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Revett Mining Company Inc (AMEX:RVM)
Beneish M-Score
2161.09 (As of Today)

Warning Sign:

Beneish M-Score 2161.09 higher than -2.22, which implies that it might have manipulated its financial results.

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.

Revett Mining Company Inc has a M-score of 2,161.09 signals that the company is a manipulator.

RVM' s 10-Year Beneish M-Score Range
Min: -8.46   Max: 2161.09
Current: 2161.09

-8.46
2161.09

During the past 10 years, the highest Beneish M-Score of Revett Mining Company Inc was 2161.09. The lowest was -8.46. And the median was -1.62.


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 Revett Mining Company 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 * 2600.8275+0.528 * -0.0027+0.404 * 1.112+0.892 * 0.0012+0.115 * 80.3591
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1376.6864+4.679 * 0.098-0.327 * 0.5695
=2,161.09

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

This Year (Dec13) TTM:Last Year (Dec12) TTM:
Accounts Receivable was $1.16 Mil.
Revenue was 0.003 + -0.146 + 0 + 0.216 = $0.07 Mil.
Gross Profit was -0.293 + -0.59 + -0.322 + -4.521 = $-5.73 Mil.
Total Current Assets was $13.66 Mil.
Total Assets was $86.65 Mil.
Property, Plant and Equipment(Net PPE) was $65.11 Mil.
Depreciation, Depletion and Amortization(DDA) was $0.03 Mil.
Selling, General & Admin. Expense(SGA) was $11.51 Mil.
Total Current Liabilities was $3.09 Mil.
Long-Term Debt was $0.36 Mil.
Net Income was -2.801 + -0.6 + -4.055 + -4.119 = $-11.58 Mil.
Non Operating Income was 0 + 0 + -1.093 + -0.225 = $-1.32 Mil.
Cash Flow from Operations was -3.043 + -2.716 + -5.981 + -7.012 = $-18.75 Mil.
Accounts Receivable was $0.36 Mil.
Revenue was 7.205 + 19.351 + 13.49 + 19.163 = $59.21 Mil.
Gross Profit was -2.3 + 6.588 + 1.9 + 6.524 = $12.71 Mil.
Total Current Assets was $34.79 Mil.
Total Assets was $107.97 Mil.
Property, Plant and Equipment(Net PPE) was $64.36 Mil.
Depreciation, Depletion and Amortization(DDA) was $2.65 Mil.
Selling, General & Admin. Expense(SGA) was $6.78 Mil.
Total Current Liabilities was $6.27 Mil.
Long-Term Debt was $1.29 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)
=(1.164 / 0.073) / (0.363 / 59.209)
=15.94520548 / 0.00613082
=2600.8275

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)
=(-0.59 / 59.209) / (-0.293 / 0.073)
=0.21469709 / -78.43835616
=-0.0027

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 - (13.662 + 65.108) / 86.648) / (1 - (34.785 + 64.357) / 107.97)
=0.09091958 / 0.08176345
=1.112

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
=0.073 / 59.209
=0.0012

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))
=(2.645 / (2.645 + 64.357)) / (0.032 / (0.032 + 65.108))
=0.03947643 / 0.00049125
=80.3591

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)
=(11.508 / 0.073) / (6.78 / 59.209)
=157.64383562 / 0.11450962
=1376.6864

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)
=((0.364 + 3.09) / 86.648) / ((1.289 + 6.268) / 107.97)
=0.03986243 / 0.06999166
=0.5695

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
=(-11.575 - -1.318 - -18.752) / 86.648
=0.098

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.

Revett Mining Company Inc has a M-score of 2,161.09 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.

Revett Mining Company Inc Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 0.20634.15962.02220.88180.0922600.9134
GMI -5.9566-1.16740.11660.68111.7335-0.012
AQI 1.78361.01570.54891.090.82051.112
SGI 0.92430.92071.42041.49160.84450.0012
DEPI 0.80020.64171.08251.04941.061480.3592
SGAI 1.33570.55181.00461.16961.13811905.2284
LVGI 0.81791.09960.51360.97040.90090.5695
TATA -0.0488-0.068-0.0141-0.0926-0.06350.098
M-score -6.88-1.10-1.71-2.73-3.422,070.26

Revett Mining Company Inc Quarterly Data

Sep11Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13
DSRI 0.58960.88181.35890.43971.65240.0920.0560.0040.39962600.8255
GMI 0.47930.68120.70361.20991.3771.73379.0367-14.5707-0.2681-0.0027
AQI 0.93931.091.00660.96420.86180.82050.9230.99331.32481.112
SGI 1.46461.49161.60581.24831.20380.84450.52630.37580.09850.0012
DEPI 1.08271.04940.96691.04721.14871.06141.37281.9624.594280.3592
SGAI 1.40681.15190.36620.75840.73891.1383.15423.168215.04691376.6864
LVGI 0.61420.97041.25791.13351.30150.90090.62860.53270.44560.5695
TATA -0.065-0.0925-0.0566-0.1078-0.073-0.0626-0.0250.05760.09490.098
M-score -2.98-2.73-2.01-3.18-1.93-3.420.12-12.02-5.752,161.09
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