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ArcelorMittal SA (NYSE:MT)
Beneish M-Score
-2.37 (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.

ArcelorMittal SA has a M-score of -2.43 suggests that the company is not a manipulator.

MT' s Beneish M-Score Range Over the Past 10 Years
Min: -83.75   Max: 0.11
Current: -2.37

-83.75
0.11

During the past 13 years, the highest Beneish M-Score of ArcelorMittal SA was 0.11. The lowest was -83.75. 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 ArcelorMittal SA 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 * 0.9177+0.528 * 2.3074+0.404 * 0.9952+0.892 * 0.7928+0.115 * 0.4667
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0+4.679 * -0.1072-0.327 * 0.9708
=-2.43

* 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 $3,116 Mil.
Revenue was 14743 + 13399 + 13981 + 15589 = $57,712 Mil.
Gross Profit was 14743 + 13399 + -48784 + 44710 = $24,068 Mil.
Total Current Assets was $20,768 Mil.
Total Assets was $75,019 Mil.
Property, Plant and Equipment(Net PPE) was $35,978 Mil.
Depreciation, Depletion and Amortization(DDA) was $7,710 Mil.
Selling, General & Admin. Expense(SGA) was $0 Mil.
Total Current Liabilities was $15,754 Mil.
Long-Term Debt was $14,019 Mil.
Net Income was 1112 + -416 + -6686 + -711 = $-6,701 Mil.
Non Operating Income was 160 + 333 + -997 + -379 = $-883 Mil.
Cash Flow from Operations was 869 + -690 + 1574 + 473 = $2,226 Mil.
Accounts Receivable was $4,283 Mil.
Revenue was 16890 + 17118 + 18723 + 20067 = $72,798 Mil.
Gross Profit was 16070 + 17118 + 17741 + 19121 = $70,050 Mil.
Total Current Assets was $26,887 Mil.
Total Assets was $91,932 Mil.
Property, Plant and Equipment(Net PPE) was $42,545 Mil.
Depreciation, Depletion and Amortization(DDA) was $3,819 Mil.
Selling, General & Admin. Expense(SGA) was $16,908 Mil.
Total Current Liabilities was $19,553 Mil.
Long-Term Debt was $18,031 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)
=(3116 / 57712) / (4283 / 72798)
=0.05399224 / 0.05883403
=0.9177

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)
=(70050 / 72798) / (24068 / 57712)
=0.96225171 / 0.41703632
=2.3074

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 - (20768 + 35978) / 75019) / (1 - (26887 + 42545) / 91932)
=0.24357829 / 0.24474612
=0.9952

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
=57712 / 72798
=0.7928

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))
=(3819 / (3819 + 42545)) / (7710 / (7710 + 35978))
=0.08236994 / 0.17647867
=0.4667

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)
=(0 / 57712) / (16908 / 72798)
=0 / 0.23225913
=0

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)
=((14019 + 15754) / 75019) / ((18031 + 19553) / 91932)
=0.39687279 / 0.40882391
=0.9708

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
=(-6701 - -883 - 2226) / 75019
=-0.1072

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.

ArcelorMittal SA has a M-score of -2.43 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.

ArcelorMittal SA Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
DSRI 1.83230.60830.59521.74750.77870.93570.87951.01860.7580.9039
GMI 1.1550.92541.2724.18790.40640.954211.7180.15070.6981-2.9708
AQI 1.62071.18641.08681.26310.9581.01260.95050.96681.03220.9851
SGI 2.09261.78731.18740.48841.27871.20440.89610.94330.9980.8019
DEPI 1.35180.59490.88861.09730.94110.93820.99250.95721.07420.9522
SGAI 1.33191.0271.02151.14210.70970.88531.040.95810.991.0713
LVGI 1.02310.99091.03970.81881.10461.0211.02990.9631.00061.1939
TATA -0.0217-0.056-0.0453-0.0457-0.0112-0.0004-0.0779-0.0451-0.0289-0.1043
M-score -0.53-2.41-2.75-0.63-2.81-2.372.57-3.17-2.98-5.42

ArcelorMittal SA Quarterly Data

Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16
DSRI 0.92520.88550.83980.7580.79540.89460.87840.90391.00060.9177
GMI -0.4055-0.7469-0.67690.05480.07040.07980.06092.1052.26922.3074
AQI 1.02091.06241.02591.02681.01580.98511.00570.9860.96680.9952
SGI 0.9781.01271.01910.9980.9640.91020.84970.80190.78130.7928
DEPI 0.97961.04861.04721.01460.96530.9610.93790.45490.4860.4667
SGAI -16.938228.836137.590811.9895-2.4481-1.2597-0.609000
LVGI 1.00880.97831.03121.00061.03581.0741.07641.19391.12160.9708
TATA -0.0411-0.03-0.0349-0.0289-0.0286-0.0233-0.0359-0.1043-0.1178-0.1072
M-score -0.41-8.39-9.95-5.22-2.74-2.90-3.14-2.61-2.50-2.43
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