Tri-Continental 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 Tri-Continental 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 (Dec23) TTM: | Last Year (Dec22) TTM: |
Total Receivables was $17.8 Mil.
Revenue was $253.9 Mil.
Gross Profit was $253.9 Mil.
Total Current Assets was $17.8 Mil.
Total Assets was $1,753.2 Mil.
Property, Plant and Equipment(Net PPE) was $0.0 Mil.
Depreciation, Depletion and Amortization(DDA) was $0.0 Mil.
Selling, General, & Admin. Expense(SGA) was $0.4 Mil.
Total Current Liabilities was $4.1 Mil.
Long-Term Debt & Capital Lease Obligation was $0.0 Mil.
Net Income was $253.1 Mil.
Gross Profit was $0.0 Mil.
Cash Flow from Operations was $0.0 Mil.
|
Total Receivables was $9.7 Mil.
Revenue was $-291.4 Mil.
Gross Profit was $-291.4 Mil.
Total Current Assets was $9.7 Mil.
Total Assets was $1,616.5 Mil.
Property, Plant and Equipment(Net PPE) was $0.0 Mil.
Depreciation, Depletion and Amortization(DDA) was $0.0 Mil.
Selling, General, & Admin. Expense(SGA) was $0.4 Mil.
Total Current Liabilities was $1.8 Mil.
Long-Term Debt & Capital Lease Obligation was $0.0 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) |
| = | (17.844 / 253.908) | / | (9.747 / -291.387) |
| = | 0.070277 | / | |
| | = | |
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) |
| = | (-291.387 / -291.387) | / | (253.908 / 253.908) |
| = | | / | 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 - (17.844 + 0) / 1753.15) | / | (1 - (9.747 + 0) / 1616.451) |
| = | 0.989822 | / | 0.99397 |
| | = | |
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 |
| = | 253.908 | / | -291.387 |
| | = | |
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 + 0)) |
| = | | / | |
| | = | |
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) |
| = | (0.413 / 253.908) | / | (0.402 / -291.387) |
| = | 0.001627 | / | |
| | = | |
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 + 4.143) / 1753.15) | / | ((0 + 1.781) / 1616.451) |
| = | 0.002363 | / | 0.001102 |
| | = | |
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 |
| = | (253.081 - 0 | - | 0) | / | 1753.15 |
| | = | 0.144358 |
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.
Tri-Continental (Tri-Continental) Business Description
Traded in Other Exchanges
Address
290 Congress Street, Boston, MA, USA, 02110
Tri-Continental Corp is a United States-based closed-end management investment company. It invests to produce future growth of both capital and income while providing reasonable current income. The fund is divided into two equal segments namely, the equity segment uses quantitative models to select individual stocks whereas the Flexible capital income segment invests across a company's investable capital structure, including stocks, bonds, and convertible securities. The Fund invests in a range of sectors, which include consumer discretionary, consumer staples, energy, financials, healthcare, industrials, information technology, industrials, materials, real estate, telecommunication services, utilities, aerospace and defense, banking, chemicals, and others.
Executives
| Janet Carrig |
director |
ONE SOUTH WACKER DRIVE SUITE 3200, CHICAGO IL 60606 |
| Raghavendran Sivaraman |
other: Portfolio Manager of Issuer |
225 FRANKLIN STREET, BOSTON MA 02110 |
| Douglas A Hacker |
director |
P O BOX 66100-WHQLD, CHICAGO IL 60666 |
| Oleg Nusinzon |
other: Portfolio Manager of Issuer |
225 FRANKLIN ST, BOSTON MA 02110 |
| Gene R Tannuzzo |
other: Man Dir/GL HD of FI Issuer IA |
225 FRANKLIN ST., BOSTON MA 02110 |
| Christopher O. Petersen |
officer: Vice President and Secretary |
5228 AMERIPRISE FINANCIAL CENTER, MINNEAPOLIS MN 55474 |
| Grace Lee |
other: Portfolio Manager of Issuer |
225 FRANKLIN STREET, BOSTON MA 02110 |
| Brian M. Engelking |
other: Dir., VP & CFO of Issuer's IA |
225 FRANKLIN STREET, BOSTON MA 02110 |
| Sandra Yeager |
director |
225 FRANKLIN ST., BOSTON MA 02110 |
| Jonathan C Cleasby |
other: Dir., VP & CFO of Issuer's IA |
225 FRANKLIN ST., BOSTON MA 02110 |
| David L King |
other: Portfolio Manager of Issuer |
C/O PUTNAM LLC, ONE POST OFFICE SQUARE L5, BOSTON MA 02109 |
| Pamela G Carlton |
director |
901 S. MARQUETTE AVENUE, MINNEAPOLIS MN 55402 |
| Daniel Beckman |
officer: Senior Vice President |
225 FRANKLIN STREET, BOSTON MA 02110 |
| Brian J Gallagher |
director |
225 FRANKLIN STREET, BOSTON MA 02110 |
| Anthony M Santomero |
director |
RENAISSANCE HOUSE, 8-20 EAST BROADWAY, PEMBROKE D0 HM 19 |
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