ICC Holdings (FRA:4EH) Beneish M-Score : -2.49 (As of May. 27, 2024)

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What is ICC 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 -2.49 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

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

FRA:4EH' s Beneish M-Score Range Over the Past 10 Years
Min: -3.44 Med: -2.5 Max: -2.23
Current: -2.49

During the past 10 years, the highest Beneish M-Score of ICC Holdings was -2.23. The lowest was -3.44. And the median was -2.50.

ICC 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 ICC 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 * 0.9358

0.528 * 1

0.404 * 1.0014

0.892 * 1.1371

0.115 * 0.9355

0.172 * SGAI

4.679 * TATA

0.327 * LVGI

0.172 * 0.8595

4.679 * -0.03055

0.327 * 0.914

-2.51

* 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 (Mar24) TTM:

Last Year (Mar23) TTM:

Total Receivables was €48.37 Mil.
Revenue was 21.235 + 21.006 + 18.519 + 19.061 = €79.82 Mil.
Gross Profit was 21.235 + 21.006 + 18.519 + 19.061 = €79.82 Mil.
Total Current Assets was €0.00 Mil.
Total Assets was €199.12 Mil.
Property, Plant and Equipment(Net PPE) was €3.10 Mil.
Depreciation, Depletion and Amortization(DDA) was €0.73 Mil.
Selling, General, & Admin. Expense(SGA) was €0.73 Mil.
Total Current Liabilities was €0.00 Mil.
Long-Term Debt & Capital Lease Obligation was €13.80 Mil.
Net Income was 2.06 + 2.624 + -0.721 + 0.541 = €4.50 Mil.
Non Operating Income was -0.005 + 0.07 + 0.048 + 0.059 = €0.17 Mil.
Cash Flow from Operations was 4.66 + -1.928 + 2.647 + 5.036 = €10.42 Mil.

Total Receivables was €45.45 Mil.
Revenue was 18.325 + 19.9 + 17.972 + 13.998 = €70.20 Mil.
Gross Profit was 18.325 + 19.9 + 17.972 + 13.998 = €70.20 Mil.
Total Current Assets was €0.00 Mil.
Total Assets was €184.75 Mil.
Property, Plant and Equipment(Net PPE) was €3.12 Mil.
Depreciation, Depletion and Amortization(DDA) was €0.68 Mil.
Selling, General, & Admin. Expense(SGA) was €0.75 Mil.
Total Current Liabilities was €0.00 Mil.
Long-Term Debt & Capital Lease Obligation was €14.01 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)
	=	(48.37 / 79.821)	/	(45.454 / 70.195)
	=	0.605981	/	0.647539
	=	0.9358

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)
	=	(70.195 / 70.195)	/	(79.821 / 79.821)
	=	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 + 3.095) / 199.118)	/	(1 - (0 + 3.124) / 184.752)
	=	0.984456	/	0.983091
	=	1.0014

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
	=	79.821	/	70.195
	=	1.1371

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))
	=	(0.679 / (0.679 + 3.124))	/	(0.73 / (0.73 + 3.095))
	=	0.178543	/	0.19085
	=	0.9355

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)
	=	(0.732 / 79.821)	/	(0.749 / 70.195)
	=	0.009171	/	0.01067
	=	0.8595

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)
	=	((13.8 + 0) / 199.118)	/	((14.01 + 0) / 184.752)
	=	0.069306	/	0.075831
	=	0.914

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
	=	(4.504 - 0.172	-	10.415)	/	199.118
	=	-0.03055

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.

ICC Holdings has a M-score of -2.51 suggests that the company is unlikely to be a manipulator.

ICC Holdings Beneish M-Score Related Terms

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ICC Holdings (FRA:4EH) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Financial Services » Insurance » ICC Holdings Inc (FRA:4EH) » Definitions » Beneish M-Score

Comparable Companies

Traded in Other Exchanges

ICCH:USA

Address

225 20th Street, Rock Island, IL, USA, 61201

Website

https://ir.iccholdingsinc.com

ICC Holdings Inc is a specialty insurance carrier primarily underwriting commercial multi-peril, liquor liability, worker's compensation, and umbrella liability coverages for the food and beverage industry. The company markets its products through a network of independent agents in Colorado, Illinois, Indiana, Iowa, Kansas, Minnesota, Missouri, Pennsylvania, Ohio, and Wisconsin.