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MicroFinancial Inc (NAS:MFI)
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.

MicroFinancial Inc has a M-score of -4.62 suggests that the company is not a manipulator.

During the past 13 years, the highest Beneish M-Score of MicroFinancial Inc 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 MicroFinancial 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 * 1+0.528 * 1+0.404 * 1.0009+0.892 * 1.0239+0.115 * 1.023
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9966+4.679 * -0.4623-0.327 * 1.0061
=-4.62

* 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 $0.00 Mil.
Revenue was 16.235 + 15.798 + 15.698 + 15.806 = $63.54 Mil.
Gross Profit was 16.235 + 15.798 + 15.698 + 15.806 = $63.54 Mil.
Total Current Assets was $2.88 Mil.
Total Assets was $183.92 Mil.
Property, Plant and Equipment(Net PPE) was $1.70 Mil.
Depreciation, Depletion and Amortization(DDA) was $5.80 Mil.
Selling, General & Admin. Expense(SGA) was $19.12 Mil.
Total Current Liabilities was $90.92 Mil.
Long-Term Debt was $0.00 Mil.
Net Income was 2.887 + 2.488 + 2.112 + 2.451 = $9.94 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0.00 Mil.
Cash Flow from Operations was 24.98 + 20.466 + 26.549 + 22.971 = $94.97 Mil.
Accounts Receivable was $0.00 Mil.
Revenue was 15.743 + 15.674 + 15.295 + 15.34 = $62.05 Mil.
Gross Profit was 15.743 + 15.674 + 15.295 + 15.34 = $62.05 Mil.
Total Current Assets was $3.03 Mil.
Total Assets was $170.84 Mil.
Property, Plant and Equipment(Net PPE) was $1.36 Mil.
Depreciation, Depletion and Amortization(DDA) was $5.17 Mil.
Selling, General & Admin. Expense(SGA) was $18.74 Mil.
Total Current Liabilities was $83.93 Mil.
Long-Term Debt was $0.00 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)
=(0 / 63.537) / (0 / 62.052)
=0 / 0
=1

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)
=(15.798 / 62.052) / (16.235 / 63.537)
=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 - (2.875 + 1.698) / 183.92) / (1 - (3.03 + 1.364) / 170.837)
=0.97513593 / 0.97427958
=1.0009

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
=63.537 / 62.052
=1.0239

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))
=(5.169 / (5.169 + 1.364)) / (5.797 / (5.797 + 1.698))
=0.79121384 / 0.77344897
=1.023

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)
=(19.123 / 63.537) / (18.74 / 62.052)
=0.30097424 / 0.30200477
=0.9966

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 + 90.916) / 183.92) / ((0 + 83.933) / 170.837)
=0.49432362 / 0.49130458
=1.0061

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
=(9.938 - 0 - 94.966) / 183.92
=-0.4623

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.

MicroFinancial Inc has a M-score of -4.62 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.

MicroFinancial Inc Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 1111111111
GMI 1111111111
AQI 1.00281.00160.9980.89111.06611.04820.99360.99070.99321.0105
SGI 0.65920.65080.82580.97621.2481.1681.10321.07351.08491.054
DEPI 1.18810.77811.05761.40861.12380.80410.95261.16360.85350.9205
SGAI 1.20171.19650.84070.9060.8160.87660.93821.06841.01421.0057
LVGI 0.001288.84670.0021573.83712.93231.22861.08730.99311.00340.9503
TATA -0.9349-0.5483-0.3817-0.3415-0.3563-0.423-0.4764-0.4794-0.48-0.4763
M-score -6.84-34.14-4.06-518.40-4.49-4.37-4.64-4.65-4.67-4.65

MicroFinancial Inc Quarterly Data

Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14
DSRI 1111111111
GMI 1111111111
AQI 0.99751.0060.99320.99990.99760.99981.01050.99840.99651.0009
SGI 1.07581.08181.08491.08631.081.06861.0541.04231.02771.0239
DEPI 0.82590.82320.85350.88940.90170.9070.92050.92141.00591.023
SGAI 1.00670.99971.01421.00511.05821.0421.00571.0080.98830.9966
LVGI 1.01461.01521.00340.98140.97020.95170.95030.95610.9761.0061
TATA -0.4518-0.4595-0.48-0.4775-0.499-0.4973-0.4763-0.5116-0.476-0.4623
M-score -4.55-4.58-4.67-4.64-4.76-4.75-4.65-4.83-4.67-4.62
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