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Resource America Inc (NAS:REXI)
Beneish M-Score
-2.76 (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.

Resource America Inc has a M-score of -2.76 suggests that the company is not a manipulator.

REXI' s Beneish M-Score Range Over the Past 10 Years
Min: -4.37   Max: 3.84
Current: -2.76

-4.37
3.84

During the past 13 years, the highest Beneish M-Score of Resource America Inc was 3.84. The lowest was -4.37. And the median was -2.16.


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 Resource America 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 * 0.9934+0.528 * 1.2502+0.404 * 1.2012+0.892 * 0.7817+0.115 * 1.1025
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.5587+4.679 * -0.0368-0.327 * 1.1066
=-2.76

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

This Year (Sep15) TTM:Last Year (Sep14) TTM:
Accounts Receivable was $26.2 Mil.
Revenue was 40.677 + 45.996 + 42.189 + 17.104 = $146.0 Mil.
Gross Profit was 25.651 + 30.302 + 27.121 + 1.585 = $84.7 Mil.
Total Current Assets was $174.0 Mil.
Total Assets was $2,944.0 Mil.
Property, Plant and Equipment(Net PPE) was $5.5 Mil.
Depreciation, Depletion and Amortization(DDA) was $2.0 Mil.
Selling, General & Admin. Expense(SGA) was $14.3 Mil.
Total Current Liabilities was $24.8 Mil.
Long-Term Debt was $1,902.1 Mil.
Net Income was -1.1 + -1.652 + 0.337 + 1.744 = $-0.7 Mil.
Non Operating Income was 5.012 + 6.426 + 16.363 + 26.271 = $54.1 Mil.
Cash Flow from Operations was 34.938 + 113.37 + -125.861 + 31.052 = $53.5 Mil.
Accounts Receivable was $33.7 Mil.
Revenue was 50.409 + 53.115 + 49.302 + 33.911 = $186.7 Mil.
Gross Profit was 38.088 + 41.108 + 35.935 + 20.272 = $135.4 Mil.
Total Current Assets was $597.9 Mil.
Total Assets was $2,763.1 Mil.
Property, Plant and Equipment(Net PPE) was $5.2 Mil.
Depreciation, Depletion and Amortization(DDA) was $2.1 Mil.
Selling, General & Admin. Expense(SGA) was $11.8 Mil.
Total Current Liabilities was $22.7 Mil.
Long-Term Debt was $1,611.7 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)
=(26.158 / 145.966) / (33.688 / 186.737)
=0.17920612 / 0.18040346
=0.9934

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)
=(30.302 / 186.737) / (25.651 / 145.966)
=0.72510001 / 0.57999123
=1.2502

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 - (174.046 + 5.533) / 2943.994) / (1 - (597.898 + 5.177) / 2763.102)
=0.93900157 / 0.78173987
=1.2012

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
=145.966 / 186.737
=0.7817

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))
=(2.147 / (2.147 + 5.177)) / (2.004 / (2.004 + 5.533))
=0.29314582 / 0.26588828
=1.1025

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)
=(14.34 / 145.966) / (11.77 / 186.737)
=0.09824206 / 0.06302982
=1.5587

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)
=((1902.136 + 24.846) / 2943.994) / ((1611.692 + 22.722) / 2763.102)
=0.65454685 / 0.59151418
=1.1066

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
=(-0.671 - 54.072 - 53.499) / 2943.994
=-0.0368

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.

Resource America Inc has a M-score of -2.76 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.

Resource America Inc Annual Data

Sep06Sep07Sep08Sep09Sep10Sep11Sep12Dec13Dec14Dec15
DSRI 0.65032.21790.73952.15781.47140.86051.04840.29560.89311.638
GMI 0.82410.86181.42491.07721.15461.08131.26510.35390.97641.856
AQI 1.37170.88331.45050.83980.76971.30580.88751.26931.08810.7865
SGI 1.59971.68191.23010.69360.82040.96940.74912.38611.1010.5899
DEPI 0.2741.08160.88010.66090.72640.82331.0382.39090.96861.0056
SGAI 0.72960.7231.10081.28841.10050.91621.21190.41140.98342.413
LVGI 0.90691.62341.01750.77140.71931.40140.40912.29781.03150.398
TATA 0.1298-0.0853-0.09750.1107-0.1787-0.0436-0.17050.0344-0.0507-0.1094
M-score -1.61-1.42-2.60-1.21-3.01-2.81-3.20-2.13-2.71-2.45

Resource America Inc Quarterly Data

Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15
DSRI 0.35850.32130.65180.70180.7270.88970.76910.88290.99341.6443
GMI 0.35930.44470.77290.86820.90960.97471.0161.12241.25021.8592
AQI 1.35761.16770.94990.98670.87571.08811.04421.05831.20120.7865
SGI 2.10352.50091.77421.63461.37771.10531.01940.86810.78170.5876
DEPI 2.21911.771.67881.62420.98510.96861.12281.10431.10251.0056
SGAI 0.41190.41810.66820.79760.94260.97970.98031.23591.55872.4222
LVGI 2.3522.34910.9220.9530.98091.03151.02921.07041.10660.398
TATA -0.01190.03440.005-0.0020.0068-0.05070.024-0.0377-0.0368-0.1094
M-score -2.54-2.08-2.07-2.15-2.45-2.71-2.53-2.85-2.76-2.45
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