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Qualcomm Inc (NAS:QCOM)
Beneish M-Score
-3.42 (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 -3.42 suggests that the company is not a manipulator.

QCOM' s Beneish M-Score Range Over the Past 10 Years
Min: -4.16   Max: 1.06
Current: -3.42

-4.16
1.06

During the past 13 years, the highest Beneish M-Score of Qualcomm Inc was 1.06. The lowest was -4.16. And the median was -2.60.


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 * 1.0266+0.528 * 1.0142+0.404 * 1.0843+0.892 * 0.8226+0.115 * 0.8793
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.3188+4.679 * -0.0542-0.327 * 2.5997
=-3.42

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

This Year (Mar16) TTM:Last Year (Mar15) TTM:
Accounts Receivable was $1,738 Mil.
Revenue was 5551 + 5775 + 5456 + 5832 = $22,614 Mil.
Gross Profit was 3410 + 3241 + 3204 + 3381 = $13,236 Mil.
Total Current Assets was $20,157 Mil.
Total Assets was $50,060 Mil.
Property, Plant and Equipment(Net PPE) was $2,391 Mil.
Depreciation, Depletion and Amortization(DDA) was $1,359 Mil.
Selling, General & Admin. Expense(SGA) was $2,429 Mil.
Total Current Liabilities was $7,026 Mil.
Long-Term Debt was $9,993 Mil.
Net Income was 1164 + 1498 + 1062 + 1184 = $4,908 Mil.
Non Operating Income was 127 + 99 + 54 + 67 = $347 Mil.
Cash Flow from Operations was 737 + 2739 + 1684 + 2116 = $7,276 Mil.
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.



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)
=(1738 / 22614) / (2058 / 27491)
=0.07685505 / 0.07486086
=1.0266

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)
=(16319 / 27491) / (13236 / 22614)
=0.59361245 / 0.58530114
=1.0142

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 - (20157 + 2391) / 50060) / (1 - (20740 + 2523) / 47173)
=0.5495805 / 0.50685774
=1.0843

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
=22614 / 27491
=0.8226

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))
=(1180 / (1180 + 2523)) / (1359 / (1359 + 2391))
=0.31866055 / 0.3624
=0.8793

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)
=(2429 / 22614) / (2239 / 27491)
=0.10741134 / 0.08144484
=1.3188

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)
=((9993 + 7026) / 50060) / ((0 + 6169) / 47173)
=0.33997203 / 0.13077396
=2.5997

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
=(4908 - 347 - 7276) / 50060
=-0.0542

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 -3.42 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

Sep06Sep07Sep08Sep09Sep10Sep11Sep12Sep13Sep14Sep15
DSRI 0.96990.86664.49640.18540.98830.99961.14931.12891.05710.8531
GMI 0.99991.01761.0060.99851.02151.0091.07161.03931.01431.012
AQI 1.49450.97121.01951.04671.15491.031.0530.88520.96591.0568
SGI 1.32661.17871.2560.93481.05521.36081.27841.30051.06520.9545
DEPI 1.05540.8791.01280.82890.95880.71781.27580.94410.80170.9762
SGAI 1.33321.12360.92490.96941.00010.87040.93470.83320.85381.0724
LVGI 1.09051.30570.7641.09891.7450.81190.84890.92911.08082.5555
TATA -0.055-0.0381-0.001-0.1799-0.0362-0.0251-0.0058-0.0487-0.0442-0.0103
M-score -2.35-2.761.06-4.16-2.79-2.21-1.97-2.30-2.61-3.20

Qualcomm Inc Quarterly Data

Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16
DSRI 0.64710.98760.94631.05711.59380.86820.93240.85310.66511.0266
GMI 1.05611.04521.03411.01421.00841.00331.00921.0121.00491.0142
AQI 0.90150.89920.81270.96590.95610.99880.94051.05681.14161.0843
SGI 1.24511.18831.12991.06521.05871.06911.00920.95450.88850.8226
DEPI 0.84210.82570.82320.80170.9210.93320.97030.97620.92170.8793
SGAI 0.85220.82760.83590.85340.82590.86110.9221.07291.1871.3188
LVGI 1.02851.11481.15921.08081.15171.0612.45652.55552.47762.5997
TATA -0.0666-0.0547-0.0576-0.0349-0.02410.0110.0046-0.0089-0.0258-0.0542
M-score -2.91-2.62-2.78-2.56-2.04-2.49-3.00-3.19-3.47-3.42
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