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Rolls-Royce Holdings Beneish M-Score

: -2.84 (As of Today)
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The zones of discrimination for M-Score is as such:

An M-Score of less than -2.22 suggests that the company is not an accounting manipulator.
An M-Score of greater than -2.22 signals that the company is likely an accounting manipulator.

Rolls-Royce Holdings has a M-score of -2.81 suggests that the company is not a manipulator.

OTCPK:RYCEF' s Beneish M-Score Range Over the Past 10 Years
Min: -4.95   Med: -2.84   Max: -2.12
Current: -2.84

-4.95
-2.12

During the past 13 years, the highest Beneish M-Score of Rolls-Royce Holdings was -2.12. The lowest was -4.95. And the median was -2.84.


Rolls-Royce Holdings Beneish M-Score Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

* Premium members only.

Rolls-Royce Holdings Annual Data
Dec10 Dec11 Dec12 Dec13 Dec14 Dec15 Dec16 Dec17 Dec18 Dec19
Beneish M-Score Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only -2.66 -3.38 -2.40 -2.69 -2.84

Rolls-Royce Holdings Semi-Annual Data
Jun10 Dec10 Jun11 Dec11 Jun12 Dec12 Jun13 Dec13 Jun14 Dec14 Jun15 Dec15 Jun16 Dec16 Jun17 Dec17 Jun18 Dec18 Jun19 Dec19
Beneish M-Score 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 Premium Member Only Premium Member Only Premium Member Only Premium Member Only -2.40 0.00 -2.69 0.00 -2.84

Competitive Comparison
* 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.


Rolls-Royce Holdings Beneish M-Score Distribution

* The bar in red indicates where Rolls-Royce Holdings's Beneish M-Score falls into.



Rolls-Royce Holdings 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 Rolls-Royce Holdings 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 * 0.898+0.528 * 1.3411+0.404 * 0.9164+0.892 * 1.0919+0.115 * 1.1158
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.6706+4.679 * -0.1119-0.327 * 1.0325
=-2.81

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

This Year (Dec19) TTM:Last Year (Dec18) TTM:
Accounts Receivable was $3,326 Mil.
Revenue was $21,739 Mil.
Gross Profit was $1,235 Mil.
Total Current Assets was $21,064 Mil.
Total Assets was $42,288 Mil.
Property, Plant and Equipment(Net PPE) was $8,928 Mil.
Depreciation, Depletion and Amortization(DDA) was $1,723 Mil.
Selling, General, & Admin. Expense(SGA) was $1,478 Mil.
Total Current Liabilities was $19,647 Mil.
Long-Term Debt & Capital Lease Obligation was $6,435 Mil.
Net Income was $-1,723 Mil.
Gross Profit was $0 Mil.
Cash Flow from Operations was $3,010 Mil.
Accounts Receivable was $3,392 Mil.
Revenue was $19,910 Mil.
Gross Profit was $1,516 Mil.
Total Current Assets was $21,291 Mil.
Total Assets was $40,325 Mil.
Property, Plant and Equipment(Net PPE) was $6,239 Mil.
(DDA) was $1,375 Mil.
Selling, General, & Admin. Expense(SGA) was $2,019 Mil.
Total Current Liabilities was $19,275 Mil.
Long-Term Debt & Capital Lease Obligation was $4,815 Mil.




1. DSRI = Days Sales in Receivables Index

Measured as the ratio of Revenue in Accounts Receivable 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)
=(3326.3433813893 / 21739.187418087) / (3392.4050632911 / 19910.126582278)
=0.15301139 / 0.17038591
=0.898

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)
=(1516.4556962025 / 19910.126582278) / (1234.6002621232 / 21739.187418087)
=0.07616505 / 0.05679146
=1.3411

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 - (21064.220183486 + 8927.9161205767) / 42288.335517693) / (1 - (21291.139240506 + 6239.2405063291) / 40325.316455696)
=0.29077047 / 0.3172929
=0.9164

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
=21739.187418087 / 19910.126582278
=1.0919

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))
=(1374.6835443038 / (1374.6835443038 + 6239.2405063291)) / (1723.4600262123 / (1723.4600262123 + 8927.9161205767))
=0.18054863 / 0.16180632
=1.1158

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)
=(1478.374836173 / 21739.187418087) / (2018.9873417722 / 19910.126582278)
=0.06800506 / 0.10140505
=0.6706

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)
=((6435.124508519 + 19647.44429882) / 42288.335517693) / ((4815.1898734177 + 19274.683544304) / 40325.316455696)
=0.61677927 / 0.59738833
=1.0325

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
=(-1723.4600262123 - 0 - 3010.4849279161) / 42288.335517693
=-0.1119

An M-Score of less than -2.22 suggests that the company will not be a manipulator. An M-Score of greater than -2.22 signals that the company is likely to be a manipulator.

Rolls-Royce Holdings has a M-score of -2.81 suggests that the company will not be a manipulator.


Rolls-Royce Holdings Beneish M-Score Headlines

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