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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 -2.77. The lowest was -3.46. And the median was -2.92.


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 (Mar16) TTM:Last Year (Mar15) TTM:
Accounts Receivable was USD 43.4 Mil.
Revenue was 80.632 + 84.861 + 73.553 + 72.409 = USD 311.5 Mil.
Gross Profit was 53.742 + 57.902 + 48.458 + 46.128 = USD 206.2 Mil.
Total Current Assets was USD 128.7 Mil.
Total Assets was USD 2,523.6 Mil.
Property, Plant and Equipment(Net PPE) was USD 2,350.3 Mil.
Depreciation, Depletion and Amortization(DDA) was USD 108.3 Mil.
Selling, General & Admin. Expense(SGA) was USD 28.4 Mil.
Total Current Liabilities was USD 1,863.9 Mil.
Long-Term Debt was USD 1,735.9 Mil.
Net Income was -10.082 + -0.719 + -1.302 + -0.688 = USD -12.8 Mil.
Non Operating Income was 0 + 2.031 + -0.067 + 4.04 = USD 6.0 Mil.
Cash Flow from Operations was 14.645 + 14.963 + 20.743 + 22.99 = USD 73.3 Mil.
Accounts Receivable was USD 34.5 Mil.
Revenue was 74.561 + 81.714 + 74.783 + 67.79 = USD 298.8 Mil.
Gross Profit was 46.827 + 53.801 + 46.463 + 41.958 = USD 189.0 Mil.
Total Current Assets was USD 203.4 Mil.
Total Assets was USD 2,227.4 Mil.
Property, Plant and Equipment(Net PPE) was USD 2,023.9 Mil.
Depreciation, Depletion and Amortization(DDA) was USD 114.6 Mil.
Selling, General & Admin. Expense(SGA) was USD 30.0 Mil.
Total Current Liabilities was USD 1,659.0 Mil.
Long-Term Debt was USD 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)
=(43.434 / 311.455) / (34.471 / 298.848)
=0.13945514 / 0.11534626
=

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)
=(57.902 / 298.848) / (53.742 / 311.455)
=0.63259249 / 0.66215023
=

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 - (128.677 + 2350.34) / 2523.557) / (1 - (203.441 + 2023.911) / 2227.352)
=0.01764969 / 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
=311.455 / 298.848
=

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))
=(114.555 / (114.555 + 2023.911)) / (108.303 / (108.303 + 2350.34))
=0.05356877 / 0.04404991
=

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)
=(28.365 / 311.455) / (29.964 / 298.848)
=0.09107255 / 0.10026502
=

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)
=((1735.926 + 1863.918) / 2523.557) / ((0 + 1658.969) / 2227.352)
=1.42649601 / 0.74481672
=

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
=(-12.791 - 6.004 - 73.341) / 2523.557
=-0.0365

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 1.4845
GMI 1.0273
AQI 0
SGI 0.9964
DEPI 0.9127
SGAI 1.5936
LVGI 0.9856
TATA -0.0561
M-score -2.80

Rouse Properties Inc Quarterly Data

Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16
DSRI 1.09791.0887
GMI 0.89631.094
AQI 0.16510
SGI 1.15381.0881
DEPI 1.11281.0306
SGAI 0.99590.9872
LVGI 1.04371.0099
TATA -0.063-0.0481
M-score -2.94-2.90
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