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Ecit AS (OSL:ECIT) Beneish M-Score : -2.70 (As of May. 15, 2024)


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What is Ecit AS 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.

Good Sign:

Beneish M-Score -2.7 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

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

OSL:ECIT' s Beneish M-Score Range Over the Past 10 Years
Min: -4.16   Med: -2.57   Max: -2.49
Current: -2.7

During the past 6 years, the highest Beneish M-Score of Ecit AS was -2.49. The lowest was -4.16. And the median was -2.57.


Ecit AS Beneish M-Score Historical Data

The historical data trend for Ecit AS'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.

* Premium members only.

Ecit AS Beneish M-Score Chart

Ecit AS Annual Data
Trend Dec18 Dec19 Dec20 Dec21 Dec22 Dec23
Beneish M-Score
Get a 7-Day Free Trial - - -2.67 -2.54 -2.67

Ecit AS Quarterly Data
Dec18 Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22 Sep22 Dec22 Mar23 Jun23 Sep23 Dec23 Mar24
Beneish M-Score Get a 7-Day Free Trial Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only -2.48 -2.50 -2.73 -2.67 -2.70

Competitive Comparison of Ecit AS's Beneish M-Score

For the Information Technology Services subindustry, Ecit AS'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.


Ecit AS's Beneish M-Score Distribution in the Software Industry

For the Software industry and Technology sector, Ecit AS's Beneish M-Score distribution charts can be found below:

* The bar in red indicates where Ecit AS's Beneish M-Score falls into.



Ecit AS 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 Ecit AS 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 * 0.937+0.528 * 1.0026+0.404 * 1.0373+0.892 * 1.1901+0.115 * 1.1389
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1+4.679 * -0.069934-0.327 * 1.0982
=-2.70

* 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 kr707 Mil.
Revenue was 999 + 932 + 766 + 877 = kr3,574 Mil.
Gross Profit was 780 + 765 + 630 + 718 = kr2,893 Mil.
Total Current Assets was kr993 Mil.
Total Assets was kr3,918 Mil.
Property, Plant and Equipment(Net PPE) was kr320 Mil.
Depreciation, Depletion and Amortization(DDA) was kr210 Mil.
Selling, General, & Admin. Expense(SGA) was kr0 Mil.
Total Current Liabilities was kr1,131 Mil.
Long-Term Debt & Capital Lease Obligation was kr785 Mil.
Net Income was 18 + 42 + 18 + 22 = kr100 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = kr0 Mil.
Cash Flow from Operations was 102 + 85 + 103 + 84 = kr374 Mil.
Total Receivables was kr634 Mil.
Revenue was 862 + 792 + 645 + 704 = kr3,003 Mil.
Gross Profit was 701 + 649 + 519 + 568 = kr2,437 Mil.
Total Current Assets was kr906 Mil.
Total Assets was kr3,245 Mil.
Property, Plant and Equipment(Net PPE) was kr259 Mil.
Depreciation, Depletion and Amortization(DDA) was kr213 Mil.
Selling, General, & Admin. Expense(SGA) was kr0 Mil.
Total Current Liabilities was kr979 Mil.
Long-Term Debt & Capital Lease Obligation was kr466 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)
=(707 / 3574) / (634 / 3003)
=0.197818 / 0.211122
=0.937

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)
=(2437 / 3003) / (2893 / 3574)
=0.811522 / 0.809457
=1.0026

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 - (993 + 320) / 3918) / (1 - (906 + 259) / 3245)
=0.66488 / 0.640986
=1.0373

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
=3574 / 3003
=1.1901

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))
=(213 / (213 + 259)) / (210 / (210 + 320))
=0.451271 / 0.396226
=1.1389

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 / 3574) / (0 / 3003)
=0 / 0
=1

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)
=((785 + 1131) / 3918) / ((466 + 979) / 3245)
=0.489025 / 0.4453
=1.0982

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
=(100 - 0 - 374) / 3918
=-0.069934

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.

Ecit AS has a M-score of -2.70 suggests that the company is unlikely to be a manipulator.


Ecit AS Beneish M-Score Related Terms

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Ecit AS (OSL:ECIT) Business Description

Traded in Other Exchanges
Address
Rolfsbuktveien 4A, Fornebu, NOR, 1364
Ecit AS provides services within key business areas of IT, Finance & Accounting and Tech across sectors and industries. The company has a model for acquisition and integration, ensuring proximity to customers and local entrepreneurship combined with the strength of a larger international group. The group's business operations are carried out by three divisions: IT, Finance & Accounting, and Tech. The Finance & Accounting division improves customers' efficiency through delivering administrative services in a productive way along with being a key revenue driver for the company.

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