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GuruFocus has detected 6 Warning Signs with Yahoo Japan Corp $YAHOY.
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Yahoo Japan Corp (OTCPK:YAHOY)
Beneish M-Score
-1.85 (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.

Yahoo Japan Corp has a M-score of -1.70 signals that the company is a manipulator.

YAHOY' s Beneish M-Score Range Over the Past 10 Years
Min: -3.38   Max: -1.25
Current: -1.85

-3.38
-1.25

During the past 13 years, the highest Beneish M-Score of Yahoo Japan Corp was -1.25. The lowest was -3.38. And the median was -1.89.


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 Yahoo Japan Corp 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 * 1.2264+0.404 * 1.2245+0.892 * 1.6601+0.115 * 0.8161
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9681+4.679 * 0.0115-0.327 * 1.1802
=-1.70

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

This Year (Dec16) TTM:Last Year (Dec15) TTM:
Accounts Receivable was $0 Mil.
Revenue was 1908.31573965 + 2017.3543464 + 1938.85386836 + 1833.22308971 = $7,698 Mil.
Gross Profit was 1075.10381636 + 1135.6663061 + 1073.04256537 + 1009.96442983 = $4,294 Mil.
Total Current Assets was $7,747 Mil.
Total Assets was $12,673 Mil.
Property, Plant and Equipment(Net PPE) was $1,178 Mil.
Depreciation, Depletion and Amortization(DDA) was $346 Mil.
Selling, General & Admin. Expense(SGA) was $2,613 Mil.
Total Current Liabilities was $3,681 Mil.
Long-Term Debt was $217 Mil.
Net Income was 307.591245029 + 330.217921624 + 337.045056093 + 160.149895911 = $1,135 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0 Mil.
Cash Flow from Operations was 157.338783997 + 468.746162227 + 97.4932345144 + 265.576450191 = $989 Mil.
Accounts Receivable was $0 Mil.
Revenue was 1614.88058536 + 1151.042551 + 893.770217251 + 977.212414188 = $4,637 Mil.
Gross Profit was 900.842685082 + 789.886772603 + 698.520675145 + 782.79323391 = $3,172 Mil.
Total Current Assets was $7,187 Mil.
Total Assets was $10,699 Mil.
Property, Plant and Equipment(Net PPE) was $928 Mil.
Depreciation, Depletion and Amortization(DDA) was $211 Mil.
Selling, General & Admin. Expense(SGA) was $1,626 Mil.
Total Current Liabilities was $2,788 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)
=(0 / 7697.74704412) / (0 / 4636.90576779)
=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)
=(3172.04336674 / 4636.90576779) / (4293.77711765 / 7697.74704412)
=0.68408623 / 0.5577966
=1.2264

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 - (7746.91999266 + 1177.53652862) / 12673.4230992) / (1 - (7186.73079295 + 927.751058495) / 10699.107987)
=0.29581326 / 0.24157398
=1.2245

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
=7697.74704412 / 4636.90576779
=1.6601

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))
=(211.259412391 / (211.259412391 + 927.751058495)) / (346.320608775 / (346.320608775 + 1177.53652862))
=0.18547627 / 0.2272658
=0.8161

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)
=(2613.22491665 / 7697.74704412) / (1626.02738176 / 4636.90576779)
=0.33947919 / 0.35067078
=0.9681

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)
=((216.529408671 + 3681.06029323) / 12673.4230992) / ((0 + 2787.93110536) / 10699.107987)
=0.30754041 / 0.26057603
=1.1802

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
=(1135.00411866 - 0 - 989.15463093) / 12673.4230992
=0.0115

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.

Yahoo Japan Corp has a M-score of -1.70 signals that the company is likely to 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 local exchange's currency.

Yahoo Japan Corp Annual Data

Mar07Mar08Mar09Mar10Mar11Mar12Mar13Mar14Mar15Mar16
DSRI 0.98021.10881
GMI 0.96461.07611.2894
AQI 2.49910.87141.5714
SGI 1.22391.43471.623
DEPI 0.96870.75810.9924
SGAI 1.015601.0799
LVGI 1.66060.81321.1455
TATA -0.033-0.05110.0493
M-score -2.09-2.04-1.37

Yahoo Japan Corp Quarterly Data

Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16Dec16
DSRI 111111
GMI 1.06871.19161.29361.37741.36991.2264
AQI 1.40771.34121.57141.54371.24291.2245
SGI 0.9971.22121.4381.75081.88721.6601
DEPI 1.22691.14721.09091.06420.76690.8161
SGAI 4.07642.08091.42541.02510.97150.9681
LVGI 1.04781.14091.14551.18541.1331.1802
TATA 0.05020.04160.04530.05010.00830.0115
M-score -2.57-2.06-1.60-1.21-1.42-1.70
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