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GuruFocus has detected 3 Warning Signs with Yamana Gold Inc $AUY.
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Yamana Gold Inc (NYSE:AUY)
Beneish M-Score
-1.76 (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.

Yamana Gold Inc has a M-score of -1.83 signals that the company is a manipulator.

AUY' s Beneish M-Score Range Over the Past 10 Years
Min: -10000000   Max: 523.87
Current: -1.76

-10000000
523.87

During the past 13 years, the highest Beneish M-Score of Yamana Gold Inc was 523.87. The lowest was -10000000.00. And the median was -2.55.


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 Yamana Gold 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 * 1.0653+0.528 * 2.988+0.404 * 0.927+0.892 * 1.04+0.115 * 0.9829
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9329+4.679 * -0.0999-0.327 * 1.0299
=-1.83

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

This Year (Mar17) TTM:Last Year (Mar16) TTM:
Accounts Receivable was $31 Mil.
Revenue was 403.5 + 484.4 + 464.3 + 466.5 = $1,819 Mil.
Gross Profit was 59.5 + -639.3 + 91 + 63.7 = $-425 Mil.
Total Current Assets was $613 Mil.
Total Assets was $8,850 Mil.
Property, Plant and Equipment(Net PPE) was $7,596 Mil.
Depreciation, Depletion and Amortization(DDA) was $466 Mil.
Selling, General & Admin. Expense(SGA) was $104 Mil.
Total Current Liabilities was $533 Mil.
Long-Term Debt was $1,595 Mil.
Net Income was -6.1 + -367.2 + -11.8 + 34.8 = $-350 Mil.
Non Operating Income was -20.3 + -10 + -20.2 + -9.1 = $-60 Mil.
Cash Flow from Operations was 51.3 + 163.8 + 176.4 + 201.9 = $593 Mil.
Accounts Receivable was $28 Mil.
Revenue was 430.3 + 439.1 + 424.4 + 455 = $1,749 Mil.
Gross Profit was 90 + -1419.7 + 52.1 + 56.2 = $-1,221 Mil.
Total Current Assets was $637 Mil.
Total Assets was $9,584 Mil.
Property, Plant and Equipment(Net PPE) was $8,198 Mil.
Depreciation, Depletion and Amortization(DDA) was $494 Mil.
Selling, General & Admin. Expense(SGA) was $107 Mil.
Total Current Liabilities was $505 Mil.
Long-Term Debt was $1,733 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)
=(30.8 / 1818.7) / (27.8 / 1748.8)
=0.01693517 / 0.01589661
=1.0653

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)
=(-1221.4 / 1748.8) / (-425.1 / 1818.7)
=-0.69842177 / -0.23373838
=2.988

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 - (613.3 + 7596) / 8850.4) / (1 - (637.1 + 8198) / 9584)
=0.0724374 / 0.07814065
=0.927

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
=1818.7 / 1748.8
=1.04

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))
=(493.5 / (493.5 + 8198)) / (465.7 / (465.7 + 7596))
=0.05677961 / 0.05776697
=0.9829

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)
=(104.2 / 1818.7) / (107.4 / 1748.8)
=0.05729367 / 0.06141354
=0.9329

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)
=((1595 + 532.9) / 8850.4) / ((1732.6 + 504.7) / 9584)
=0.24042981 / 0.23344115
=1.0299

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
=(-350.3 - -59.6 - 593.4) / 8850.4
=-0.0999

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.

Yamana Gold Inc has a M-score of -1.83 signals that the company is likely to 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.

Yamana Gold Inc Annual Data

Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15Dec16
DSRI 0.61160.2463.10971.48910.73650.80890.57050.60690.930.795
GMI 0.6651.77580.93170.9170.74641.13191.6351.8843-0.21733.352
AQI 0.3830.99962.20591.1590.75720.87210.74641.64611.11061.1184
SGI 4.41531.34181.18041.42551.28841.07520.78860.99580.96821.0388
DEPI 2.22710.39430.74290.80270.8921.05470.95690.85430.7341.0316
SGAI 0.23960.64451.38260.78160.86511.11761.16830.91470.95270.8586
LVGI 1.89790.87251.01020.94741.00751.41371.31661.38051.05470.9986
TATA -0.0054-0.015-0.038-0.0175-0.0511-0.0593-0.0966-0.1541-0.2751-0.1029
M-score -0.26-2.50-0.20-1.68-2.93-3.00-3.42-2.97-4.50-1.80

Yamana Gold Inc Quarterly Data

Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16Dec16Mar17
DSRI 0.60690.57460.38350.930.61530.52230.7951.0653
GMI 1.88431.46821.2579-0.2173-0.2147-0.19073.3522.988
AQI 1.64611.66980.94441.11061.39041.47111.11840.927
SGI 0.99581.1671.09790.96820.90180.95731.03881.04
DEPI 0.85430.8470.88040.7340.80940.83731.03160.9829
SGAI 0.91470.78420.8420.95271.00760.91290.85860.9329
LVGI 1.38051.21880.95531.05471.16661.14910.99861.0299
TATA -0.1541-0.164-0.0865-0.2751-0.2606-0.26-0.1029-0.0999
M-score -2.97-3.02-3.22-4.50-4.70-4.66-1.80-1.83
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