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Western Union Co (NYSE:WU)
Beneish M-Score
-2.53 (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.

Western Union Co has a M-score of -2.53 suggests that the company is not a manipulator.

WU' s 10-Year Beneish M-Score Range
Min: -5.25   Max: 62.73
Current: -2.53

-5.25
62.73

During the past 13 years, the highest Beneish M-Score of Western Union Co was 62.73. The lowest was -5.25. And the median was -2.62.


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 Western Union Co 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+0.528 * 0.9971+0.404 * 1.0488+0.892 * 1.0018+0.115 * 0.974
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.959+4.679 * -0.0194-0.327 * 0.9382
=-2.53

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

This Year (Mar15) TTM:Last Year (Mar14) TTM:
Accounts Receivable was $0 Mil.
Revenue was 1320.9 + 1409.9 + 1440.9 + 1405.6 = $5,577 Mil.
Gross Profit was 549.1 + 578 + 600.4 + 577.8 = $2,305 Mil.
Total Current Assets was $5,227 Mil.
Total Assets was $10,353 Mil.
Property, Plant and Equipment(Net PPE) was $203 Mil.
Depreciation, Depletion and Amortization(DDA) was $269 Mil.
Selling, General & Admin. Expense(SGA) was $1,165 Mil.
Total Current Liabilities was $4,556 Mil.
Long-Term Debt was $3,729 Mil.
Net Income was 203.9 + 221.5 + 234.1 + 193.8 = $853 Mil.
Non Operating Income was -0.8 + 0.1 + 0.1 + -5.7 = $-6 Mil.
Cash Flow from Operations was 211.8 + 270.6 + 325.2 + 253.3 = $1,061 Mil.
Accounts Receivable was $0 Mil.
Revenue was 1350.8 + 1421.9 + 1408.8 + 1385.9 = $5,567 Mil.
Gross Profit was 553.6 + 576.2 + 590.6 + 574.2 = $2,295 Mil.
Total Current Assets was $5,210 Mil.
Total Assets was $9,923 Mil.
Property, Plant and Equipment(Net PPE) was $214 Mil.
Depreciation, Depletion and Amortization(DDA) was $267 Mil.
Selling, General & Admin. Expense(SGA) was $1,212 Mil.
Total Current Liabilities was $4,749 Mil.
Long-Term Debt was $3,714 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)
=(0 / 5577.3) / (0 / 5567.4)
=0 / 0
=1

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)
=(578 / 5567.4) / (549.1 / 5577.3)
=0.4121493 / 0.4133362
=0.9971

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 - (5227.4 + 202.6) / 10353) / (1 - (5209.9 + 214) / 9922.6)
=0.47551434 / 0.45337915
=1.0488

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
=5577.3 / 5567.4
=1.0018

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))
=(267.1 / (267.1 + 214)) / (268.6 / (268.6 + 202.6))
=0.55518603 / 0.57003396
=0.974

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)
=(1164.5 / 5577.3) / (1212.1 / 5567.4)
=0.20879279 / 0.21771383
=0.959

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)
=((3728.6 + 4556) / 10353) / ((3714.1 + 4749.2) / 9922.6)
=0.8002125 / 0.85293169
=0.9382

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
=(853.3 - -6.3 - 1060.9) / 10353
=-0.0194

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.

Western Union Co has a M-score of -2.53 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.

Western Union Co Annual Data

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 0.75181.10280.01950.6351.116571.72210.014464.29771.0142
GMI 1.02711.06891.03010.95391.01890.980.99771.04771.0105
AQI 0.98280.92370.99690.91170.89961.40430.93570.99211.0276
SGI 1.12091.09621.07790.96241.02151.05751.03160.97831.0118
DEPI 1.32650.96860.89250.99550.91060.95820.88581.0010.978
SGAI 1.08320.96421.00511.15360.96651.03891.10081.0750.9634
LVGI 3.2150.93291.00380.95710.97681.01551.00290.97910.958
TATA -0.0369-0.0443-0.0618-0.0499-0.0122-0.0084-0.0182-0.0292-0.0188
M-score -3.47-2.48-3.60-3.16-2.4462.73-3.5055.61-2.51

Western Union Co Quarterly Data

Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15
DSRI 0.014401.0989064.29771011.01421
GMI 0.99771.01391.02931.04631.04771.05181.03791.02661.01050.9971
AQI 0.93570.98390.96980.98020.99210.95880.95610.99331.02761.0488
SGI 1.03160.99910.98180.97770.97830.99471.00531.01341.01181.0018
DEPI 0.88580.93970.96290.98971.0010.99480.98250.98170.9780.974
SGAI 1.10081.07111.07431.10031.0751.07661.05251.00520.96340.959
LVGI 1.00291.05721.00841.00830.97910.97940.98750.98060.9580.9382
TATA -0.0182-0.0247-0.0321-0.0283-0.0292-0.0263-0.0274-0.0246-0.0188-0.0194
M-score -3.50-3.55-2.57-3.5655.61-2.60-3.53-2.57-2.51-2.53
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