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Sirona Dental Systems Inc (NAS:SIRO)
Beneish M-Score
-2.50 (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 -2.50 suggests that the company is not a manipulator.

SIRO' s Beneish M-Score Range Over the Past 10 Years
Min: -3.45   Max: 29.97
Current: -2.5

-3.45
29.97

During the past 13 years, the highest Beneish M-Score of Sirona Dental Systems Inc was 29.97. The lowest was -3.45. 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 * 1.2314+0.528 * 0.9795+0.404 * 0.8743+0.892 * 1.0061+0.115 * 1.0331
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9996+4.679 * -0.0236-0.327 * 1.2117
=-2.50

* 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 $193 Mil.
Revenue was 304.2 + 304.9 + 306.1 + 257.3 = $1,173 Mil.
Gross Profit was 174 + 166.9 + 174.6 + 143.8 = $659 Mil.
Total Current Assets was $876 Mil.
Total Assets was $1,873 Mil.
Property, Plant and Equipment(Net PPE) was $203 Mil.
Depreciation, Depletion and Amortization(DDA) was $68 Mil.
Selling, General & Admin. Expense(SGA) was $353 Mil.
Total Current Liabilities was $303 Mil.
Long-Term Debt was $0 Mil.
Net Income was 51.3 + 45.4 + 58.8 + 36 = $192 Mil.
Non Operating Income was 1.5 + -5.9 + -2.2 + -2 = $-9 Mil.
Cash Flow from Operations was 9.3 + 107.7 + 58.1 + 69.2 = $244 Mil.
Accounts Receivable was $156 Mil.
Revenue was 293 + 290 + 299.7 + 282.7 = $1,165 Mil.
Gross Profit was 162.9 + 159.9 + 167.6 + 151.5 = $642 Mil.
Total Current Assets was $708 Mil.
Total Assets was $1,794 Mil.
Property, Plant and Equipment(Net PPE) was $215 Mil.
Depreciation, Depletion and Amortization(DDA) was $75 Mil.
Selling, General & Admin. Expense(SGA) was $351 Mil.
Total Current Liabilities was $240 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)
=(192.9 / 1172.5) / (155.7 / 1165.4)
=0.16452026 / 0.1336022
=1.2314

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)
=(166.9 / 1165.4) / (174 / 1172.5)
=0.55079801 / 0.56230277
=0.9795

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 - (875.8 + 202.7) / 1873.3) / (1 - (708.2 + 215.2) / 1793.9)
=0.42427801 / 0.48525559
=0.8743

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
=1172.5 / 1165.4
=1.0061

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))
=(75.2 / (75.2 + 215.2)) / (67.8 / (67.8 + 202.7))
=0.25895317 / 0.25064695
=1.0331

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)
=(352.7 / 1172.5) / (350.7 / 1165.4)
=0.30081023 / 0.30092672
=0.9996

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 + 303.3) / 1873.3) / ((0 + 239.7) / 1793.9)
=0.1619068 / 0.13361949
=1.2117

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
=(191.5 - -8.6 - 244.3) / 1873.3
=-0.0236

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 -2.50 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

Mar06Sep07Sep08Sep09Sep10Sep11Sep12Sep13Sep14Sep15
DSRI 1.14311.06840.8041.29870.78160.99431.26410.97390.74881.3513
GMI 1.02591.51391.01060.94070.93680.97880.98920.99650.97980.9817
AQI 1.279742.27660.93780.96120.92910.90591.07320.97030.81530.8619
SGI 1.33879.40451.14720.94211.07991.18641.07171.12471.06320.9916
DEPI 1.2040.54651.05931.09141.05621.16651.08820.87321.56851.0225
SGAI 0.89931.28961.03980.98390.96950.98990.99551.0010.99170.9889
LVGI 0.813.63340.97390.90360.88860.93570.56371.05670.93361.0596
TATA -0.0519-0.0114-0.0465-0.04-0.0626-0.0345-0.0428-0.0422-0.0375-0.022
M-score -2.0621.01-2.76-2.45-2.92-2.49-2.20-2.64-2.83-2.35

Sirona Dental Systems Inc Quarterly Data

Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15
DSRI 0.97390.9781.07621.470.74880.93250.90051.08281.35131.2314
GMI 0.99651.01221.01631.00570.97980.96940.95760.96370.98170.9795
AQI 0.97030.87750.87750.86140.81530.86340.83890.85540.86190.8743
SGI 1.12471.1351.11081.08351.06321.03330.99720.98850.99161.0061
DEPI 0.87321.31891.35611.32031.56850.99920.91320.97131.02251.0331
SGAI 1.00090.95860.95080.97630.99191.01341.02660.99870.98890.9996
LVGI 1.05670.98340.95590.78860.93360.79420.90481.22531.05961.2117
TATA -0.0422-0.0259-0.031-0.0171-0.0375-0.0337-0.0357-0.031-0.022-0.0236
M-score -2.64-2.49-2.43-2.00-2.83-2.68-2.81-2.71-2.35-2.50
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