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Nokia Oyj (NYSE:NOK)
Beneish M-Score
-2.35 (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.

Nokia Oyj has a M-score of -2.47 suggests that the company is not a manipulator.

NOK' s Beneish M-Score Range Over the Past 10 Years
Min: -4.57   Max: 316312.67
Current: -2.35

-4.57
316312.67

During the past 13 years, the highest Beneish M-Score of Nokia Oyj was 316312.67. The lowest was -4.57. And the median was -2.42.


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 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 * 1.0041+0.528 * 0.9875+0.404 * 1.1418+0.892 * 0.8977+0.115 * 0.4528
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.035+4.679 * 0.0175-0.327 * 0.9038
=-2.47

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

This Year (Sep15) TTM:Last Year (Sep14) TTM:
Accounts Receivable was $3,793 Mil.
Revenue was 3407.40740741 + 3601.57126824 + 3458.87445887 + 0 = $10,468 Mil.
Gross Profit was 1455.667789 + 1722.78338945 + 1468.61471861 + 0 = $4,647 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 $548 Mil.
Selling, General & Admin. Expense(SGA) was $1,409 Mil.
Total Current Liabilities was $6,824 Mil.
Long-Term Debt was $3,033 Mil.
Net Income was 170.594837262 + 389.450056117 + 191.558441558 + 0 = $752 Mil.
Non Operating Income was -2.24466891134 + -5.61167227834 + 20.5627705628 + 0 = $13 Mil.
Cash Flow from Operations was 564.534231201 + -289.562289562 + -215.367965368 + 276.202219482 = $336 Mil.
Accounts Receivable was $4,209 Mil.
Revenue was 3979.3814433 + 3997.2826087 + 3684.6473029 + 0 = $11,661 Mil.
Gross Profit was 1676.54639175 + 1758.15217391 + 1677.73167358 + 0 = $5,112 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 $1,516 Mil.
Total Current Liabilities was $9,499 Mil.
Long-Term Debt was $3,245 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)
=(3793.49046016 / 10467.8531345) / (4208.7628866 / 11661.3113549)
=0.36239431 / 0.36091678
=1.0041

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)
=(1722.78338945 / 11661.3113549) / (1455.667789 / 10467.8531345)
=0.43840955 / 0.44393686
=0.9875

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 - (14081.9304153 + 748.59708193) / 23042.6487093) / (1 - (17658.5051546 + 863.402061856) / 26926.5463918)
=0.3563879 / 0.31213209
=1.1418

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
=10467.8531345 / 11661.3113549
=0.8977

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)) / (548.112898503 / (548.112898503 + 748.59708193))
=0.1914028 / 0.42269506
=0.4528

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)
=(1408.89049222 / 10467.8531345) / (1516.49033517 / 11661.3113549)
=0.13459211 / 0.13004458
=1.035

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)
=0.42774341 / 0.47327112
=0.9038

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
=(751.603334937 - 12.7064293731 - 335.806195753) / 23042.6487093
=0.0175

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 -2.47 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.

Nokia Oyj Annual Data

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 1.0480.91581.53430.84771.04560.91581.04151.94050.63331.1802
GMI 1.08741.07710.96150.98771.05861.07181.02770.8140.85830.9497
AQI 1.18921.25891.58311.93480.87650.89030.95851.06981.63320.7315
SGI 1.03011.34031.36820.92210.87180.93980.9060.39730.86260.9005
DEPI 1.16571.00730.79650.88590.88121.03591.04140.95410.85491.9189
SGAI 0.96580.9271.12181.02871.10930.94921.06761.06640.9820.9761
LVGI 1.22481.04791.12781.05081.02421.01411.06231.05690.80880.9263
TATA -0.0283-0.0084-0.01910.0198-0.0668-0.0748-0.0629-0.0844-0.02490.1044
M-score -2.47-2.15-1.62-2.26-2.92-2.96-2.85-2.65-2.83-1.92

Nokia Oyj Quarterly Data

Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15
DSRI 0.76821.00250.98941.27040.88381.10751.00891.01251.0041
GMI 0.72640.56880.67070.77240.95580.95581.02470.99970.9875
AQI 1.05461.02511.71230.97171.11340.73150.71991.27021.1418
SGI 0.86970.70790.67440.66090.95960.95960.97160.95130.8977
DEPI 0.32240.31024.08532.37282.76100.32040.54640.4528
SGAI 0.85150.85130.98861.01780.9680.9680.93920.96581.035
LVGI 0.96331.06610.77910.82740.68330.92630.95990.88010.9038
TATA -0.0593-0.0439-0.01220.07080.0960.09160.1220.05370.0175
M-score -3.25-3.24-2.29-2.12-1.84-2.21-2.08-2.16-2.47
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