Effect Real Estate Company (KUW:EFFECT) Beneish M-Score : 0.00 (As of Apr. 26, 2024)

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What is Effect Real Estate Company Beneish M-Score?

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.

The historical rank and industry rank for Effect Real Estate Company's Beneish M-Score or its related term are showing as below:

During the past 9 years, the highest Beneish M-Score of Effect Real Estate Company was 0.00. The lowest was 0.00. And the median was 0.00.

Effect Real Estate Company Beneish M-Score Historical Data

The historical data trend for Effect Real Estate Company's Beneish M-Score can be seen below:

* 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.

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Effect Real Estate Company Beneish M-Score Chart

Effect Real Estate Company Annual Data

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Jan17

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Jan19

Beneish M-Score

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Effect Real Estate Company Quarterly Data
	Mar12	Jun12	Oct16	Jan17	Apr17	Jul17	Oct17	Jan18	Apr18	Jul18	Oct18	Jan19	Apr19
Beneish M-Score	Get a 7-Day Free Trial								-	-	-	-	-

Competitive Comparison of Effect Real Estate Company's Beneish M-Score

For the Real Estate - Development subindustry, Effect Real Estate Company's Beneish M-Score, along with its competitors' market caps and Beneish M-Score data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

Effect Real Estate Company's Beneish M-Score Distribution in the Real Estate Industry

For the Real Estate industry and Real Estate sector, Effect Real Estate Company's Beneish M-Score distribution charts can be found below:

* The bar in red indicates where Effect Real Estate Company's Beneish M-Score falls into.

Effect Real Estate Company 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 Effect Real Estate Company 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 * 1.3429

0.528 * 1.0763

0.404 * 0.5098

0.892 * 0.9738

0.115 * 1

0.172 * SGAI

4.679 * TATA

0.327 * LVGI

0.172 * 1.0072

4.679 * 0.128092

0.327 * 0.9398

-1.73

This Year (Apr19) TTM:

Last Year (Apr18) TTM:

Total Receivables was KWD0.05 Mil.
Revenue was 0.056 + 0.056 + 0.056 + 0.055 = KWD0.22 Mil.
Gross Profit was 0.051 + 0.044 + 0.048 + 0.047 = KWD0.19 Mil.
Total Current Assets was KWD1.34 Mil.
Total Assets was KWD6.14 Mil.
Property, Plant and Equipment(Net PPE) was KWD2.28 Mil.
Depreciation, Depletion and Amortization(DDA) was KWD0.00 Mil.
Selling, General, & Admin. Expense(SGA) was KWD0.05 Mil.
Total Current Liabilities was KWD0.15 Mil.
Long-Term Debt & Capital Lease Obligation was KWD0.00 Mil.
Net Income was 0.105 + -0.188 + -0.061 + 0.066 = KWD-0.08 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = KWD0.00 Mil.
Cash Flow from Operations was 0.102 + -0.045 + -0.568 + -0.354 = KWD-0.87 Mil.

Total Receivables was KWD0.04 Mil.
Revenue was 0.057 + 0.057 + 0.057 + 0.058 = KWD0.23 Mil.
Gross Profit was 0.051 + 0.046 + 0.051 + 0.062 = KWD0.21 Mil.
Total Current Assets was KWD1.21 Mil.
Total Assets was KWD6.23 Mil.
Property, Plant and Equipment(Net PPE) was KWD0.00 Mil.
Depreciation, Depletion and Amortization(DDA) was KWD0.00 Mil.
Selling, General, & Admin. Expense(SGA) was KWD0.05 Mil.
Total Current Liabilities was KWD0.16 Mil.
Long-Term Debt & Capital Lease Obligation was KWD0.00 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)
	=	(0.051 / 0.223)	/	(0.039 / 0.229)
	=	0.2287	/	0.170306
	=	1.3429

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)
	=	(0.21 / 0.229)	/	(0.19 / 0.223)
	=	0.917031	/	0.852018
	=	1.0763

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 - (1.338 + 2.28) / 6.144)	/	(1 - (1.206 + 0) / 6.23)
	=	0.411133	/	0.806421
	=	0.5098

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
	=	0.223	/	0.229
	=	0.9738

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 + 2.28))
	=		/	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)
	=	(0.051 / 0.223)	/	(0.052 / 0.229)
	=	0.2287	/	0.227074
	=	1.0072

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 + 0.152) / 6.144)	/	((0 + 0.164) / 6.23)
	=	0.02474	/	0.026324
	=	0.9398

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
	=	(-0.078 - 0	-	-0.865)	/	6.144
	=	0.128092

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.

Effect Real Estate Company has a M-score of -1.73 signals that the company is likely to be a manipulator.

Effect Real Estate Company Beneish M-Score Related Terms

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Effect Real Estate Company (KUW:EFFECT) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Real Estate » Real Estate » Effect Real Estate Company (KUW:EFFECT) » Definitions » Beneish M-Score

Comparable Companies

Traded in Other Exchanges

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Address

Beirut Street, Al-Safat Group Headquarters. P.O. Box 20153, Opposite Sultan Center, Safat, Hawalli, KWT, 13062

Website

http://www.effectrealestate.com

Effect Real Estate Company operates as a real estate development company in Kuwait. The company engages in owning, buying, selling and developing and managing real estate. Its activities include owning, purchasing and selling real estate properties and lands, and developing same in favor of the company inside and outside of the State of Kuwait. The operating segments of the group are Real estate and Investment management.

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