World Acceptance 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 World Acceptance 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 | + | 0.528 * 1 | + | 0.404 * 0.9936 | + | 0.892 * 1.0539 | + | 0.115 * 0.831 |
| - | 0.172 * SGAI | + | 4.679 * TATA | - | 0.327 * LVGI |
| - | 0.172 * 0.8801 | + | 4.679 * -0.257774 | - | 0.327 * 1.0396 |
| = | -3.65 |
* 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 (Dec22) TTM: | Last Year (Dec21) TTM: |
Total Receivables was MXN55 Mil.
Revenue was 2597.5095057048 + 2773.4015645963 + 2929.8788446273 + 3190.2577008799 = MXN11,491 Mil.
Gross Profit was 2597.5095057048 + 2773.4015645963 + 2929.8788446273 + 3190.2577008799 = MXN11,491 Mil.
Total Current Assets was MXN466 Mil.
Total Assets was MXN23,871 Mil.
Property, Plant and Equipment(Net PPE) was MXN2,115 Mil.
Depreciation, Depletion and Amortization(DDA) was MXN223 Mil.
Selling, General, & Admin. Expense(SGA) was MXN4,575 Mil.
Total Current Liabilities was MXN957 Mil.
Long-Term Debt & Capital Lease Obligation was MXN15,860 Mil.
Net Income was 112.96163323935 + -27.414117380194 + -176.14891045796 + 377.64716109355 = MXN287 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = MXN0 Mil.
Cash Flow from Operations was 1357.6579972729 + 1575.0072708621 + 1164.1275887439 + 2343.5202542217 = MXN6,440 Mil.
|
Total Receivables was MXN0 Mil.
Revenue was 2896.283953599 + 2628.304311425 + 2487.0585587991 + 2891.3049990603 = MXN10,903 Mil.
Gross Profit was 2896.283953599 + 2628.304311425 + 2487.0585587991 + 2891.3049990603 = MXN10,903 Mil.
Total Current Assets was MXN391 Mil.
Total Assets was MXN26,580 Mil.
Property, Plant and Equipment(Net PPE) was MXN2,330 Mil.
Depreciation, Depletion and Amortization(DDA) was MXN201 Mil.
Selling, General, & Admin. Expense(SGA) was MXN4,932 Mil.
Total Current Liabilities was MXN1,102 Mil.
Long-Term Debt & Capital Lease Obligation was MXN16,911 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) |
| = | (54.725292019062 / 11491.047615808) | / | (0 / 10902.951822883) |
| = | 0.004762 | / | 0 |
| | = | 1 |
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) |
| = | (10902.951822883 / 10902.951822883) | / | (11491.047615808 / 11491.047615808) |
| = | 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 - (465.89072976228 + 2114.7696627366) / 23870.780082715) | / | (1 - (390.64656767615 + 2329.8171340686) / 26580.309807965) |
| = | 0.89189 | / | 0.897651 |
| | = | 0.9936 |
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 |
| = | 11491.047615808 | / | 10902.951822883 |
| | = | 1.0539 |
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)) |
| = | (200.59241400559 / (200.59241400559 + 2329.8171340686)) | / | (223.01968997511 / (223.01968997511 + 2114.7696627366)) |
| = | 0.079273 | / | 0.095398 |
| | = | 0.831 |
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) |
| = | (4574.5516668515 / 11491.047615808) | / | (4931.7786477917 / 10902.951822883) |
| = | 0.398097 | / | 0.452334 |
| | = | 0.8801 |
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) |
| = | ((15859.566160324 + 957.22185513342) / 23870.780082715) | / | ((16911.137625981 + 1101.9213070865) / 26580.309807965) |
| = | 0.704493 | / | 0.677684 |
| | = | 1.0396 |
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 |
| = | (287.04576649475 - 0 | - | 6440.3131111006) | / | 23870.780082715 |
| | = | -0.257774 |
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.
World Acceptance has a M-score of -3.65 suggests that the company is unlikely to be a manipulator.
Create New Portfolio
Portfolio Contest
Personalize
Premium Gurus 
(0%) Oct. 20
Email Alerts
Stock PDF
RSS
Website
Filings
Download
Manual of Stocks™ Web APP
MEX:WRLD has been successfully added to your 