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Nokia Oyj (NYSE:NOK)
Beneish M-Score
-1.80 (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 -1.86 signals that the company is a manipulator.

NOK' s 10-Year Beneish M-Score Range
Min: -3.41   Max: -0.62
Current: -1.8

-3.41
-0.62

During the past 13 years, the highest Beneish M-Score of Nokia Oyj was -0.62. The lowest was -3.41. And the median was -2.27.


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 * 1.0798+0.528 * 0.9496+0.404 * 0.7315+0.892 * 0.9842+0.115 * 1.9189
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9799+4.679 * 0.1193-0.327 * 0.9263
=-1.86

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

This Year (Dec14) TTM:Last Year (Dec13) TTM:
Accounts Receivable was $4,229 Mil.
Revenue was 4688.03945746 + 4283.50515464 + 3997.2826087 + 3684.6473029 = $16,653 Mil.
Gross Profit was 2034.52527744 + 1904.63917526 + 1758.15217391 + 1681.88105118 = $7,379 Mil.
Total Current Assets was $16,922 Mil.
Total Assets was $25,972 Mil.
Property, Plant and Equipment(Net PPE) was $883 Mil.
Depreciation, Depletion and Amortization(DDA) was $366 Mil.
Selling, General & Admin. Expense(SGA) was $2,143 Mil.
Total Current Liabilities was $8,986 Mil.
Long-Term Debt was $3,176 Mil.
Net Income was 547.472256473 + 962.628865979 + 3410.32608696 + -330.567081604 = $4,590 Mil.
Non Operating Income was -70.2836004932 + -2.57731958763 + -6.79347826087 + -102.35131397 = $-182 Mil.
Cash Flow from Operations was 276.202219482 + 514.175257732 + 1073.36956522 + -190.871369295 = $1,673 Mil.
Accounts Receivable was $3,979 Mil.
Revenue was 4768.17558299 + 3922.56341789 + 4162.26912929 + 4067.35751295 = $16,920 Mil.
Gross Profit was 2027.43484225 + 1679.57276368 + 1813.98416887 + 1598.44559585 = $7,119 Mil.
Total Current Assets was $18,925 Mil.
Total Assets was $34,556 Mil.
Property, Plant and Equipment(Net PPE) was $776 Mil.
Depreciation, Depletion and Amortization(DDA) was $999 Mil.
Selling, General & Admin. Expense(SGA) was $2,222 Mil.
Total Current Liabilities was $12,963 Mil.
Long-Term Debt was $4,508 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)
=(4229.34648582 / 16653.4745237) / (3979.42386831 / 16920.3656431)
=0.25396181 / 0.23518545
=1.0798

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)
=(1904.63917526 / 16920.3656431) / (2034.52527744 / 16653.4745237)
=0.42076144 / 0.44310259
=0.9496

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 - (16922.3181258 + 882.860665845) / 25971.6399507) / (1 - (18924.5541838 + 776.406035665) / 34555.5555556)
=0.31443764 / 0.42987575
=0.7315

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
=16653.4745237 / 16920.3656431
=0.9842

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))
=(998.628257888 / (998.628257888 + 776.406035665)) / (366.214549938 / (366.214549938 + 882.860665845))
=0.5625966 / 0.29318855
=1.9189

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)
=(2143.3475364 / 16653.4745237) / (2222.39777133 / 16920.3656431)
=0.12870272 / 0.13134455
=0.9799

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)
=((3176.32552404 + 8986.43649815) / 25971.6399507) / ((4507.54458162 + 12962.962963) / 34555.5555556)
=0.46830936 / 0.50557739
=0.9263

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
=(4589.8601278 - -182.005712311 - 1672.87567314) / 25971.6399507
=0.1193

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 -1.86 signals that the company is likely to 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 -0.0283-0.0084-0.01910.0198-0.0668-0.0748-0.0629-0.0844-0.02490.107
M-score -2.47-2.15-1.62-2.26-2.92-2.96-2.85-2.65-2.83-1.90

Nokia Oyj Quarterly Data

Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14
DSRI 1.41644.95023.62432.55566.49630.26880.34750.44720.16791.0798
GMI 1.13170.650.50060.40740.18121.07521.28441.48543.2660.9496
AQI 1.00261.06981.02391.05461.02511.63320.88520.97171.11340.7315
SGI 0.53180.15570.20190.26140.10932.03191.91991.87775.050.9842
DEPI 0.87150.8610.95771.08271.03080.94730.90690.88070.98541.9189
SGAI 1.19311.17690.73310.67450.32660.88831.27551.36662.76970.9799
LVGI 1.13271.05691.03280.96331.06610.80881.09050.82740.68330.9263
TATA -0.1464-0.0912-0.0549-0.044-0.0285-0.0236-0.00750.07610.10140.1193
M-score -3.22-0.25-1.26-2.131.32-1.97-2.28-1.631.88-1.86
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