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Quicksilver Resources Inc (NYSE:KWK)
Beneish M-Score
-2.31 (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.

Quicksilver Resources Inc has a M-score of -2.31 suggests that the company is not a manipulator.

KWK' s 10-Year Beneish M-Score Range
Min: -11.36   Max: 1.06
Current: -2.31

-11.36
1.06

During the past 13 years, the highest Beneish M-Score of Quicksilver Resources Inc was 1.06. The lowest was -11.36. And the median was -2.82.


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 Quicksilver Resources Inc 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 * 2.0666+0.528 * 1.1934+0.404 * 0.5743+0.892 * 0.7499+0.115 * 1.4506
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9187+4.679 * -0.1103-0.327 * 1.219
=-2.31

* 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 $69.6 Mil.
Revenue was 118.032 + 91.786 + 114.244 + 153.116 = $477.2 Mil.
Gross Profit was 40.602 + 18.87 + 60.106 + 79.166 = $198.7 Mil.
Total Current Assets was $180.1 Mil.
Total Assets was $1,059.0 Mil.
Property, Plant and Equipment(Net PPE) was $815.3 Mil.
Depreciation, Depletion and Amortization(DDA) was $57.7 Mil.
Selling, General & Admin. Expense(SGA) was $49.1 Mil.
Total Current Liabilities was $139.9 Mil.
Long-Term Debt was $1,795.6 Mil.
Net Income was -36.095 + -58.833 + -31.779 + 10.577 = $-116.1 Mil.
Non Operating Income was -8.966 + -4.332 + -7.551 + -4.151 = $-25.0 Mil.
Cash Flow from Operations was 19.221 + -19.984 + 29.403 + -2.997 = $25.6 Mil.
Accounts Receivable was $44.9 Mil.
Revenue was 175.497 + 118.703 + 223.966 + 118.188 = $636.4 Mil.
Gross Profit was 94.631 + 31.982 + 163.081 + 26.6 = $316.3 Mil.
Total Current Assets was $355.5 Mil.
Total Assets was $1,394.2 Mil.
Property, Plant and Equipment(Net PPE) was $892.9 Mil.
Depreciation, Depletion and Amortization(DDA) was $94.7 Mil.
Selling, General & Admin. Expense(SGA) was $71.2 Mil.
Total Current Liabilities was $121.8 Mil.
Long-Term Debt was $1,968.4 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)
=(69.556 / 477.178) / (44.885 / 636.354)
=0.14576531 / 0.07053464
=2.0666

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)
=(18.87 / 636.354) / (40.602 / 477.178)
=0.49704096 / 0.41649867
=1.1934

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 - (180.116 + 815.331) / 1059.047) / (1 - (355.507 + 892.85) / 1394.151)
=0.06005399 / 0.10457547
=0.5743

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
=477.178 / 636.354
=0.7499

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))
=(94.69 / (94.69 + 892.85)) / (57.706 / (57.706 + 815.331))
=0.09588472 / 0.066098
=1.4506

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)
=(49.073 / 477.178) / (71.235 / 636.354)
=0.10284003 / 0.11194241
=0.9187

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)
=((1795.644 + 139.949) / 1059.047) / ((1968.407 + 121.84) / 1394.151)
=1.82767431 / 1.49929742
=1.219

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
=(-116.13 - -25 - 25.643) / 1059.047
=-0.1103

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.

Quicksilver Resources Inc has a M-score of -2.31 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.

Quicksilver Resources Inc Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 1.13651.15860.79950.82021.11330.42760.8920.88821.4111.0474
GMI 0.98430.87951.00610.98610.89781.041.1051.23371.04431.1478
AQI 1.15920.64071.23199.20050.42783.45620.24890.99921.79050.7986
SGI 1.27511.72731.25741.43781.42651.04011.11481.01650.75140.792
DEPI 1.09321.02461.05490.86151.12960.64341.15991.0330.44642.0233
SGAI 1.24860.84441.06821.27681.07631.02780.93030.97731.26590.9225
LVGI 1.09921.06361.02810.7111.58151.10130.85530.89012.8830.9603
TATA -0.0621-0.0471-0.0686-0.1475-0.1353-0.3161-0.0143-0.0937-1.85410.1825
M-score -2.41-2.11-2.670.39-3.10-3.52-2.71-2.84-11.38-1.63

Quicksilver Resources Inc Quarterly Data

Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14
DSRI 0.83010.99091.50411.4111.26490.9270.85761.04741.3532.0666
GMI 1.21471.2151.3161.09171.13111.09550.86331.14781.08181.1934
AQI 1.2022.88681.36961.79051.86930.98761.44980.79860.70180.5743
SGI 0.98470.90580.73730.75140.72420.74880.94790.7920.81640.7499
DEPI 1.02590.7880.71650.44640.55370.81831.07632.02331.76631.4506
SGAI 1.04561.19621.23031.26591.25151.14730.93440.92250.91680.9187
LVGI 0.85711.16611.50762.8833.0432.05521.63150.96030.98411.219
TATA -0.1346-0.4054-0.8409-1.8541-1.8087-0.7786-0.18080.2460.2721-0.1103
M-score -3.04-3.71-6.11-11.36-11.29-6.76-3.58-1.33-1.02-2.31
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