Atlas Financial Holdings (Atlas Financial Holdings) Beneish M-Score : -5.26 (As of Jun. 24, 2024)

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What is Atlas Financial Holdings 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 -5.26 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

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

AFHBQ.PFD' s Beneish M-Score Range Over the Past 10 Years
Min: -5.26 Med: -2.58 Max: 2.68
Current: -5.26

During the past 13 years, the highest Beneish M-Score of Atlas Financial Holdings was 2.68. The lowest was -5.26. And the median was -2.58.

Atlas Financial Holdings 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 Atlas Financial Holdings 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 * 0.7622

0.528 * 1

0.404 * 0.9646

0.892 * 0.3335

0.115 * 0.8778

0.172 * SGAI

4.679 * TATA

0.327 * LVGI

0.172 * 2.1015

4.679 * -0.240932

0.327 * 4.7471

-5.86

* 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 (Sep22) TTM:

Last Year (Sep21) TTM:

Total Receivables was $8.75 Mil.
Revenue was 1.07 + 0.999 + 1.586 + -0.525 = $3.13 Mil.
Gross Profit was 1.07 + 0.999 + 1.586 + -0.525 = $3.13 Mil.
Total Current Assets was $0.00 Mil.
Total Assets was $21.45 Mil.
Property, Plant and Equipment(Net PPE) was $1.47 Mil.
Depreciation, Depletion and Amortization(DDA) was $1.22 Mil.
Selling, General, & Admin. Expense(SGA) was $2.24 Mil.
Total Current Liabilities was $0.00 Mil.
Long-Term Debt & Capital Lease Obligation was $36.12 Mil.
Net Income was -3.746 + -5.03 + -4.151 + 0.279 = $-12.65 Mil.
Non Operating Income was 0.31 + 0.36 + 0.752 + 3.094 = $4.52 Mil.
Cash Flow from Operations was -2.765 + -4.943 + -5.057 + 0.769 = $-12.00 Mil.

Total Receivables was $34.41 Mil.
Revenue was 1.783 + 1.239 + 2.341 + 4.021 = $9.38 Mil.
Gross Profit was 1.783 + 1.239 + 2.341 + 4.021 = $9.38 Mil.
Total Current Assets was $0.00 Mil.
Total Assets was $95.45 Mil.
Property, Plant and Equipment(Net PPE) was $3.29 Mil.
Depreciation, Depletion and Amortization(DDA) was $2.17 Mil.
Selling, General, & Admin. Expense(SGA) was $3.20 Mil.
Total Current Liabilities was $0.00 Mil.
Long-Term Debt & Capital Lease Obligation was $33.85 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)
	=	(8.748 / 3.13)	/	(34.412 / 9.384)
	=	2.794888	/	3.667093
	=	0.7622

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)
	=	(9.384 / 9.384)	/	(3.13 / 3.13)
	=	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 - (0 + 1.473) / 21.45)	/	(1 - (0 + 3.289) / 95.448)
	=	0.931329	/	0.965541
	=	0.9646

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
	=	3.13	/	9.384
	=	0.3335

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))
	=	(2.165 / (2.165 + 3.289))	/	(1.216 / (1.216 + 1.473))
	=	0.396956	/	0.452213
	=	0.8778

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)
	=	(2.243 / 3.13)	/	(3.2 / 9.384)
	=	0.716613	/	0.341006
	=	2.1015

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)
	=	((36.116 + 0) / 21.45)	/	((33.854 + 0) / 95.448)
	=	1.68373	/	0.354685
	=	4.7471

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
	=	(-12.648 - 4.516	-	-11.996)	/	21.45
	=	-0.240932

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.

Atlas Financial Holdings has a M-score of -5.86 suggests that the company is unlikely to be a manipulator.

Atlas Financial Holdings Beneish M-Score Related Terms

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Atlas Financial Holdings (Atlas Financial Holdings) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Financial Services » Insurance » Atlas Financial Holdings Inc (OTCPK:AFHBQ.PFD) » Definitions » Beneish M-Score

Comparable Companies

Traded in Other Exchanges

N/A

Address

953 American Lane, 3rd Floor, Schaumburg, Chicago, IL, USA, 60173

Website

https://www.atlas-fin.com

Atlas Financial Holdings Inc is engaged in the business of underwriting commercial automobile insurance in the United States. It focuses on the light commercial automobile sector, which includes taxi cabs, non-emergency para-transit, limousine, livery, and business auto. Its automobile insurance products provide insurance coverage in three major areas: liability, accident benefits, and physical damage. The company distributes its insurance products through a network of retail independent agents.

Executives

Steven D Scheiwe	director	1741 EDGEFIELD LANE, ENCINITAS CA 92024
Mark E Holliday	director	257 SW MARCONI AVENUE, PORTLAND OR 97201
American Financial Group Inc	10 percent owner	GREAT AMERICAN INSURANCE GROUP TOWER, 301 E. 4TH STREET, CINCINNATI OH 45202
Ronald Konezny	director	C/O DIGI INTERNATIONAL INC., 9350 EXCELSIOR BLVD, SUITE 700, HOPKINS MN 55343
Walter Frederick Walker	director	14419 GREENWOOD AVE. N, STE A 418, SEATTLE WA 98133
Ellbar Partners Management, Llc	10 percent owner	15 E 5TH STREET-SUITE 3200, TULSA OK 74103
Stephen J Heyman	10 percent owner	15 EAST 5TH STREET, SUITE 3200, TULSA OK 74103
James F Adelson	10 percent owner	15 EAST 5TH STREET, SUITE 3200, TULSA OK 74103
Magnolia Capital Partners, Llc	10 percent owner	15 E. 5TH STREET, SUITE 3200, TULSA OK 74103
Fitzgerald John Taylor Maloney	director	KINGSWAY FINANCIAL SERVICES INC., 150 PIERCE ROAD, SUITE 600, ITASCA IL 60143
Swets Larry G Jr	director	105 S. MAPLE ST., ITASCA IL 60143
Kingsway America Inc	10 percent owner	150 PIERCE ROAD, SUITE 600, ITASCA IL 60143
Jordan Kupinsky	director	395 BROOKE AVENUE, TORONTO A6 M5M2L5
Gordon G Pratt	director, officer: Chairman of the Board	1101 BRICKELL AVENUE, SOUTH TOWER, 8TH FLOOR, MIAMI FL 33131
Leslie Dimaggio	other: Subsidiary Director/Vice Pres	715 BARBERRY TRAIL, FOX RIVER GROVE IL 60021