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TRC Companies Inc (NYSE:TRR)
Beneish M-Score
-2.58 (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.

TRC Companies Inc has a M-score of -2.58 suggests that the company is not a manipulator.

TRR' s Beneish M-Score Range Over the Past 10 Years
Min: -200.6   Max: 4.15
Current: -2.58

-200.6
4.15

During the past 13 years, the highest Beneish M-Score of TRC Companies Inc was 4.15. The lowest was -200.60. And the median was -2.69.


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 TRC Companies 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 * 1.0089+0.528 * 0.9044+0.404 * 1.428+0.892 * 1.1143+0.115 * 1.3736
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0524+4.679 * -0.0485-0.327 * 1.4161
=-2.58

* 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 $152.6 Mil.
Revenue was 112.44 + 100.92 + 114.892 + 101.77 = $430.0 Mil.
Gross Profit was 18.764 + 17.936 + 24.876 + 18.284 = $79.9 Mil.
Total Current Assets was $248.6 Mil.
Total Assets was $492.2 Mil.
Property, Plant and Equipment(Net PPE) was $22.4 Mil.
Depreciation, Depletion and Amortization(DDA) was $9.5 Mil.
Selling, General & Admin. Expense(SGA) was $36.6 Mil.
Total Current Liabilities was $171.8 Mil.
Long-Term Debt was $96.6 Mil.
Net Income was 3.937 + 4.492 + 6.763 + 5.165 = $20.4 Mil.
Non Operating Income was -0.027 + -0.015 + -0.03 + -0.023 = $-0.1 Mil.
Cash Flow from Operations was -0.952 + 14.388 + 19.535 + 11.374 = $44.3 Mil.
Accounts Receivable was $135.8 Mil.
Revenue was 100.501 + 97.485 + 94.779 + 93.162 = $385.9 Mil.
Gross Profit was 17.902 + 16.295 + 17.585 + 13.035 = $64.8 Mil.
Total Current Assets was $220.8 Mil.
Total Assets was $341.9 Mil.
Property, Plant and Equipment(Net PPE) was $13.5 Mil.
Depreciation, Depletion and Amortization(DDA) was $9.3 Mil.
Selling, General & Admin. Expense(SGA) was $31.2 Mil.
Total Current Liabilities was $131.5 Mil.
Long-Term Debt was $0.1 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)
=(152.608 / 430.022) / (135.754 / 385.927)
=0.35488417 / 0.35176083
=1.0089

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)
=(17.936 / 385.927) / (18.764 / 430.022)
=0.16795145 / 0.18571143
=0.9044

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 - (248.577 + 22.411) / 492.198) / (1 - (220.767 + 13.492) / 341.85)
=0.44943295 / 0.31473161
=1.428

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
=430.022 / 385.927
=1.1143

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))
=(9.28 / (9.28 + 13.492)) / (9.454 / (9.454 + 22.411))
=0.407518 / 0.29668916
=1.3736

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)
=(36.594 / 430.022) / (31.207 / 385.927)
=0.08509797 / 0.08086244
=1.0524

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)
=((96.563 + 171.831) / 492.198) / ((0.097 + 131.537) / 341.85)
=0.54529681 / 0.38506362
=1.4161

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
=(20.357 - -0.095 - 44.345) / 492.198
=-0.0485

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.

TRC Companies Inc has a M-score of -2.58 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.

TRC Companies Inc Annual Data

Jun06Jun07Jun08Jun09Jun10Jun11Jun12Jun13Jun14Jun15
DSRI 0.81451.02270.85960.49311.65221.00290.42832.15260.93281.0639
GMI 0.26030.40730.73871.21970.71180.87350.93521.06611.06820.8736
AQI 1.031.0010.86070.88520.91261.01230.97080.90390.85720.9003
SGI 1.08391.07531.08741.63120.52771.02181.23671.07421.14681.112
DEPI 0.95171.03630.91350.93620.80551.40791.00850.860.82650.9954
SGAI 1.53460.72761.45750.50381.49750.98840.95440.92230.88091.071
LVGI 0.94421.07421.37960.97550.96661.10470.83270.91730.97161.0068
TATA -0.0667-0.0312-0.2842-0.1332-0.1016-0.07790.05250.0718-0.0277-0.0347
M-score -3.35-2.82-4.27-2.85-3.06-2.87-2.53-1.00-2.55-2.61

TRC Companies Inc Quarterly Data

Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15
DSRI 0.97341.00810.98850.93280.63481.07531.00571.06390.9641.0089
GMI 1.06771.0191.04511.06821.04231.03050.940.87360.8690.9044
AQI 0.8950.88670.85210.85720.91420.9560.9330.90030.8221.428
SGI 1.1171.15981.15731.14681.10251.08151.07851.1121.10971.1143
DEPI 0.83790.81710.81630.82650.84380.92570.94260.99541.23261.3736
SGAI 0.94440.99821.00780.88090.85050.8450.8561.0711.0981.0524
LVGI 0.9170.94090.91070.97160.95370.99470.98451.00681.02981.4161
TATA 0.04630.06270.0536-0.0274-0.028-0.0408-0.0378-0.0347-0.0622-0.0485
M-score -2.17-2.07-2.13-2.55-2.85-2.51-2.62-2.61-2.85-2.58
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