Affinity Bancshares (Affinity Bancshares) Beneish M-Score : -3.04 (As of Apr. 30, 2024)

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What is Affinity Bancshares Beneish M-Score?

Note: Financial institutions were excluded from the sample in Beneish paper when calculating Beneish M-Score. Thus, the prediction might not fit banks and insurance companies.

The zones of discrimination for M-Score is as such:

An M-Score of equal or less than -1.78 suggests that the company is unlikely to be a manipulator.
An M-Score of greater than -1.78 signals that the company is likely to be a manipulator.

Good Sign:

Beneish M-Score -3.04 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

The historical rank and industry rank for Affinity Bancshares's Beneish M-Score or its related term are showing as below:

AFBI' s Beneish M-Score Range Over the Past 10 Years
Min: -3.04 Med: -3 Max: -2.99
Current: -3.04

During the past 5 years, the highest Beneish M-Score of Affinity Bancshares was -2.99. The lowest was -3.04. And the median was -3.00.

Affinity Bancshares Beneish M-Score Calculation

The M-score was created by Professor Messod Beneish. Instead of measuring the bankruptcy risk (Altman Z-Score) or business trend (Piotroski 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 Affinity Bancshares for today is based on a combination of the following eight different indices:

-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

0.404 * 0.973

0.892 * 0.9225

0.115 * 0.4541

0.172 * SGAI

4.679 * TATA

0.327 * LVGI

0.172 * 1.0868

4.679 * -0.001688

0.327 * 2.2069

-3.04

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

This Year (Dec23) TTM:

Last Year (Dec22) TTM:

Total Receivables was $0.00 Mil.
Revenue was 7.313 + 7.531 + 7.371 + 7.45 = $29.67 Mil.
Gross Profit was 7.313 + 7.531 + 7.371 + 7.45 = $29.67 Mil.
Total Current Assets was $98.59 Mil.
Total Assets was $843.26 Mil.
Property, Plant and Equipment(Net PPE) was $3.80 Mil.
Depreciation, Depletion and Amortization(DDA) was $0.73 Mil.
Selling, General, & Admin. Expense(SGA) was $12.25 Mil.
Total Current Liabilities was $0.00 Mil.
Long-Term Debt & Capital Lease Obligation was $40.00 Mil.
Net Income was 1.513 + 1.623 + 1.59 + 1.722 = $6.45 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0.00 Mil.
Cash Flow from Operations was 1.809 + 1.729 + 2.334 + 1.999 = $7.87 Mil.

Total Receivables was $0.00 Mil.
Revenue was 7.903 + 8.119 + 7.789 + 8.346 = $32.16 Mil.
Gross Profit was 7.903 + 8.119 + 7.789 + 8.346 = $32.16 Mil.
Total Current Assets was $72.52 Mil.
Total Assets was $791.28 Mil.
Property, Plant and Equipment(Net PPE) was $4.26 Mil.
Depreciation, Depletion and Amortization(DDA) was $0.34 Mil.
Selling, General, & Admin. Expense(SGA) was $12.22 Mil.
Total Current Liabilities was $6.98 Mil.
Long-Term Debt & Capital Lease Obligation was $10.03 Mil.

1. DSRI = Days Sales in Receivables Index

Measured as the ratio of Revenue in Total 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 / 29.665)	/	(0 / 32.157)
	=	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)
	=	(32.157 / 32.157)	/	(29.665 / 29.665)
	=	1	/	1
	=	1

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 Property, Plant and Equipment to Total Assets.

AQI	=	(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t)	/	(1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)
	=	(1 - (98.586 + 3.797) / 843.258)	/	(1 - (72.524 + 4.257) / 791.283)
	=	0.878586	/	0.902966
	=	0.973

4. SGI = Sales Growth Index

Ratio of Revenue 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
	=	29.665	/	32.157
	=	0.9225

5. DEPI = Depreciation Index

Measured as the ratio of the rate of Depreciation, Depletion and Amortization 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))
	=	(0.338 / (0.338 + 4.257))	/	(0.734 / (0.734 + 3.797))
	=	0.073558	/	0.161995
	=	0.4541

Note: If the Depreciation, Depletion and Amortization data is not available, we assume that the depreciation rate is constant and set the Depreciation Index to 1.

6. SGAI = Sales, General and Administrative expenses Index

The ratio of Selling, General, & Admin. Expense(SGA) to Sales 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)
	=	(12.252 / 29.665)	/	(12.22 / 32.157)
	=	0.413012	/	0.380011
	=	1.0868

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 in leverage

LVGI	=	((LTD_t + CurrentLiabilities_t) / TotalAssets_t)	/	((LTD_t-1 + CurrentLiabilities_t-1) / TotalAssets_t-1)
	=	((40 + 0) / 843.258)	/	((10.025 + 6.983) / 791.283)
	=	0.047435	/	0.021494
	=	2.2069

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
	=	(6.448 - 0	-	7.871)	/	843.258
	=	-0.001688

An M-Score of equal or less than -1.78 suggests that the company is unlikely to be a manipulator. An M-Score of greater than -1.78 signals that the company is likely to be a manipulator.

Affinity Bancshares has a M-score of -3.04 suggests that the company is unlikely to be a manipulator.

Affinity Bancshares Beneish M-Score Related Terms

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Affinity Bancshares (Affinity Bancshares) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Financial Services » Banks » Affinity Bancshares Inc (NAS:AFBI) » Definitions » Beneish M-Score

Comparable Companies

Traded in Other Exchanges

N/A

Address

3175 Highway 278, Covington, GA, USA, 30014

Website

https://www.myaffinitybank.com

Affinity Bancshares Inc is a holding company of Affinity Bank, a federally chartered stock savings bank that offers a variety of deposit accounts, including checking accounts, savings accounts, and certificate of deposit accounts. Its business consists of taking deposits from the general public and investing those deposits, together with funds generated from operations, in commercial real estate loans, commercial and industrial loans, and residential real estate loans, construction and land loans, and consumer loans. It also invests in securities, which consist of mortgage-backed securities and obligations issued by United States government-sponsored enterprises and Federal Home Loan Bank stock.

Executives

Howard G Roberts	director	3175 HIGHWAY 278, COVINGTON GA 30014
Robin S Reich	director	3175 HIGHWAY 278, COVINGTON GA 30014
Edward John Cooney	director, officer: CEO	3175 HIGHWAY 278, COVINGTON GA 30014
Robert Vickers	director	3175 HIGHWAY 278, COVINGTON GA 30014
Kenneth R Lehman	10 percent owner	122 N GORDON ROAD, FT LAUDERDALE FL 33301
Clark Nelson	officer: EVP and CCO	3175 HIGHWAY 278, COVINGTON GA 30014
Elizabeth Galazka	officer: EVP-Lending	3175 HIGHWAY 278, COVINGTON GA 30014
Brandi C Pajot	officer: SVP - Chief Financial Officer	3175 HIGHWAY 278, COVINGTON GA 30014
Gregory J. Proffitt	officer: President	3175 HIGHWAY 278, COVINGTON GA 30014
Tessa M. Nolan	officer: SVP and CFO	3175 HIGHWAY 278, COVINGTON GA 30014
Fortson William D. Jr.	director	3175 HIGHWAY 278, COVINGTON GA 30014
Bob W. Richardson	director	3175 HIGHWAY 278, COVINGTON GA 30014
Edward P. Stone	director	3175 HIGHWAY 278, COVINGTON GA 30014
Marshall L. Ginn	director	3175 HIGHWAY 278, COVINGTON GA 30014
Mark J Ross	director	3175 HIGHWAY 278, COVINGTON GA 30014