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Nokia Oyj (NYSE:NOK)
Beneish M-Score
-0.55 (As of Today)

Warning Sign:

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.

Nokia Oyj has a M-score of -0.85 signals that the company is a manipulator.

NOK' s Beneish M-Score Range Over the Past 10 Years
Min: -4.55   Max: 316315.23
Current: -0.55

-4.55
316315.23

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.


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 * 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
=-0.85

* 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 + 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

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 / 15155.892592) / (4208.7628866 / 5792.59556007)
=0.25029806 / 0.72657634
=0.3445

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 / 5792.59556007) / (1455.667789 / 15155.892592)
=0.87625847 / 0.44085765
=1.9876

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
=15155.892592 / 5792.59556007
=2.6164

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))
=0.1914028 / 0.19548548
=0.9791

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)
=0.13038437 / 0.11414478
=1.1423

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
=(1299.07559141 - -57.5771711201 - 335.806195753) / 23042.6487093
=0.0443

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.


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

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
DSRI 0.91581.53430.84771.04560.91581.04150.99031.24091.18021.1621
GMI 1.07710.96150.98771.05861.07181.03131.05310.66110.94971.015
AQI 1.25891.58311.93480.87250.89760.95741.03411.68510.73150.6698
SGI 1.34031.36820.92210.87180.93980.9060.77850.44020.90050.8673
DEPI 1.00730.79650.88590.89271.01231.04480.96060.85491.91890.93
SGAI 0.9271.12181.02871.10930.94921.08041.0860.95280.97611.0299
LVGI 1.04791.12781.05081.02421.01411.06231.1140.76730.92630.8586
TATA -0.009-0.01910.0198-0.0668-0.0748-0.0629-0.0919-0.02490.1070.0955
M-score -2.15-1.62-2.26-2.92-2.96-2.85-3.13-2.71-1.90-2.09

Nokia Oyj Quarterly Data

Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15
DSRI 1.17042.49713.23043.39263.69980.54530.51970.54480.34451.1656
GMI 0.83490.52260.4890.50490.37091.20271.33471.38041.98760.9864
AQI 1.03481.68511.89862.14621.12270.73151.39241.27021.14180.6698
SGI 0.60640.21880.2650.33540.22921.9491.88611.76792.61640.8646
DEPI 1.17640.72151.6861.40630.7281.3021.15991.22480.97910.9704
SGAI 0.92840.90570.93730.98160.88781.031.00591.02071.14231.043
LVGI 1.08790.76730.67530.72060.66250.92630.960.88010.90380.8586
TATA -0.0388-0.026-0.01770.07250.09770.11540.14790.08020.04430.0958
M-score -2.93-1.84-0.88-0.19-0.41-1.46-1.07-1.47-0.85-2.11
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