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Rouse Properties Inc (NYSE:RSE)
Beneish M-Score
0.00 (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.

Rouse Properties Inc has a M-score of signals that the company is a manipulator.

During the past 7 years, the highest Beneish M-Score of Rouse Properties Inc was -2.69. The lowest was -2.69. And the median was -2.69.


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 Rouse Properties 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 * +0.528 * +0.404 * +0.892 * +0.115 *
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * +4.679 * -0.327 *
=

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

This Year (Dec15) TTM:Last Year (Dec14) TTM:
Accounts Receivable was $43.2 Mil.
Revenue was 84.861 + 73.553 + 72.409 + 74.561 = $305.4 Mil.
Gross Profit was 57.902 + 48.458 + 46.128 + 46.827 = $199.3 Mil.
Total Current Assets was $188.7 Mil.
Total Assets was $2,529.3 Mil.
Property, Plant and Equipment(Net PPE) was $2,340.5 Mil.
Depreciation, Depletion and Amortization(DDA) was $107.9 Mil.
Selling, General & Admin. Expense(SGA) was $28.0 Mil.
Total Current Liabilities was $1,853.8 Mil.
Long-Term Debt was $0.0 Mil.
Net Income was -0.719 + -1.302 + -0.688 + 44.401 = $41.7 Mil.
Non Operating Income was 2.031 + -0.067 + 4.04 + 55.349 = $61.4 Mil.
Cash Flow from Operations was 14.963 + 20.743 + 22.99 + 18.487 = $77.2 Mil.
Accounts Receivable was $35.5 Mil.
Revenue was 81.714 + 74.783 + 67.79 + 67.839 = $292.1 Mil.
Gross Profit was 53.801 + 46.463 + 41.958 + 41.734 = $184.0 Mil.
Total Current Assets was $268.8 Mil.
Total Assets was $2,270.4 Mil.
Property, Plant and Equipment(Net PPE) was $2,001.6 Mil.
Depreciation, Depletion and Amortization(DDA) was $100.3 Mil.
Selling, General & Admin. Expense(SGA) was $29.6 Mil.
Total Current Liabilities was $1,737.1 Mil.
Long-Term Debt was $0.0 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)
=(43.196 / 305.384) / (35.492 / 292.126)
=0.14144814 / 0.12149552
=

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)
=(48.458 / 292.126) / (57.902 / 305.384)
=0.62971458 / 0.65267008
=

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 - (188.749 + 2340.509) / 2529.258) / (1 - (268.803 + 2001.597) / 2270.4)
=0 / 0
=

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
=305.384 / 292.126
=

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))
=(100.302 / (100.302 + 2001.597)) / (107.941 / (107.941 + 2340.509))
=0.0477197 / 0.04408544
=

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)
=(27.964 / 305.384) / (29.587 / 292.126)
=0.09156996 / 0.10128164
=

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 + 1853.801) / 2529.258) / ((0 + 1737.065) / 2270.4)
=0.73294263 / 0.76509205
=

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
=(41.692 - 61.353 - 77.183) / 2529.258
=-0.0383

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.

Rouse Properties Inc has a M-score of signals that the company is likely to 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.

Rouse Properties Inc Annual Data

Dec09Dec10Dec11Dec12Dec13Dec14Dec15
DSRI 1.473
GMI 1.2033
AQI 0
SGI 1.0042
DEPI 1.1864
SGAI 1.5886
LVGI 0.9856
TATA -0.0561
M-score -2.68

Rouse Properties Inc Quarterly Data

Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15
DSRI 1.07641.0887
GMI 0.95120.9708
AQI 0.16510
SGI 1.17691.0881
DEPI 1.47930.7989
SGAI 0.97990.9872
LVGI 1.04371.0099
TATA -0.063-0.0481
M-score -2.87-2.99
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