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Steelcase Inc (NYSE:SCS)
Beneish M-Score
-2.40 (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.

Steelcase Inc has a M-score of -2.40 suggests that the company is not a manipulator.

SCS' s 10-Year Beneish M-Score Range
Min: -3.23   Max: -2.33
Current: -2.4

-3.23
-2.33

During the past 13 years, the highest Beneish M-Score of Steelcase Inc was -2.33. The lowest was -3.23. And the median was -2.71.


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 Steelcase 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 * 1.0367+0.528 * 1.0563+0.404 * 1.0399+0.892 * 1.0237+0.115 * 1.0301
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9911+4.679 * -0.0046-0.327 * 1.0083
=-2.40

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

This Year (Feb15) TTM:Last Year (Feb14) TTM:
Accounts Receivable was $326 Mil.
Revenue was 749.9 + 800 + 786.7 + 723.1 = $3,060 Mil.
Gross Profit was 227.6 + 214.9 + 244.4 + 229.1 = $916 Mil.
Total Current Assets was $856 Mil.
Total Assets was $1,722 Mil.
Property, Plant and Equipment(Net PPE) was $390 Mil.
Depreciation, Depletion and Amortization(DDA) was $60 Mil.
Selling, General & Admin. Expense(SGA) was $768 Mil.
Total Current Liabilities was $545 Mil.
Long-Term Debt was $282 Mil.
Net Income was 22.8 + 11.8 + 30.5 + 21 = $86 Mil.
Non Operating Income was -0.4 + 2.6 + 3.7 + 3.9 = $10 Mil.
Cash Flow from Operations was 76.7 + 23.7 + 56.4 + -72.6 = $84 Mil.
Accounts Receivable was $307 Mil.
Revenue was 779.4 + 784.8 + 757.6 + 667.1 = $2,989 Mil.
Gross Profit was 248.4 + 242.8 + 244.3 + 209.7 = $945 Mil.
Total Current Assets was $890 Mil.
Total Assets was $1,727 Mil.
Property, Plant and Equipment(Net PPE) was $377 Mil.
Depreciation, Depletion and Amortization(DDA) was $60 Mil.
Selling, General & Admin. Expense(SGA) was $757 Mil.
Total Current Liabilities was $538 Mil.
Long-Term Debt was $284 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)
=(325.6 / 3059.7) / (306.8 / 2988.9)
=0.10641566 / 0.10264646
=1.0367

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)
=(214.9 / 2988.9) / (227.6 / 3059.7)
=0.31623674 / 0.29937576
=1.0563

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 - (855.5 + 389.5) / 1721.8) / (1 - (889.9 + 377) / 1726.7)
=0.2769195 / 0.2662883
=1.0399

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
=3059.7 / 2988.9
=1.0237

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))
=(60 / (60 + 377)) / (59.9 / (59.9 + 389.5))
=0.13729977 / 0.13328883
=1.0301

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)
=(768 / 3059.7) / (757 / 2988.9)
=0.251005 / 0.25327043
=0.9911

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)
=((281.8 + 545.3) / 1721.8) / ((284.4 + 538.2) / 1726.7)
=0.48036938 / 0.47640007
=1.0083

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
=(86.1 - 9.8 - 84.2) / 1721.8
=-0.0046

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.

Steelcase Inc has a M-score of -2.40 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.

Steelcase Inc Annual Data

Feb06Feb07Feb08Feb09Feb10Feb11Feb12Feb13Feb14Feb15
DSRI 0.92020.85521.01950.75861.20191.05090.88771.01461.02491.0367
GMI 0.96710.96390.95291.10761.02260.96310.99970.97550.95461.0563
AQI 0.99520.97871.15980.96481.15540.85671.17330.87990.80661.0399
SGI 1.09761.07961.10440.93070.71981.06341.12821.04341.04191.0237
DEPI 0.93841.05741.08280.96531.10720.96471.12260.98711.03191.0301
SGAI 0.95621.01630.95221.03541.06870.95890.94950.98380.99940.9911
LVGI 0.9731.0421.17921.00180.95621.22330.86841.02071.04371.0083
TATA -0.0544-0.0738-0.056-0.067-0.0008-0.0358-0.0331-0.0958-0.0522-0.0046
M-score -2.73-2.93-2.63-3.05-2.46-2.69-2.49-2.94-2.78-2.40

Steelcase Inc Quarterly Data

Nov12Feb13May13Aug13Nov13Feb14May14Aug14Nov14Feb15
DSRI 0.94141.01460.94910.97921.11041.02491.00370.97790.93581.0367
GMI 0.97130.97550.96040.96280.96820.95460.97070.99361.0271.0563
AQI 0.97130.87990.90840.92110.74550.80660.78020.80381.03361.0399
SGI 1.05791.04341.0271.01541.03291.04191.06441.06981.0541.0237
DEPI 1.02650.98711.00110.99530.971.03191.02431.05491.0661.0301
SGAI 1.00310.98380.99891.01260.9970.99940.97580.96360.9780.9911
LVGI 0.99651.02071.03381.03821.06311.04370.99591.01281.00921.0083
TATA -0.0684-0.0958-0.0967-0.0856-0.0704-0.0522-0.0309-0.0312-0.0041-0.0046
M-score -2.83-2.94-3.02-2.95-2.82-2.78-2.66-2.66-2.47-2.40
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