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YRC Worldwide Inc (NAS:YRCW)
Beneish M-Score
-3.06 (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 -3.06 suggests that the company is not a manipulator.

YRCW' s Beneish M-Score Range Over the Past 10 Years
Min: -5.32   Max: 1.48
Current: -3.06

-5.32
1.48

During the past 13 years, the highest Beneish M-Score of YRC Worldwide Inc was 1.48. The lowest was -5.32. And the median was -2.82.


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 * 1.0039+0.528 * 0.9702+0.404 * 0.5401+0.892 * 0.9561+0.115 * 0.9774
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0513+4.679 * -0.0713-0.327 * 1.0046
=-3.06

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

This Year (Sep16) TTM:Last Year (Sep15) TTM:
Accounts Receivable was $478 Mil.
Revenue was 1221.3 + 1207.6 + 1120.3 + 1142.7 = $4,692 Mil.
Gross Profit was 857.6 + 872.3 + 814.6 + 812.3 = $3,357 Mil.
Total Current Assets was $873 Mil.
Total Assets was $1,871 Mil.
Property, Plant and Equipment(Net PPE) was $888 Mil.
Depreciation, Depletion and Amortization(DDA) was $160 Mil.
Selling, General & Admin. Expense(SGA) was $2,852 Mil.
Total Current Liabilities was $582 Mil.
Long-Term Debt was $1,024 Mil.
Net Income was 13.9 + 27.1 + -12 + -23.5 = $6 Mil.
Non Operating Income was 1.2 + 0.8 + -1.1 + 2.7 = $4 Mil.
Cash Flow from Operations was 38.5 + 58.6 + -11.1 + 49.3 = $135 Mil.
Accounts Receivable was $498 Mil.
Revenue was 1244.9 + 1258.4 + 1186.4 + 1217.7 = $4,907 Mil.
Gross Profit was 878.2 + 877.6 + 824.8 + 825.9 = $3,407 Mil.
Total Current Assets was $811 Mil.
Total Assets was $1,965 Mil.
Property, Plant and Equipment(Net PPE) was $939 Mil.
Depreciation, Depletion and Amortization(DDA) was $164 Mil.
Selling, General & Admin. Expense(SGA) was $2,838 Mil.
Total Current Liabilities was $614 Mil.
Long-Term Debt was $1,065 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)
=(477.8 / 4691.9) / (497.8 / 4907.4)
=0.10183508 / 0.10143864
=1.0039

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)
=(3406.5 / 4907.4) / (3356.8 / 4691.9)
=0.69415576 / 0.71544577
=0.9702

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 - (872.5 + 887.8) / 1870.6) / (1 - (811.4 + 938.9) / 1964.8)
=0.05896504 / 0.10917142
=0.5401

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
=4691.9 / 4907.4
=0.9561

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))
=(164.3 / (164.3 + 938.9)) / (159.6 / (159.6 + 887.8))
=0.14893038 / 0.15237732
=0.9774

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)
=(2852.2 / 4691.9) / (2837.5 / 4907.4)
=0.60789872 / 0.57820842
=1.0513

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)
=((1023.9 + 582.4) / 1870.6) / ((1065.3 + 614.1) / 1964.8)
=0.85870844 / 0.85474349
=1.0046

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
=(5.5 - 3.6 - 135.3) / 1870.6
=-0.0713

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 -3.06 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 local exchange's currency.

YRC Worldwide Inc Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
DSRI 0.90130.92970.83881.04291.04550.95930.96860.99870.97990.9528
GMI 1.01940.95631.05481.02090.95211.04830.96731.00211.00120.9461
AQI 0.99930.72110.29811.43320.96111.18380.93280.73451.40360.9767
SGI 1.13470.970.92920.59090.82051.12320.99621.00311.04180.9534
DEPI 0.94651.11150.90450.87991.05040.90830.95550.9790.96610.9504
SGAI 0.9891.03190.98761.19170.88790.92690.99411.00290.99351.037
LVGI 0.85331.15521.33581.00591.11551.13581.08411.06560.90231.0184
TATA -0.0429-0.2032-0.3027-0.1313-0.1192-0.1035-0.04-0.0493-0.0589-0.0793
M-score -2.60-3.70-4.48-3.28-3.21-2.83-2.78-2.84-2.54-2.99

YRC Worldwide Inc Quarterly Data

Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16
DSRI 1.0231.01420.97990.93740.92220.93010.95280.95160.99661.0039
GMI 1.01731.01081.00120.98270.96340.95030.94610.94880.95460.9702
AQI 0.79351.21551.40361.30881.24961.24610.97670.86780.58160.5401
SGI 1.03711.04821.04181.02660.99920.97010.95340.94490.94590.9561
DEPI 0.95530.96650.96610.95160.94410.93720.95040.95920.98160.9774
SGAI 1.00441.00170.99350.98610.99611.00691.0371.04961.05891.0513
LVGI 0.92960.91420.90231.02441.00741.00811.01841.01391.00951.0046
TATA -0.0515-0.0407-0.0589-0.0438-0.0568-0.0642-0.0793-0.0808-0.081-0.0713
M-score -2.72-2.50-2.54-2.61-2.74-2.81-2.99-3.05-3.12-3.06
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