Switch to:
YRC Worldwide Inc (NAS:YRCW)
Beneish M-Score
-2.72 (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.

YRC Worldwide Inc has a M-score of -2.72 suggests that the company is not a manipulator.

YRCW' s 10-Year Beneish M-Score Range
Min: -5.32   Max: 0.83
Current: -2.72

-5.32
0.83

During the past 13 years, the highest Beneish M-Score of YRC Worldwide Inc was 0.83. The lowest was -5.32. And the median was -2.79.


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 YRC Worldwide 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 * 1.023+0.528 * 1.0173+0.404 * 0.7935+0.892 * 1.0371+0.115 * 0.9553
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0044+4.679 * -0.0515-0.327 * 0.9296
=-2.72

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

This Year (Jun14) TTM:Last Year (Jun13) TTM:
Accounts Receivable was $557 Mil.
Revenue was 1317.6 + 1210.9 + 1207.7 + 1252.7 = $4,989 Mil.
Gross Profit was 865.8 + 795.3 + 795.9 + 829.3 = $3,286 Mil.
Total Current Assets was $960 Mil.
Total Assets was $2,180 Mil.
Property, Plant and Equipment(Net PPE) was $1,031 Mil.
Depreciation, Depletion and Amortization(DDA) was $167 Mil.
Selling, General & Admin. Expense(SGA) was $2,871 Mil.
Total Current Liabilities was $758 Mil.
Long-Term Debt was $1,083 Mil.
Net Income was -4.9 + -70.2 + 0.4 + -44.4 = $-119 Mil.
Non Operating Income was -1.1 + 16.3 + 3 + 0.2 = $18 Mil.
Cash Flow from Operations was 0.6 + -56.2 + 15.1 + 15.2 = $-25 Mil.
Accounts Receivable was $525 Mil.
Revenue was 1242.5 + 1162.5 + 1168.6 + 1236.8 = $4,810 Mil.
Gross Profit was 831 + 779.8 + 778 + 834.6 = $3,223 Mil.
Total Current Assets was $790 Mil.
Total Assets was $2,173 Mil.
Property, Plant and Equipment(Net PPE) was $1,145 Mil.
Depreciation, Depletion and Amortization(DDA) was $176 Mil.
Selling, General & Admin. Expense(SGA) was $2,756 Mil.
Total Current Liabilities was $685 Mil.
Long-Term Debt was $1,290 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)
=(556.6 / 4988.9) / (524.6 / 4810.4)
=0.11156768 / 0.10905538
=1.023

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)
=(795.3 / 4810.4) / (865.8 / 4988.9)
=0.67008981 / 0.65872236
=1.0173

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 - (959.5 + 1031.1) / 2179.5) / (1 - (790.1 + 1145.1) / 2172.5)
=0.08667125 / 0.109229
=0.7935

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
=4988.9 / 4810.4
=1.0371

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))
=(176.1 / (176.1 + 1145.1)) / (167.2 / (167.2 + 1031.1))
=0.13328792 / 0.139531
=0.9553

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)
=(2871 / 4988.9) / (2756.2 / 4810.4)
=0.57547756 / 0.57296691
=1.0044

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)
=((1083.4 + 758.3) / 2179.5) / ((1290.3 + 684.6) / 2172.5)
=0.84501032 / 0.90904488
=0.9296

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
=(-119.1 - 18.4 - -25.3) / 2179.5
=-0.0515

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.

YRC Worldwide Inc has a M-score of -2.72 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.

YRC Worldwide Inc Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 0.5051.15780.90130.92970.83881.04291.04550.95930.96860.9987
GMI 1.01421.09421.01940.95631.05481.02090.95211.04830.96731.0021
AQI 0.93491.1270.99930.72110.29811.43320.96111.18380.93280.7345
SGI 2.20541.29171.13470.970.92920.59090.82051.12320.99621.0031
DEPI 0.54511.05440.94651.11150.90450.87991.05040.90830.95550.979
SGAI 0.95780.91920.9891.03190.98761.19170.88790.92690.99411.0029
LVGI 0.90091.0960.85331.15521.33581.00591.11551.13581.08411.0656
TATA -0.0517-0.0254-0.0284-0.2032-0.3027-0.1313-0.1192-0.1035-0.04-0.0493
M-score -2.13-2.10-2.53-3.70-4.48-3.28-3.21-2.83-2.78-2.84

YRC Worldwide Inc Quarterly Data

Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14
DSRI 0.88940.87530.91980.96861.05791.06231.01560.99871.04031.023
GMI 1.03791.01420.99150.96730.96430.97510.98931.00211.01331.0173
AQI 1.24191.29891.18390.93280.88420.87690.51820.73450.82960.7935
SGI 1.10511.07061.03080.99620.97540.9750.98611.00311.01971.0371
DEPI 0.89540.88360.87410.95550.99311.00411.01130.9790.96310.9553
SGAI 0.95040.97950.98210.99410.99770.98920.99631.00291.01091.0044
LVGI 1.11491.09841.1491.08411.07311.07321.07111.06560.93190.9296
TATA -0.1091-0.111-0.0736-0.0401-0.0142-0.0086-0.0528-0.0493-0.0547-0.0515
M-score -2.92-2.96-2.86-2.78-2.61-2.57-2.95-2.84-2.73-2.72
Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)
Free 7-day Trial
FEEDBACK