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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 -2.51.
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 * 0.8689||+||0.528 * 1.0239||+||0.404 * 0.529||+||0.892 * 0.9035||+||0.115 * 0.7029|
|-||0.172 * SGAI||+||4.679 * TATA||-||0.327 * LVGI|
|-||0.172 * 0.9956||+||4.679 * -0.0569||-||0.327 * 0.6565|
|This Year (Mar16) TTM:||Last Year (Mar15) TTM:|
|Accounts Receivable was $186 Mil.|
Revenue was 427.4 + 934.8 + 863.5 + 885.4 = $3,111 Mil.
Gross Profit was 81.9 + 222.5 + 205.7 + 222.5 = $733 Mil.
Total Current Assets was $899 Mil.
Total Assets was $1,820 Mil.
Property, Plant and Equipment(Net PPE) was $417 Mil.
Depreciation, Depletion and Amortization(DDA) was $105 Mil.
Selling, General & Admin. Expense(SGA) was $501 Mil.
Total Current Liabilities was $527 Mil.
Long-Term Debt was $269 Mil.
Net Income was -204 + 43.8 + 4.8 + 23.3 = $-132 Mil.
Non Operating Income was -71.8 + 19.9 + -2.1 + 1.9 = $-52 Mil.
Cash Flow from Operations was -210.1 + 171.9 + 6.3 + 55.5 = $24 Mil.
|Accounts Receivable was $236 Mil.
Revenue was 406.7 + 1037.4 + 986.3 + 1012.8 = $3,443 Mil.
Gross Profit was 75.4 + 240.1 + 243.9 + 270.8 = $830 Mil.
Total Current Assets was $1,251 Mil.
Total Assets was $3,817 Mil.
Property, Plant and Equipment(Net PPE) was $566 Mil.
Depreciation, Depletion and Amortization(DDA) was $93 Mil.
Selling, General & Admin. Expense(SGA) was $557 Mil.
Total Current Liabilities was $934 Mil.
Long-Term Debt was $1,608 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)|
|=||(185.6 / 3111.1)||/||(236.4 / 3443.2)|
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)|
|=||(830.2 / 3443.2)||/||(732.6 / 3111.1)|
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 - (899 + 416.9) / 1820.4)||/||(1 - (1251.2 + 566) / 3816.9)|
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))|
|=||(92.9 / (92.9 + 566))||/||(104.6 / (104.6 + 416.9))|
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)|
|=||(501.4 / 3111.1)||/||(557.4 / 3443.2)|
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)|
|=||((269.3 + 526.6) / 1820.4)||/||((1607.7 + 934.4) / 3816.9)|
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|
|=||(-132.1 - -52.1||-||23.6)||/||1820.4|
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 -3.05 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