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JPMorgan Chase & Co (NYSE:JPM)
Beneish M-Score
0.00 (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.

JPMorgan Chase & Co has a M-score of signals that the company is a manipulator.

JPM' s 10-Year Beneish M-Score Range
Min: 0   Max: 0
Current: 0

During the past 13 years, the highest Beneish M-Score of JPMorgan Chase & Co was 0.00. The lowest was 0.00. And the median was 0.00.


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 JPMorgan Chase & Co 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 (Sep14) TTM:Last Year (Sep13) TTM:
Accounts Receivable was $75,504 Mil.
Revenue was 24246 + 24454 + 22993 + 23156 = $94,849 Mil.
Gross Profit was 0 + 0 + 0 + 0 = $0 Mil.
Total Current Assets was $0 Mil.
Total Assets was $2,527,005 Mil.
Property, Plant and Equipment(Net PPE) was $15,177 Mil.
Depreciation, Depletion and Amortization(DDA) was $4,819 Mil.
Selling, General & Admin. Expense(SGA) was $38,606 Mil.
Total Current Liabilities was $0 Mil.
Long-Term Debt was $300,613 Mil.
Net Income was 5572 + 5985 + 5274 + 5278 = $22,109 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0 Mil.
Cash Flow from Operations was -2449 + -4371 + 14667 + -6914 = $933 Mil.
Accounts Receivable was $66,269 Mil.
Revenue was 23117 + 25211 + 25122 + 23653 = $97,103 Mil.
Gross Profit was 0 + 0 + 0 + 0 = $0 Mil.
Total Current Assets was $0 Mil.
Total Assets was $2,463,309 Mil.
Property, Plant and Equipment(Net PPE) was $14,876 Mil.
Depreciation, Depletion and Amortization(DDA) was $5,464 Mil.
Selling, General & Admin. Expense(SGA) was $38,611 Mil.
Total Current Liabilities was $0 Mil.
Long-Term Debt was $293,808 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)
=(75504 / 94849) / (66269 / 97103)
=0.79604424 / 0.68246089
=

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)
=(0 / 97103) / (0 / 94849)
=0 / 0
=

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 - (0 + 15177) / 2527005) / (1 - (0 + 14876) / 2463309)
=0.99399408 / 0.99396097
=

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
=94849 / 97103
=

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))
=(5464 / (5464 + 14876)) / (4819 / (4819 + 15177))
=0.26863324 / 0.2409982
=

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)
=(38606 / 94849) / (38611 / 97103)
=0.4070259 / 0.39762932
=

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)
=((300613 + 0) / 2527005) / ((293808 + 0) / 2463309)
=0.11896019 / 0.11927371
=

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
=(22109 - 0 - 933) / 2527005
=0.0084

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.

JPMorgan Chase & Co 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.

JPMorgan Chase & Co Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI
GMI
AQI
SGI
DEPI
SGAI
LVGI
TATA
M-score

JPMorgan Chase & Co Quarterly Data

Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14
DSRI
GMI
AQI
SGI
DEPI
SGAI
LVGI
TATA
M-score
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