GURUFOCUS.COM » STOCK LIST » Financial Services » Banks » Hua Nan Financial Holdings Co Ltd (TPE:2880) » Definitions » Beneish M-Score

Hua Nan Financial Holdings Co (TPE:2880) Beneish M-Score : -2.33 (As of Mar. 16, 2025)


View and export this data going back to 2001. Start your Free Trial

What is Hua Nan Financial Holdings Co Beneish M-Score?

Note: Financial institutions were excluded from the sample in Beneish paper when calculating Beneish M-Score. Thus, the prediction might not fit banks and insurance companies.

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 -2.33 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

The historical rank and industry rank for Hua Nan Financial Holdings Co's Beneish M-Score or its related term are showing as below:

TPE:2880' s Beneish M-Score Range Over the Past 10 Years
Min: -2.69   Med: -2.43   Max: -2.14
Current: -2.33

During the past 13 years, the highest Beneish M-Score of Hua Nan Financial Holdings Co was -2.14. The lowest was -2.69. And the median was -2.43.


Hua Nan Financial Holdings Co 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 Hua Nan Financial Holdings Co 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 * 1.0004+0.892 * 1.1604+0.115 * 1.0393
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0011+4.679 * -0.00339-0.327 * 0.9445
=-2.33

* 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 (Sep24) TTM:Last Year (Sep23) TTM:
Total Receivables was NT$0 Mil.
Revenue was 18021.013 + 16670.141 + 16274.001 + 14793.062 = NT$65,758 Mil.
Gross Profit was 18021.013 + 16670.141 + 16274.001 + 14793.062 = NT$65,758 Mil.
Total Current Assets was NT$0 Mil.
Total Assets was NT$4,193,357 Mil.
Property, Plant and Equipment(Net PPE) was NT$35,967 Mil.
Depreciation, Depletion and Amortization(DDA) was NT$2,116 Mil.
Selling, General, & Admin. Expense(SGA) was NT$10,472 Mil.
Total Current Liabilities was NT$0 Mil.
Long-Term Debt & Capital Lease Obligation was NT$125,022 Mil.
Net Income was 6640.325 + 5585.567 + 5628.913 + 4726.424 = NT$22,581 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = NT$0 Mil.
Cash Flow from Operations was 59463.105 + -41161.599 + 13764.761 + 4728.651 = NT$36,795 Mil.
Total Receivables was NT$0 Mil.
Revenue was 15722.861 + 14886.867 + 14228.342 + 11831.801 = NT$56,670 Mil.
Gross Profit was 15722.861 + 14886.867 + 14228.342 + 11831.801 = NT$56,670 Mil.
Total Current Assets was NT$0 Mil.
Total Assets was NT$3,795,188 Mil.
Property, Plant and Equipment(Net PPE) was NT$33,977 Mil.
Depreciation, Depletion and Amortization(DDA) was NT$2,082 Mil.
Selling, General, & Admin. Expense(SGA) was NT$9,015 Mil.
Total Current Liabilities was NT$0 Mil.
Long-Term Debt & Capital Lease Obligation was NT$119,803 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)
=(0 / 65758.217) / (0 / 56669.871)
=0 / 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)
=(56669.871 / 56669.871) / (65758.217 / 65758.217)
=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 - (0 + 35967.476) / 4193357.391) / (1 - (0 + 33976.526) / 3795187.728)
=0.991423 / 0.991047
=1.0004

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
=65758.217 / 56669.871
=1.1604

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))
=(2082.106 / (2082.106 + 33976.526)) / (2115.742 / (2115.742 + 35967.476))
=0.057742 / 0.055556
=1.0393

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)
=(10472.042 / 65758.217) / (9014.559 / 56669.871)
=0.159251 / 0.159071
=1.0011

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)
=((125021.894 + 0) / 4193357.391) / ((119803.423 + 0) / 3795187.728)
=0.029814 / 0.031567
=0.9445

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
=(22581.229 - 0 - 36794.918) / 4193357.391
=-0.00339

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.

Hua Nan Financial Holdings Co has a M-score of -2.33 suggests that the company is unlikely to be a manipulator.


Hua Nan Financial Holdings Co Beneish M-Score Related Terms

Thank you for viewing the detailed overview of Hua Nan Financial Holdings Co's Beneish M-Score provided by GuruFocus.com. Please click on the following links to see related term pages.


Hua Nan Financial Holdings Co Business Description

Traded in Other Exchanges
N/A
Address
No. 123, Songren Road, Xinyi District, Taipei, TWN, 110
Hua Nan Financial Holdings Co Ltd is a financial services group in Taiwan. The company has multiple subsidiaries that operate in financial businesses such as banking, trading, insurance, investments & trusts, asset management, and venture capital. These subsidiaries include Hua Nan Commercial Bank Ltd., Hua Nan Securities Co., Ltd., South China Insurance Co., Ltd., Hua Nan Investment Trust Corp., Hua Nan Venture Capital Co., Ltd., and Hua Nan AMC. The Hua Nan Commercial Bank subsidiary generates a vast majority of the company's revenue. This subsidiary acts as a commercial bank accepting deposits, grants, and loans as well as offering bill financing and credit cards.