Thanachart Capital PCL 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 Thanachart Capital PCL 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 * 0.8885 | + | 0.528 * 1 | + | 0.404 * 1.0496 | + | 0.892 * 1.1043 | + | 0.115 * 0.9847 |
| - | 0.172 * SGAI | + | 4.679 * TATA | - | 0.327 * LVGI |
| - | 0.172 * 1.0777 | + | 4.679 * 0.046233 | - | 0.327 * 0.9688 |
| = | -2.26 |
* 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 ฿66,864 Mil.
Revenue was 3822.427 + 3989.278 + 3839.022 + 3916.396 = ฿15,567 Mil.
Gross Profit was 3822.427 + 3989.278 + 3839.022 + 3916.396 = ฿15,567 Mil.
Total Current Assets was ฿89,768 Mil.
Total Assets was ฿161,944 Mil.
Property, Plant and Equipment(Net PPE) was ฿641 Mil.
Depreciation, Depletion and Amortization(DDA) was ฿231 Mil.
Selling, General, & Admin. Expense(SGA) was ฿10,051 Mil.
Total Current Liabilities was ฿3,120 Mil.
Long-Term Debt & Capital Lease Obligation was ฿65,108 Mil.
Net Income was 1434.599 + 1811.944 + 1777.325 + 1579.093 = ฿6,603 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = ฿0 Mil.
Cash Flow from Operations was 1381.835 + -880.992 + -3398.49 + 2013.507 = ฿-884 Mil.
|
Total Receivables was ฿68,146 Mil.
Revenue was 3677.252 + 3460.7 + 3700.054 + 3258.312 = ฿14,096 Mil.
Gross Profit was 3677.252 + 3460.7 + 3700.054 + 3258.312 = ฿14,096 Mil.
Total Current Assets was ฿90,295 Mil.
Total Assets was ฿157,089 Mil.
Property, Plant and Equipment(Net PPE) was ฿682 Mil.
Depreciation, Depletion and Amortization(DDA) was ฿241 Mil.
Selling, General, & Admin. Expense(SGA) was ฿8,445 Mil.
Total Current Liabilities was ฿3,824 Mil.
Long-Term Debt & Capital Lease Obligation was ฿64,491 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) |
| = | (66863.584 / 15567.123) | / | (68146.373 / 14096.318) |
| = | 4.295179 | / | 4.834339 |
| | = | 0.8885 |
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) |
| = | (14096.318 / 14096.318) | / | (15567.123 / 15567.123) |
| = | 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 - (89768.156 + 641) / 161943.654) | / | (1 - (90294.933 + 682) / 157089.032) |
| = | 0.441725 | / | 0.420858 |
| | = | 1.0496 |
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 |
| = | 15567.123 | / | 14096.318 |
| | = | 1.1043 |
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)) |
| = | (240.781 / (240.781 + 682)) | / | (231.083 / (231.083 + 641)) |
| = | 0.26093 | / | 0.264978 |
| | = | 0.9847 |
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) |
| = | (10050.627 / 15567.123) | / | (8444.989 / 14096.318) |
| = | 0.645632 | / | 0.599092 |
| | = | 1.0777 |
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) |
| = | ((65108 + 3120) / 161943.654) | / | ((64491 + 3824) / 157089.032) |
| = | 0.421307 | / | 0.434881 |
| | = | 0.9688 |
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 |
| = | (6602.961 - 0 | - | -884.14) | / | 161943.654 |
| | = | 0.046233 |
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.
Thanachart Capital PCL has a M-score of -2.26 suggests that the company is unlikely to be a manipulator.
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