Australian Enhancedome Fund (ASX:TCF) Beneish M-Score : -2.77 (As of Apr. 25, 2024)

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What is Australian Enhancedome Fund 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 -2.77 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

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

ASX:TCF' s Beneish M-Score Range Over the Past 10 Years
Min: -7.69 Med: -1.73 Max: 9.49
Current: -2.77

During the past 13 years, the highest Beneish M-Score of Australian Enhancedome Fund was 9.49. The lowest was -7.69. And the median was -1.73.

Australian Enhancedome Fund 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 Australian Enhancedome Fund 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 * 1.1986

0.528 * 1

0.404 * 0.4221

0.892 * 1.2514

0.115 * 1

0.172 * SGAI

4.679 * TATA

0.327 * LVGI

0.172 * 1.7687

4.679 * -0.004755

0.327 * 1.9486

-2.77

* 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 (Jun23) TTM:

Last Year (Jun22) TTM:

Total Receivables was A$0.01 Mil.
Revenue was A$1.99 Mil.
Gross Profit was A$1.99 Mil.
Total Current Assets was A$14.42 Mil.
Total Assets was A$24.82 Mil.
Property, Plant and Equipment(Net PPE) was A$0.00 Mil.
Depreciation, Depletion and Amortization(DDA) was A$0.00 Mil.
Selling, General, & Admin. Expense(SGA) was A$0.17 Mil.
Total Current Liabilities was A$0.29 Mil.
Long-Term Debt & Capital Lease Obligation was A$0.00 Mil.
Net Income was A$1.61 Mil.
Gross Profit was A$0.00 Mil.
Cash Flow from Operations was A$1.73 Mil.

Total Receivables was A$0.01 Mil.
Revenue was A$1.59 Mil.
Gross Profit was A$1.59 Mil.
Total Current Assets was A$0.18 Mil.
Total Assets was A$24.68 Mil.
Property, Plant and Equipment(Net PPE) was A$0.00 Mil.
Depreciation, Depletion and Amortization(DDA) was A$0.00 Mil.
Selling, General, & Admin. Expense(SGA) was A$0.08 Mil.
Total Current Liabilities was A$0.15 Mil.
Long-Term Debt & Capital Lease Obligation was A$0.00 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)
	=	(0.009 / 1.986)	/	(0.006 / 1.587)
	=	0.004532	/	0.003781
	=	1.1986

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)
	=	(1.587 / 1.587)	/	(1.986 / 1.986)
	=	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 - (14.417 + 0) / 24.817)	/	(1 - (0.177 + 0) / 24.677)
	=	0.419068	/	0.992827
	=	0.4221

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
	=	1.986	/	1.587
	=	1.2514

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 / (0 + 0))	/	(0 / (0 + 0))
	=		/
	=	1

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)
	=	(0.166 / 1.986)	/	(0.075 / 1.587)
	=	0.083585	/	0.047259
	=	1.7687

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)
	=	((0 + 0.29) / 24.817)	/	((0 + 0.148) / 24.677)
	=	0.011686	/	0.005997
	=	1.9486

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
	=	(1.609 - 0	-	1.727)	/	24.817
	=	-0.004755

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.

Australian Enhancedome Fund has a M-score of -2.77 suggests that the company is unlikely to be a manipulator.

Australian Enhancedome Fund Beneish M-Score Related Terms

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Australian Enhancedome Fund (ASX:TCF) Business Description

Industry

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Comparable Companies

Traded in Other Exchanges

N/A

Address

1 Macquarie Place, Suite 3701, Level 37, Sydney, AUS, 2000

Website

https://www.360capital.com.au

Australian Enhanced Income Fund is an Australia-based company that mainly invests in listed and unlisted debt hybrid securities and cash investments following the Fund Constitution and the Fund Product Disclosure Statements.