013.9 = $4,308 Mil.
Gross Profit was 1135.5 + 1112.2 + 1046.7 + 1013.9 = $4,308 Mil.
Total Current Assets was $5,019 Mil.
Total Assets was $18,139 Mil.
Property, Plant and Equipment(Net PPE) was $329 Mil.
Depreciation, Depletion and Amortization(DDA) was $110 Mil.
Selling, General & Admin. Expense(SGA) was $3,351 Mil.
Total Current Liabilities was $3,430 Mil.
Long-Term Debt was $5,284 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)
=(1868.3 / 4956.3) / (1656.7 / 4308.3)
=0.37695458 / 0.38453682
=0.9803

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)
=(1269.5 / 4308.3) / (1289.9 / 4956.3)
=1 / 1
=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 - (4602.6 + 354.8) / 19899.5) / (1 - (5018.7 + 328.8) / 18138.6)
=0.75087816 / 0.70518673
=1.0648

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
=4956.3 / 4308.3
=1.1504

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))
=(109.9 / (109.9 + 328.8)) / (134.2 / (134.2 + 354.8))
=0.25051288 / 0.27443763
=0.9128

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)
=(3777.9 / 4956.3) / (3351 / 4308.3)
=0.762242 / 0.77780099
=0.98

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)
=((1588.9 + 8480.8) / 19899.5) / ((5283.9 + 3429.7) / 18138.6)
=0.50602779 / 0.48038989
=1.0534

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
=(977.8 - 209.9 - 1330.5) / 19899.5
=-0.0283

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 -2.49 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

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 0.82261.09830.88530.60231.55891.22890.75161.09751.2379
GMI 111111111
AQI 0.94561.10240.97221.1120.9431.12091.01040.9630.5577
SGI 1.35221.13021.19470.85270.79431.32751.17331.02071.1119
DEPI 1.01821.35770.96561.06010.95220.99290.961.27721.0616
SGAI 0.76770.93880.98561.13621.05391.01860.93941.01390.9589
LVGI 1.02050.71181.07090.79890.91811.83110.96680.90251.1067
TATA 0.0076-0.0056-0.02090.00070.0029-0.0041-0.0091-0.00470.003
M-score -2.28-2.11-2.55-2.88-2.15-2.22-2.58-2.35-2.35

Invesco Ltd Quarterly Data

Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14
DSRI 0.78240.7960.95771.11721.16611.55231.31891.2161.27440.9803
GMI 1111111111
AQI 1.00451.0160.95451.03230.92410.89750.58150.52031.01941.0648
SGI 1.07970.98990.9831.00271.02031.0671.10181.13191.14831.1504
DEPI 1.04040.73470.84230.70910.6831.59981.18791.40291.39310.9128
SGAI 0.94970.98741.00471.01611.01050.99210.97440.95680.97890.98
LVGI 0.94010.89710.86970.9290.99091.01580.60231.07511.04261.0534
TATA -0.0043-0.00030.01790.01330.0264-0.0062-0.0333-0.0103-0.0268-0.0283
M-score -2.59-2.67-2.45-2.31-2.25-1.92-2.26-2.38-2.18-2.49
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