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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.
Insight Enterprises, Inc. has a M-score of -2.58 suggests that the company is not a manipulator.
During the past 13 years, the highest Beneish M-Score of Insight Enterprises, Inc. was 64.28. The lowest was -3.91. And the median was -2.45.
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 Insight Enterprises, 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 * 0.9453||+||0.528 * 0.9992||+||0.404 * 0.9606||+||0.892 * 0.9704||+||0.115 * 0.9357|
|-||0.172 * SGAI||+||4.679 * TATA||-||0.327 * LVGI|
|-||0.172 * 1.03||+||4.679 * -0.0018||-||0.327 * 0.9499|
|This Year (Dec13) TTM:||Last Year (Dec12) TTM:|
|Accounts Receivable was $1,258 Mil.|
Revenue was 1395.158 + 1151.02 + 1416.547 + 1181.622 = $5,144 Mil.
Gross Profit was 181.155 + 168.668 + 190.927 + 158.137 = $699 Mil.
Total Current Assets was $1,595 Mil.
Total Assets was $1,868 Mil.
Property, Plant and Equipment(Net PPE) was $133 Mil.
Depreciation, Depletion and Amortization(DDA) was $42 Mil.
Selling, General & Admin. Expense(SGA) was $565 Mil.
Total Current Liabilities was $1,052 Mil.
Long-Term Debt was $67 Mil.
Net Income was 20.407 + 15.025 + 26.513 + 9.076 = $71 Mil.
Non Operating Income was -0.777 + -0.838 + 0.544 + -0.535 = $-2 Mil.
Cash Flow from Operations was 9.49 + -21.174 + 71.467 + 16.283 = $76 Mil.
|Accounts Receivable was $1,371 Mil.
Revenue was 1346.675 + 1181.409 + 1529.175 + 1244.182 = $5,301 Mil.
Gross Profit was 180.393 + 167.625 + 201.286 + 170.372 = $720 Mil.
Total Current Assets was $1,702 Mil.
Total Assets was $2,002 Mil.
Property, Plant and Equipment(Net PPE) was $144 Mil.
Depreciation, Depletion and Amortization(DDA) was $41 Mil.
Selling, General & Admin. Expense(SGA) was $565 Mil.
Total Current Liabilities was $1,182 Mil.
Long-Term Debt was $80 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)|
|=||(1257.91 / 5144.347)||/||(1371.356 / 5301.441)|
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)|
|=||(168.668 / 5301.441)||/||(181.155 / 5144.347)|
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 - (1594.664 + 132.82) / 1867.718)||/||(1 - (1701.55 + 143.513) / 2001.503)|
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))|
|=||(41.177 / (41.177 + 143.513))||/||(41.544 / (41.544 + 132.82))|
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)|
|=||(564.91 / 5144.347)||/||(565.206 / 5301.441)|
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)|
|=||((66.949 + 1051.805) / 1867.718)||/||((80 + 1182.121) / 2001.503)|
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|
|=||(71.021 - -1.606||-||76.066)||/||1867.718|
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.
Insight Enterprises, Inc. has a M-score of -2.58 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
Insight Enterprises, Inc. Annual Data
Insight Enterprises, Inc. Quarterly Data