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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 64.29. The lowest was -4.76. And the median was -2.33.
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 * 0.9951||+||0.528 * 0.9944||+||0.404 * 0.8428||+||0.892 * 1.0102||+||0.115 * 0.8917|
|-||0.172 * SGAI||+||4.679 * TATA||-||0.327 * LVGI|
|-||0.172 * 1.0051||+||4.679 * -0.0074||-||0.327 * 0.9688|
|This Year (Jun14) TTM:||Last Year (Jun13) TTM:|
|Accounts Receivable was $1,326 Mil.|
Revenue was 1417.897 + 1214.53 + 1395.158 + 1151.02 = $5,179 Mil.
Gross Profit was 194.599 + 163.745 + 181.155 + 168.668 = $708 Mil.
Total Current Assets was $1,731 Mil.
Total Assets was $1,977 Mil.
Property, Plant and Equipment(Net PPE) was $117 Mil.
Depreciation, Depletion and Amortization(DDA) was $41 Mil.
Selling, General & Admin. Expense(SGA) was $571 Mil.
Total Current Liabilities was $1,192 Mil.
Long-Term Debt was $27 Mil.
Net Income was 27.249 + 11.55 + 20.407 + 15.025 = $74 Mil.
Non Operating Income was -0.904 + -0.745 + -0.777 + -0.838 = $-3 Mil.
Cash Flow from Operations was 37.682 + 66.033 + 9.49 + -21.174 = $92 Mil.
|Accounts Receivable was $1,319 Mil.
Revenue was 1416.547 + 1181.622 + 1346.675 + 1181.409 = $5,126 Mil.
Gross Profit was 190.927 + 158.137 + 180.393 + 167.625 = $697 Mil.
Total Current Assets was $1,679 Mil.
Total Assets was $1,967 Mil.
Property, Plant and Equipment(Net PPE) was $137 Mil.
Depreciation, Depletion and Amortization(DDA) was $42 Mil.
Selling, General & Admin. Expense(SGA) was $562 Mil.
Total Current Liabilities was $1,199 Mil.
Long-Term Debt was $53 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)|
|=||(1325.866 / 5178.605)||/||(1318.967 / 5126.253)|
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)|
|=||(163.745 / 5126.253)||/||(194.599 / 5178.605)|
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 - (1731.243 + 117.386) / 1976.575)||/||(1 - (1679.143 + 136.992) / 1967.235)|
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))|
|=||(41.55 / (41.55 + 136.992))||/||(41.455 / (41.455 + 117.386))|
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)|
|=||(571.003 / 5178.605)||/||(562.357 / 5126.253)|
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)|
|=||((27.191 + 1191.879) / 1976.575)||/||((53 + 1199.389) / 1967.235)|
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|
|=||(74.231 - -3.264||-||92.031)||/||1976.575|
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