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Sirona Dental Systems Inc (NAS:SIRO)
Beneish M-Score
-2.71 (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.

Sirona Dental Systems Inc has a M-score of -2.71 suggests that the company is not a manipulator.

SIRO' s 10-Year Beneish M-Score Range
Min: -3.29   Max: 29.97
Current: -2.71

-3.29
29.97

During the past 13 years, the highest Beneish M-Score of Sirona Dental Systems Inc was 29.97. The lowest was -3.29. And the median was -2.43.


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 Sirona Dental Systems 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 * 1.0828+0.528 * 0.9637+0.404 * 0.8554+0.892 * 0.9885+0.115 * 0.9711
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9964+4.679 * -0.031-0.327 * 1.2253
=-2.71

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

This Year (Jun15) TTM:Last Year (Jun14) TTM:
Accounts Receivable was $184 Mil.
Revenue was 306.1 + 257.3 + 293 + 290 = $1,146 Mil.
Gross Profit was 174.6 + 143.8 + 162.9 + 159.9 = $641 Mil.
Total Current Assets was $811 Mil.
Total Assets was $1,839 Mil.
Property, Plant and Equipment(Net PPE) was $208 Mil.
Depreciation, Depletion and Amortization(DDA) was $72 Mil.
Selling, General & Admin. Expense(SGA) was $342 Mil.
Total Current Liabilities was $294 Mil.
Long-Term Debt was $0 Mil.
Net Income was 58.8 + 36 + 46 + 42.7 = $184 Mil.
Non Operating Income was -2.2 + -2 + -1.1 + -3.5 = $-9 Mil.
Cash Flow from Operations was 58.1 + 69.2 + 4.2 + 117.9 = $249 Mil.
Accounts Receivable was $172 Mil.
Revenue was 299.7 + 282.7 + 298.726 + 278.604 = $1,160 Mil.
Gross Profit was 167.6 + 151.5 + 162.731 + 143.291 = $625 Mil.
Total Current Assets was $664 Mil.
Total Assets was $1,870 Mil.
Property, Plant and Equipment(Net PPE) was $230 Mil.
Depreciation, Depletion and Amortization(DDA) was $77 Mil.
Selling, General & Admin. Expense(SGA) was $347 Mil.
Total Current Liabilities was $244 Mil.
Long-Term Debt was $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)
=(184 / 1146.4) / (171.9 / 1159.73)
=0.16050244 / 0.14822416
=1.0828

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)
=(143.8 / 1159.73) / (174.6 / 1146.4)
=0.53902374 / 0.55931612
=0.9637

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 - (810.5 + 207.6) / 1839.2) / (1 - (663.6 + 230.3) / 1869.7)
=0.44644411 / 0.52190191
=0.8554

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
=1146.4 / 1159.73
=0.9885

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))
=(76.583 / (76.583 + 230.3)) / (71.8 / (71.8 + 207.6))
=0.24955113 / 0.25697924
=0.9711

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)
=(341.5 / 1146.4) / (346.729 / 1159.73)
=0.29788904 / 0.2989739
=0.9964

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 + 294.1) / 1839.2) / ((0 + 244) / 1869.7)
=0.15990648 / 0.13050222
=1.2253

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
=(183.5 - -8.8 - 249.4) / 1839.2
=-0.031

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.

Sirona Dental Systems Inc has a M-score of -2.71 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.

Sirona Dental Systems Inc Annual Data

Mar05Mar06Sep07Sep08Sep09Sep10Sep11Sep12Sep13Sep14
DSRI 1.06881.14311.06840.8041.29870.78160.99431.26420.97390.7488
GMI 0.98831.02591.51391.01060.94070.93680.97880.98920.99650.9798
AQI 0.09831.279742.27660.93780.96120.92910.90591.07320.9060.9499
SGI 1.33061.33879.40451.14720.94211.07991.18641.07171.12471.0632
DEPI 1.29241.2040.54651.05931.09691.05091.16651.08771.20170.8361
SGAI 0.83820.89931.28961.03980.98390.96950.98990.99571.0010.9916
LVGI 0.79780.813.63340.97390.90360.88860.93570.56371.05670.9426
TATA -0.1282-0.0519-0.0114-0.0465-0.0408-0.0571-0.0278-0.0427-0.0423-0.0375
M-score -2.96-2.0621.01-2.76-2.45-2.89-2.46-2.20-2.63-2.86

Sirona Dental Systems Inc Quarterly Data

Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15
DSRI 1.02660.81610.97390.97791.07621.46980.74870.93250.90051.0828
GMI 0.97060.97520.99651.01221.01621.00560.97980.96940.95760.9637
AQI 0.91990.91830.9060.87750.87750.86140.94990.86340.83890.8554
SGI 1.07931.12571.12471.1351.11091.08361.06321.03330.99720.9885
DEPI 1.10421.151.20171.31941.35561.32140.8360.99920.91360.9711
SGAI 1.02130.98831.0010.95930.95440.98040.99171.01271.02430.9964
LVGI 1.09441.03481.05670.98340.95590.78860.94260.79420.90481.2253
TATA -0.0518-0.0518-0.0423-0.026-0.0312-0.0172-0.0375-0.0337-0.0357-0.031
M-score -2.70-2.82-2.63-2.50-2.43-2.00-2.86-2.68-2.81-2.71
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