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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 Beneish M-Score Range Over the Past 10 Years
Min: -4.16   Max: 1.06
Current: -2.54

-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 -2.55.


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 * 1.2127+0.528 * 1.0057+0.404 * 1.0039+0.892 * 0.9317+0.115 * 0.847
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0921+4.679 * -0.0328-0.327 * 1.0456
=-2.54

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

This Year (Sep16) TTM:Last Year (Sep15) TTM:
Accounts Receivable was $2,219 Mil.
Revenue was 6184 + 6044 + 5551 + 5775 = $23,554 Mil.
Gross Profit was 3645 + 3510 + 3410 + 3241 = $13,806 Mil.
Total Current Assets was $22,981 Mil.
Total Assets was $52,359 Mil.
Property, Plant and Equipment(Net PPE) was $2,306 Mil.
Depreciation, Depletion and Amortization(DDA) was $1,428 Mil.
Selling, General & Admin. Expense(SGA) was $2,385 Mil.
Total Current Liabilities was $7,311 Mil.
Long-Term Debt was $10,008 Mil.
Net Income was 1599 + 1444 + 1164 + 1498 = $5,705 Mil.
Non Operating Income was -379 + 176 + 127 + 99 = $23 Mil.
Cash Flow from Operations was 2084 + 1840 + 737 + 2739 = $7,400 Mil.
Accounts Receivable was $1,964 Mil.
Revenue was 5456 + 5832 + 6894 + 7099 = $25,281 Mil.
Gross Profit was 3204 + 3381 + 4266 + 4052 = $14,903 Mil.
Total Current Assets was $22,099 Mil.
Total Assets was $50,796 Mil.
Property, Plant and Equipment(Net PPE) was $2,534 Mil.
Depreciation, Depletion and Amortization(DDA) was $1,214 Mil.
Selling, General & Admin. Expense(SGA) was $2,344 Mil.
Total Current Liabilities was $6,100 Mil.
Long-Term Debt was $9,969 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)
=(2219 / 23554) / (1964 / 25281)
=0.09420905 / 0.0776868
=1.2127

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)
=(14903 / 25281) / (13806 / 23554)
=0.58949409 / 0.58614248
=1.0057

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 - (22981 + 2306) / 52359) / (1 - (22099 + 2534) / 50796)
=0.51704578 / 0.51506024
=1.0039

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
=23554 / 25281
=0.9317

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))
=(1214 / (1214 + 2534)) / (1428 / (1428 + 2306))
=0.32390608 / 0.38243171
=0.847

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)
=(2385 / 23554) / (2344 / 25281)
=0.10125669 / 0.09271785
=1.0921

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)
=((10008 + 7311) / 52359) / ((9969 + 6100) / 50796)
=0.33077408 / 0.31634381
=1.0456

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
=(5705 - 23 - 7400) / 52359
=-0.0328

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 local exchange's currency.

Qualcomm Inc Annual Data

Sep07Sep08Sep09Sep10Sep11Sep12Sep13Sep14Sep15Sep16
DSRI 0.86664.49640.18540.98830.99961.14931.12891.05710.85311.2127
GMI 1.01761.0060.99851.02151.0091.07161.03931.01431.0121.0058
AQI 0.97121.01951.04671.15491.031.0530.88520.96591.05681.0039
SGI 1.17871.2560.93481.05521.36081.27841.30051.06520.95450.9317
DEPI 0.8791.01280.82890.95880.71781.27580.94410.80170.97620.847
SGAI 1.12360.92490.96941.00010.87040.93470.83320.85381.07241.0921
LVGI 1.30570.7641.09891.7450.81190.84890.92911.08082.55551.0456
TATA -0.0381-0.001-0.1799-0.0362-0.0251-0.0058-0.0487-0.0442-0.0103-0.0328
M-score -2.761.06-4.16-2.79-2.21-1.97-2.30-2.61-3.20-2.54

Qualcomm Inc Quarterly Data

Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16
DSRI 0.94631.05711.59380.86820.93240.85310.66511.02661.14871.2127
GMI 1.03411.01421.00841.00331.00921.0121.00491.01421.00691.0057
AQI 0.81270.96590.95610.99880.94051.05681.14161.08431.18871.0039
SGI 1.12991.06521.05871.06911.00920.95450.88850.82260.86080.9317
DEPI 0.82320.80170.9210.93320.97030.97620.92170.87930.83570.847
SGAI 0.83590.85340.82590.86110.9221.07291.1871.31881.28551.0921
LVGI 1.15921.08081.15171.0612.45652.55552.47762.59971.08581.0456
TATA -0.0576-0.0349-0.02410.0110.0046-0.0089-0.0258-0.0542-0.0451-0.0328
M-score -2.78-2.56-2.04-2.49-3.00-3.19-3.47-3.42-2.69-2.54
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