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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.
During the past 13 years, the highest Beneish M-Score of Manitowoc Co Inc was -1.37. The lowest was -4.25. And the median was -2.52.
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 Manitowoc Co 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 * 0.3606||+||0.528 * 0.8469||+||0.404 * 0.5988||+||0.892 * 1.4187||+||0.115 * 0.4304|
|-||0.172 * SGAI||+||4.679 * TATA||-||0.327 * LVGI|
|-||0.172 * 1.0063||+||4.679 * -0.126||-||0.327 * 0.6917|
|This Year (Sep16) TTM:||Last Year (Sep15) TTM:|
|Accounts Receivable was $133 Mil.|
Revenue was 349.8 + 457.7 + 427.4 + 2113.2 = $3,348 Mil.
Gross Profit was 41.5 + 88.2 + 81.9 + 593 = $805 Mil.
Total Current Assets was $787 Mil.
Total Assets was $1,599 Mil.
Property, Plant and Equipment(Net PPE) was $315 Mil.
Depreciation, Depletion and Amortization(DDA) was $103 Mil.
Selling, General & Admin. Expense(SGA) was $567 Mil.
Total Current Liabilities was $436 Mil.
Long-Term Debt was $293 Mil.
Net Income was -140 + -4.9 + -204 + 43.8 = $-305 Mil.
Non Operating Income was 0 + 1.7 + -71.8 + 24.1 = $-46 Mil.
Cash Flow from Operations was -3 + -16.4 + -210.1 + 171.9 = $-58 Mil.
|Accounts Receivable was $259 Mil.
Revenue was 438.2 + 477.7 + 406.7 + 1037.4 = $2,360 Mil.
Gross Profit was 69.9 + 94.9 + 75.4 + 240.1 = $480 Mil.
Total Current Assets was $1,277 Mil.
Total Assets was $3,805 Mil.
Property, Plant and Equipment(Net PPE) was $552 Mil.
Depreciation, Depletion and Amortization(DDA) was $65 Mil.
Selling, General & Admin. Expense(SGA) was $397 Mil.
Total Current Liabilities was $931 Mil.
Long-Term Debt was $1,575 Mil.
1. DSRI = Days Sales in Receivables Index
A large increase in DSR could be indicative of revenue inflation.
|DSRI||=||(Receivables_t / Revenue_t)||/||(Receivables_t-1 / Revenue_t-1)|
|=||(132.5 / 3348.1)||/||(259 / 2360)|
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.
|=||(GrossProfit_t-1 / Revenue_t-1)||/||(GrossProfit_t / Revenue_t)|
|=||(480.3 / 2360)||/||(804.6 / 3348.1)|
3. AQI = Asset Quality Index
AQI is the ratio of asset quality in year t to year t-1.
|AQI||=||(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t)||/||(1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)|
|=||(1 - (786.6 + 315.3) / 1599.2)||/||(1 - (1277.2 + 551.8) / 3804.8)|
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.
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))|
|=||(65.2 / (65.2 + 551.8))||/||(102.6 / (102.6 + 315.3))|
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)|
|=||(566.6 / 3348.1)||/||(396.9 / 2360)|
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)|
|=||((293 + 435.7) / 1599.2)||/||((1575.3 + 931) / 3804.8)|
8. TATA = Total Accruals to Total Assets
Total accruals calculated as the change in working capital accounts other than cash less depreciation.
|=||(NetIncome_t - NonOperatingIncome_t||-||CashFlowsfromOperations_t)||/||TotalAssets_t|
|=||(-305.1 - -46||-||-57.6)||/||1599.2|
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.
Manitowoc Co Inc has a M-score of -3.49 suggests that the company will not be a manipulator.
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
Manitowoc Co Inc Annual Data
Manitowoc Co Inc Quarterly Data