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Qualcomm Inc (NAS:QCOM)
Beneish M-Score
-2.54 (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.

Qualcomm Inc has a M-score of -2.54 suggests that the company is not a manipulator.

QCOM' s 10-Year Beneish M-Score Range
Min: -4.24   Max: 1.06
Current: -2.54

-4.24
1.06

During the past 13 years, the highest Beneish M-Score of Qualcomm Inc was 1.06. The lowest was -4.24. And the median was -2.56.


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 Qualcomm 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 * 0.8682+0.528 * 1.0033+0.404 * 0.9988+0.892 * 1.0691+0.115 * 0.9332
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.8611+4.679 * 0.0014-0.327 * 1.061
=-2.54

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

This Year (Mar15) TTM:Last Year (Mar14) TTM:
Accounts Receivable was $2,058 Mil.
Revenue was 6894 + 7099 + 6692 + 6806 = $27,491 Mil.
Gross Profit was 4266 + 4052 + 3935 + 4066 = $16,319 Mil.
Total Current Assets was $20,740 Mil.
Total Assets was $47,173 Mil.
Property, Plant and Equipment(Net PPE) was $2,523 Mil.
Depreciation, Depletion and Amortization(DDA) was $1,180 Mil.
Selling, General & Admin. Expense(SGA) was $2,239 Mil.
Total Current Liabilities was $6,169 Mil.
Long-Term Debt was $0 Mil.
Net Income was 1053 + 1972 + 1894 + 2238 = $7,157 Mil.
Non Operating Income was -6 + 101 + 716 + 283 = $1,094 Mil.
Cash Flow from Operations was -658 + 2364 + 1619 + 2673 = $5,998 Mil.
Accounts Receivable was $2,217 Mil.
Revenue was 6367 + 6622 + 6481 + 6243 = $25,713 Mil.
Gross Profit was 3885 + 3916 + 3767 + 3746 = $15,314 Mil.
Total Current Assets was $21,008 Mil.
Total Assets was $47,875 Mil.
Property, Plant and Equipment(Net PPE) was $2,573 Mil.
Depreciation, Depletion and Amortization(DDA) was $1,089 Mil.
Selling, General & Admin. Expense(SGA) was $2,432 Mil.
Total Current Liabilities was $5,901 Mil.
Long-Term Debt was $0 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)
=(2058 / 27491) / (2217 / 25713)
=0.07486086 / 0.08622098
=0.8682

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)
=(4052 / 25713) / (4266 / 27491)
=0.59557422 / 0.59361245
=1.0033

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 - (20740 + 2523) / 47173) / (1 - (21008 + 2573) / 47875)
=0.50685774 / 0.50744648
=0.9988

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
=27491 / 25713
=1.0691

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))
=(1089 / (1089 + 2573)) / (1180 / (1180 + 2523))
=0.29737848 / 0.31866055
=0.9332

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)
=(2239 / 27491) / (2432 / 25713)
=0.08144484 / 0.09458251
=0.8611

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)
=((0 + 6169) / 47173) / ((0 + 5901) / 47875)
=0.13077396 / 0.12325849
=1.061

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
=(7157 - 1094 - 5998) / 47173
=0.0014

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.

Qualcomm Inc has a M-score of -2.54 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 own currency.

Qualcomm Inc Annual Data

Sep05Sep06Sep07Sep08Sep09Sep10Sep11Sep12Sep13Sep14
DSRI 0.80540.96990.86664.49640.18540.98910.99881.14931.12891.0571
GMI 0.98010.99991.01761.0060.99850.99311.03781.07161.03931.0143
AQI 1.08931.49450.97121.01951.04671.15491.031.0530.88520.9659
SGI 1.16251.32661.17871.2560.93481.05431.3621.27841.30051.0652
DEPI 1.18851.05540.8791.01280.82890.95880.71781.27580.94410.8017
SGAI 0.99231.33321.12360.92490.96940.91620.95020.91290.8530.8538
LVGI 1.03781.09051.30570.7641.09891.7450.81190.84890.92911.0808
TATA -0.0571-0.055-0.0381-0.001-0.1799-0.0362-0.0251-0.0058-0.0635-0.0442
M-score -2.75-2.35-2.761.06-4.16-2.79-2.21-1.97-2.37-2.61

Qualcomm Inc Quarterly Data

Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15
DSRI 1.26721.27491.23151.12890.64710.98760.94631.05711.59380.8682
GMI 1.04371.02251.02771.03921.05611.04521.03411.01421.00841.0033
AQI 0.99461.12091.090.88520.90150.89920.81270.96590.95610.9988
SGI 1.25571.24611.26611.30051.24511.18831.12991.06521.05871.0691
DEPI 1.18870.95460.92820.94410.84210.82570.82320.80170.9210.9332
SGAI 0.9190.92220.90390.85330.87180.8460.85410.85340.82590.8611
LVGI 0.84050.88680.82650.92911.02851.11481.15921.08081.15171.061
TATA 0.001-0.0132-0.0301-0.0635-0.0812-0.0663-0.069-0.0418-0.03110.0014
M-score -1.89-1.96-2.05-2.37-2.98-2.68-2.84-2.60-2.07-2.54
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