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Sirona Dental Systems Inc (NAS:SIRO)
Beneish M-Score
-2.68 (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 -2.68 suggests that the company is not a manipulator.

SIRO' s 10-Year Beneish M-Score Range
Min: -3.29   Max: 29.97
Current: -2.68

-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 * 0.9325+0.528 * 0.9694+0.404 * 0.8634+0.892 * 1.0333+0.115 * 0.9992
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0134+4.679 * -0.0337-0.327 * 0.7942
=-2.68

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

This Year (Dec14) TTM:Last Year (Dec13) TTM:
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.
Net Income was 46 + 42.7 + 51.5 + 37.3 = $178 Mil.
Non Operating Income was -1.1 + -3.5 + 1.1 + 0.1 = $-3 Mil.
Cash Flow from Operations was 4.2 + 117.9 + 51.6 + 67.6 = $241 Mil.
Accounts Receivable was $162 Mil.
Revenue was 298.7 + 278.6 + 283.2 + 267.3 = $1,128 Mil.
Gross Profit was 162.7 + 143.3 + 151.5 + 144.7 = $602 Mil.
Total Current Assets was $560 Mil.
Total Assets was $1,780 Mil.
Property, Plant and Equipment(Net PPE) was $220 Mil.
Depreciation, Depletion and Amortization(DDA) was $77 Mil.
Selling, General & Admin. Expense(SGA) was $335 Mil.
Total Current Liabilities was $225 Mil.
Long-Term Debt was $75 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)
=(155.7 / 1165.4) / (161.577 / 1127.8)
=0.1336022 / 0.14326742
=0.9325

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)
=(159.9 / 1127.8) / (162.9 / 1165.4)
=0.53395992 / 0.55079801
=0.9694

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 - (708.2 + 215.2) / 1793.9) / (1 - (560.098 + 219.709) / 1780.428)
=0.48525559 / 0.56201149
=0.8634

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
=1165.4 / 1127.8
=1.0333

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))
=(76.688 / (76.688 + 219.709)) / (75.2 / (75.2 + 215.2))
=0.25873406 / 0.25895317
=0.9992

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)
=(350.7 / 1165.4) / (334.9 / 1127.8)
=0.30092672 / 0.29694981
=1.0134

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 + 239.7) / 1793.9) / ((75 + 224.548) / 1780.428)
=0.13361949 / 0.16824494
=0.7942

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
=(177.5 - -3.4 - 241.3) / 1793.9
=-0.0337

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 -2.68 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 1.06881.14311.06840.8041.29870.78160.99431.26420.97380.7488
GMI 0.98831.02591.51391.01060.94070.93680.97880.98920.99640.9798
AQI 0.09831.279742.27660.93780.96120.92910.90591.07320.97030.8869
SGI 1.33061.33879.40451.14720.94211.07991.18641.07171.12471.0632
DEPI 1.29241.2040.54651.05931.09141.05621.16651.08770.87351.1502
SGAI 0.83820.89931.28961.03980.98390.96950.98990.99571.00080.9917
LVGI 0.79780.813.63340.97390.90360.88860.93570.56371.05670.9426
TATA -0.1282-0.0519-0.0114-0.0465-0.04-0.0626-0.0345-0.0427-0.0422-0.0375
M-score -2.96-2.0621.01-2.76-2.45-2.92-2.49-2.20-2.64-2.85

Sirona Dental Systems Inc Quarterly Data

Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14
DSRI 1.26421.12641.02670.81610.97380.97791.07611.46990.74880.9325
GMI 0.98920.97220.97060.97520.99651.01221.01621.00560.97980.9694
AQI 1.07320.9580.91990.91830.97030.87750.87750.86140.88690.8634
SGI 1.07171.06121.07931.12571.12471.1351.11091.08361.06321.0333
DEPI 1.08771.14281.10381.15030.87351.31951.35671.32091.15020.9992
SGAI 0.99571.00941.02320.99031.00070.95840.95060.9760.99191.0134
LVGI 0.56370.91541.09441.03481.05670.98340.95590.78860.94260.7942
TATA -0.0427-0.0514-0.0519-0.0518-0.0422-0.0259-0.031-0.0171-0.0375-0.0337
M-score -2.20-2.54-2.70-2.82-2.64-2.49-2.43-2.00-2.85-2.68
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