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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.
During the past 12 years, the highest Beneish M-Score of IBI Group Inc was -1.65. The lowest was -7.16. And the median was -2.43.
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 IBI Group 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 * 0.8631||+||0.528 * 1||+||0.404 * 0.9668||+||0.892 * 1.0905||+||0.115 * 0.8286|
|-||0.172 * SGAI||+||4.679 * TATA||-||0.327 * LVGI|
|-||0.172 * 0.9562||+||4.679 * -0.1285||-||0.327 * 0.9736|
|This Year (Mar16) TTM:||Last Year (Mar15) TTM:|
|Accounts Receivable was C$104.2 Mil.|
Revenue was 88.645 + 84.913 + 83.819 + 80.879 = C$338.3 Mil.
Gross Profit was 88.645 + 84.913 + 83.819 + 80.879 = C$338.3 Mil.
Total Current Assets was C$210.0 Mil.
Total Assets was C$249.3 Mil.
Property, Plant and Equipment(Net PPE) was C$14.5 Mil.
Depreciation, Depletion and Amortization(DDA) was C$5.1 Mil.
Selling, General & Admin. Expense(SGA) was C$260.4 Mil.
Total Current Liabilities was C$105.0 Mil.
Long-Term Debt was C$155.6 Mil.
Net Income was -3.066 + 0.413 + 3.755 + 1.243 = C$2.3 Mil.
Non Operating Income was -0.441 + 5.191 + -2.109 + -0.409 = C$2.2 Mil.
Cash Flow from Operations was 5.807 + 14.246 + 11.626 + 0.481 = C$32.2 Mil.
|Accounts Receivable was C$110.7 Mil.
Revenue was 77.481 + 75.03 + 73.605 + 84.067 = C$310.2 Mil.
Gross Profit was 77.481 + 75.03 + 73.605 + 84.067 = C$310.2 Mil.
Total Current Assets was C$219.8 Mil.
Total Assets was C$260.0 Mil.
Property, Plant and Equipment(Net PPE) was C$13.4 Mil.
Depreciation, Depletion and Amortization(DDA) was C$3.7 Mil.
Selling, General & Admin. Expense(SGA) was C$249.7 Mil.
Total Current Liabilities was C$176.4 Mil.
Long-Term Debt was C$102.6 Mil.
1. DSRI = Days Sales in Receivables Index
A large increase in DSR could be indicative of revenue inflation.
|DSRI||=||(Receivables_t / Revenue_t)||/||(Receivables_t-1 / Revenue_t-1)|
|=||(104.22 / 338.256)||/||(110.73 / 310.183)|
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.
|=||(GrossProfit_t-1 / Revenue_t-1)||/||(GrossProfit_t / Revenue_t)|
|=||(310.183 / 310.183)||/||(338.256 / 338.256)|
3. AQI = Asset Quality Index
AQI is the ratio of asset quality in year t to year t-1.
|AQI||=||(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t)||/||(1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)|
|=||(1 - (210.027 + 14.498) / 249.346)||/||(1 - (219.782 + 13.411) / 259.958)|
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.
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))|
|=||(3.68 / (3.68 + 13.411))||/||(5.09 / (5.09 + 14.498))|
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)|
|=||(260.381 / 338.256)||/||(249.704 / 310.183)|
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)|
|=||((155.593 + 104.98) / 249.346)||/||((102.647 + 176.389) / 259.958)|
8. TATA = Total Accruals to Total Assets
Total accruals calculated as the change in working capital accounts other than cash less depreciation.
|=||(NetIncome_t - NonOperatingIncome_t||-||CashFlowsfromOperations_t)||/||TotalAssets_t|
|=||(2.345 - 2.232||-||32.16)||/||249.346|
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.
IBI Group Inc has a M-score of -3.14 suggests that the company will not be a manipulator.
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
IBI Group Inc Annual Data
IBI Group Inc Quarterly Data