Qualitas ControladoraB de CV 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 Qualitas ControladoraB de CV 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 * | + | 0.528 * | + | 0.404 * | + | 0.892 * | + | 0.115 * |
| - | 0.172 * SGAI | + | 4.679 * TATA | - | 0.327 * LVGI |
| - | 0.172 * | + | 4.679 * | - | 0.327 * |
| = | |
* 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 (Dec24) TTM: | Last Year (Dec23) TTM: |
Total Receivables was MXN41,914 Mil.
Revenue was 22278.82 + 17138.242 + 16362.717 + 17690.517 = MXN73,470 Mil.
Gross Profit was 22278.82 + 17138.242 + 16362.717 + 17690.517 = MXN73,470 Mil.
Total Current Assets was MXN0 Mil.
Total Assets was MXN107,900 Mil.
Property, Plant and Equipment(Net PPE) was MXN1,483 Mil.
Depreciation, Depletion and Amortization(DDA) was MXN508 Mil.
Selling, General, & Admin. Expense(SGA) was MXN246 Mil.
Total Current Liabilities was MXN0 Mil.
Long-Term Debt & Capital Lease Obligation was MXN0 Mil.
Net Income was 1356.582 + 1145.135 + 1379.725 + 1234.155 = MXN5,116 Mil.
Non Operating Income was 57.419 + 21.112 + 40.885 + -17.739 = MXN102 Mil.
Cash Flow from Operations was 2536.294 + 202.958 + 1310.037 + -900.809 = MXN3,148 Mil.
|
Total Receivables was MXN32,341 Mil.
Revenue was 17369.799 + 13934.663 + 12715.307 + 13048.534 = MXN57,068 Mil.
Gross Profit was 17369.799 + 13934.663 + 12715.307 + 13048.534 = MXN57,068 Mil.
Total Current Assets was MXN0 Mil.
Total Assets was MXN87,688 Mil.
Property, Plant and Equipment(Net PPE) was MXN1,167 Mil.
Depreciation, Depletion and Amortization(DDA) was MXN527 Mil.
Selling, General, & Admin. Expense(SGA) was MXN-542 Mil.
Total Current Liabilities was MXN0 Mil.
Long-Term Debt & Capital Lease Obligation was MXN0 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) |
| = | (41914.289 / 73470.296) | / | (32341.304 / 57068.303) |
| = | 0.570493 | / | 0.566712 |
| | = | |
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) |
| = | (57068.303 / 57068.303) | / | (73470.296 / 73470.296) |
| = | 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 + 1482.668) / 107899.633) | / | (1 - (0 + 1167.041) / 87688.198) |
| = | 0.986259 | / | 0.986691 |
| | = | |
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 |
| = | 73470.296 | / | 57068.303 |
| | = | |
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)) |
| = | (527.381 / (527.381 + 1167.041)) | / | (508.02 / (508.02 + 1482.668)) |
| = | 0.311245 | / | 0.255198 |
| | = | |
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) |
| = | (246.097 / 73470.296) | / | (-542.037 / 57068.303) |
| = | 0.00335 | / | -0.009498 |
| | = | |
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) / 107899.633) | / | ((0 + 0) / 87688.198) |
| = | 0 | / | 0 |
| | = | |
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 |
| = | (5115.597 - 101.677 | - | 3148.48) | / | 107899.633 |
| | = | 0.017289 |
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.
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