Hyundai Securities 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 Hyundai Securities 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 * 0.7281 | + | 0.528 * 1 | + | 0.404 * 1.0006 | + | 0.892 * 0.9237 | + | 0.115 * 0.9979 |
| - | 0.172 * SGAI | + | 4.679 * TATA | - | 0.327 * LVGI |
| - | 0.172 * 1.1428 | + | 4.679 * 0.052165 | - | 0.327 * 0.8782 |
| = | -2.54 |
* 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 (Jun16) TTM: | Last Year (Jun15) TTM: |
Total Receivables was ₩1,005,643.66 Mil.
Revenue was 99727.406 + 158022.335 + 222769.439 + 162206.792 = ₩642,725.97 Mil.
Gross Profit was 99727.406 + 158022.335 + 222769.439 + 162206.792 = ₩642,725.97 Mil.
Total Current Assets was ₩0.00 Mil.
Total Assets was ₩23,198,322.21 Mil.
Property, Plant and Equipment(Net PPE) was ₩124,509.15 Mil.
Depreciation, Depletion and Amortization(DDA) was ₩14,510.35 Mil.
Selling, General, & Admin. Expense(SGA) was ₩111,594.93 Mil.
Total Current Liabilities was ₩0.00 Mil.
Long-Term Debt & Capital Lease Obligation was ₩1,455,500.74 Mil.
Net Income was -15779.861 + 34996.721 + 63319.626 + 30959.636 = ₩113,496.12 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = ₩0.00 Mil.
Cash Flow from Operations was -84316.269 + -442235.766 + 6646.273 + -576747.207 = ₩-1,096,652.97 Mil.
|
Total Receivables was ₩1,495,327.34 Mil.
Revenue was 212861.337 + 198999.179 + 128453.867 + 155533.772 = ₩695,848.16 Mil.
Gross Profit was 212861.337 + 198999.179 + 128453.867 + 155533.772 = ₩695,848.16 Mil.
Total Current Assets was ₩0.00 Mil.
Total Assets was ₩23,114,301.66 Mil.
Property, Plant and Equipment(Net PPE) was ₩138,585.51 Mil.
Depreciation, Depletion and Amortization(DDA) was ₩16,113.36 Mil.
Selling, General, & Admin. Expense(SGA) was ₩105,724.27 Mil.
Total Current Liabilities was ₩0.00 Mil.
Long-Term Debt & Capital Lease Obligation was ₩1,651,409.28 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) |
| = | (1005643.657 / 642725.972) | / | (1495327.335 / 695848.155) |
| = | 1.564654 | / | 2.148928 |
| | = | 0.7281 |
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) |
| = | (695848.155 / 695848.155) | / | (642725.972 / 642725.972) |
| = | 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 + 124509.15) / 23198322.212) | / | (1 - (0 + 138585.507) / 23114301.657) |
| = | 0.994633 | / | 0.994004 |
| | = | 1.0006 |
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 |
| = | 642725.972 | / | 695848.155 |
| | = | 0.9237 |
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)) |
| = | (16113.36 / (16113.36 + 138585.507)) | / | (14510.352 / (14510.352 + 124509.15)) |
| = | 0.10416 | / | 0.104376 |
| | = | 0.9979 |
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) |
| = | (111594.931 / 642725.972) | / | (105724.265 / 695848.155) |
| = | 0.173628 | / | 0.151936 |
| | = | 1.1428 |
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) |
| = | ((1455500.743 + 0) / 23198322.212) | / | ((1651409.277 + 0) / 23114301.657) |
| = | 0.062742 | / | 0.071445 |
| | = | 0.8782 |
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 |
| = | (113496.122 - 0 | - | -1096652.969) | / | 23198322.212 |
| | = | 0.052165 |
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.
Hyundai Securities Co has a M-score of -2.54 suggests that the company is unlikely to be a manipulator.
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