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Beneish M-Score -0.55 higher than -2.22, which implies that it might have manipulated its financial results.
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 Nokia Oyj was 316315.23. The lowest was -4.55. And the median was -2.48.
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 Nokia Oyj 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 * 0.3445||+||0.528 * 1.9876||+||0.404 * 1.1418||+||0.892 * 2.6164||+||0.115 * 0.9791|
|-||0.172 * SGAI||+||4.679 * TATA||-||0.327 * LVGI|
|-||0.172 * 1.1423||+||4.679 * 0.0443||-||0.327 * 0.9038|
|This Year (Sep15) TTM:||Last Year (Sep14) TTM:|
|Accounts Receivable was $3,793 Mil.|
Revenue was 3407.40740741 + 3601.57126824 + 3458.87445887 + 4688.03945746 = $15,156 Mil.
Gross Profit was 1455.667789 + 1722.78338945 + 1468.61471861 + 2034.52527744 = $6,682 Mil.
Total Current Assets was $14,082 Mil.
Total Assets was $23,043 Mil.
Property, Plant and Equipment(Net PPE) was $749 Mil.
Depreciation, Depletion and Amortization(DDA) was $182 Mil.
Selling, General & Admin. Expense(SGA) was $1,976 Mil.
Total Current Liabilities was $6,824 Mil.
Long-Term Debt was $3,033 Mil.
Net Income was 170.594837262 + 389.450056117 + 191.558441558 + 547.472256473 = $1,299 Mil.
Non Operating Income was -2.24466891134 + -5.61167227834 + 20.5627705628 + -70.2836004932 = $-58 Mil.
Cash Flow from Operations was 564.534231201 + -289.562289562 + -215.367965368 + 276.202219482 = $336 Mil.
|Accounts Receivable was $4,209 Mil.
Revenue was 4283.50515464 + 3997.2826087 + 3684.6473029 + -6172.83950617 = $5,793 Mil.
Gross Profit was 1904.63917526 + 1758.15217391 + 1681.88105118 + -268.861454047 = $5,076 Mil.
Total Current Assets was $17,659 Mil.
Total Assets was $26,927 Mil.
Property, Plant and Equipment(Net PPE) was $863 Mil.
Depreciation, Depletion and Amortization(DDA) was $204 Mil.
Selling, General & Admin. Expense(SGA) was $661 Mil.
Total Current Liabilities was $9,499 Mil.
Long-Term Debt was $3,245 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)|
|=||(3793.49046016 / 15155.892592)||/||(4208.7628866 / 5792.59556007)|
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)|
|=||(1722.78338945 / 5792.59556007)||/||(1455.667789 / 15155.892592)|
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 - (14081.9304153 + 748.59708193) / 23042.6487093)||/||(1 - (17658.5051546 + 863.402061856) / 26926.5463918)|
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))|
|=||(204.375638944 / (204.375638944 + 863.402061856))||/||(181.898348565 / (181.898348565 + 748.59708193))|
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)|
|=||(1976.09147866 / 15155.892592)||/||(661.19456094 / 5792.59556007)|
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)|
|=||((3032.54769921 + 6823.79349046) / 23042.6487093)||/||((3244.84536082 + 9498.71134021) / 26926.5463918)|
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|
|=||(1299.07559141 - -57.5771711201||-||335.806195753)||/||23042.6487093|
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.
Nokia Oyj has a M-score of -0.85 signals that the company is likely to 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
Nokia Oyj Annual Data
Nokia Oyj Quarterly Data