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GuruFocus has detected 5 Warning Signs with Insight Enterprises Inc $NSIT.
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Insight Enterprises Inc (NAS:NSIT)
Beneish M-Score
-2.51 (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.

Insight Enterprises Inc has a M-score of -2.51 suggests that the company is not a manipulator.

NSIT' s Beneish M-Score Range Over the Past 10 Years
Min: -3.91   Max: 64.29
Current: -2.51

-3.91
64.29

During the past 13 years, the highest Beneish M-Score of Insight Enterprises Inc was 64.29. The lowest was -3.91. And the median was -2.50.


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 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 * 1.0701+0.528 * 0.9841+0.404 * 0.8591+0.892 * 1.0209+0.115 * 0.8598
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9801+4.679 * -0.0042-0.327 * 1.0347
=-2.51

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

This Year (Dec16) TTM:Last Year (Dec15) TTM:
Accounts Receivable was $1,437 Mil.
Revenue was 1467.583 + 1392.716 + 1456.234 + 1168.982 = $5,486 Mil.
Gross Profit was 190.969 + 181.808 + 209.217 + 161.108 = $743 Mil.
Total Current Assets was $1,984 Mil.
Total Assets was $2,219 Mil.
Property, Plant and Equipment(Net PPE) was $71 Mil.
Depreciation, Depletion and Amortization(DDA) was $38 Mil.
Selling, General & Admin. Expense(SGA) was $585 Mil.
Total Current Liabilities was $1,439 Mil.
Long-Term Debt was $40 Mil.
Net Income was 21.1 + 21.635 + 35.067 + 6.888 = $85 Mil.
Non Operating Income was 0.209 + -0.931 + -0.206 + -0.884 = $-2 Mil.
Cash Flow from Operations was 220.948 + -120.235 + 42.279 + -47.187 = $96 Mil.
Accounts Receivable was $1,315 Mil.
Revenue was 1387.185 + 1342.195 + 1424.031 + 1219.679 = $5,373 Mil.
Gross Profit was 180.853 + 182.251 + 191.415 + 161.813 = $716 Mil.
Total Current Assets was $1,752 Mil.
Total Assets was $2,014 Mil.
Property, Plant and Equipment(Net PPE) was $88 Mil.
Depreciation, Depletion and Amortization(DDA) was $38 Mil.
Selling, General & Admin. Expense(SGA) was $585 Mil.
Total Current Liabilities was $1,208 Mil.
Long-Term Debt was $89 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)
=(1436.742 / 5485.515) / (1315.094 / 5373.09)
=0.26191561 / 0.24475562
=1.0701

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)
=(716.332 / 5373.09) / (743.102 / 5485.515)
=0.13331844 / 0.13546622
=0.9841

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 - (1983.605 + 70.91) / 2219.3) / (1 - (1751.659 + 88.281) / 2014.017)
=0.07425089 / 0.08643274
=0.8591

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
=5485.515 / 5373.09
=1.0209

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))
=(37.957 / (37.957 + 88.281)) / (38.13 / (38.13 + 70.91))
=0.30067808 / 0.34968819
=0.8598

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)
=(585.243 / 5485.515) / (584.906 / 5373.09)
=0.1066888 / 0.1088584
=0.9801

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)
=((40.251 + 1438.662) / 2219.3) / ((89 + 1208.125) / 2014.017)
=0.66638715 / 0.64404868
=1.0347

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
=(84.69 - -1.812 - 95.805) / 2219.3
=-0.0042

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 -2.51 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 local exchange's currency.

Insight Enterprises Inc Annual Data

Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15Dec16
DSRI 0.8070.92351.170.97820.96761.13190.94531.00710.99391.0701
GMI 0.95111.00141.00051.02331.00150.9880.99921.01381.00520.9841
AQI 0.94220.58320.96750.79371.02170.80120.96060.95161.20970.8591
SGI 1.3361.00520.85731.16271.09921.00270.97041.03341.01071.0209
DEPI 0.82850.86160.9651.01580.97360.97610.93570.85010.93210.8598
SGAI 1.07881.05011.04220.88910.97571.01261.030.98831.0030.9801
LVGI 0.95521.28920.96180.98260.96730.95640.94991.02981.04411.0347
TATA -0.0128-0.2306-0.0551-0.0115-0.00810.0121-0.0018-0.0169-0.0515-0.0042
M-score -2.49-3.91-2.72-2.45-2.44-2.38-2.58-2.56-2.65-2.51

Insight Enterprises Inc Quarterly Data

Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16Dec16
DSRI 1.01121.00710.94111.06991.03380.99391.01091.00651.0561.0701
GMI 1.01411.01381.01921.031.02251.00520.9930.96930.97430.9841
AQI 0.86020.95160.97090.87130.91521.20971.36181.35911.28040.8591
SGI 1.03321.03341.02781.02881.03171.01071.00021.00510.9951.0209
DEPI 0.87830.85010.84380.90930.92080.93210.93060.87490.85730.8598
SGAI 0.98170.98830.98830.97980.98111.0031.02571.02411.01720.9801
LVGI 0.99751.02981.00521.10111.09711.04410.99670.99181.0381.0347
TATA 0.0135-0.01690.0069-0.0132-0.0064-0.0515-0.02280.00130.0283-0.0042
M-score -2.44-2.56-2.50-2.53-2.51-2.65-2.45-2.35-2.23-2.51
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