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FarGlory Life Insurance Co (ROCO:5859) Beneish M-Score : -2.51 (As of May. 20, 2024)


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What is FarGlory Life Insurance 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 -2.51 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

The historical rank and industry rank for FarGlory Life Insurance Co's Beneish M-Score or its related term are showing as below:

ROCO:5859' s Beneish M-Score Range Over the Past 10 Years
Min: -3   Med: -2.62   Max: -2.25
Current: -2.51

During the past 13 years, the highest Beneish M-Score of FarGlory Life Insurance Co was -2.25. The lowest was -3.00. And the median was -2.62.


FarGlory Life Insurance 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 FarGlory Life Insurance 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 * 1.204+0.528 * 1+0.404 * 1.001+0.892 * 0.9259+0.115 * 0.9622
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0286+4.679 * -0.017811-0.327 * 1.1966
=-2.51

* 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 NT$5,523 Mil.
Revenue was NT$74,005 Mil.
Gross Profit was NT$74,005 Mil.
Total Current Assets was NT$0 Mil.
Total Assets was NT$699,607 Mil.
Property, Plant and Equipment(Net PPE) was NT$6,283 Mil.
Depreciation, Depletion and Amortization(DDA) was NT$458 Mil.
Selling, General, & Admin. Expense(SGA) was NT$2,407 Mil.
Total Current Liabilities was NT$0 Mil.
Long-Term Debt & Capital Lease Obligation was NT$243 Mil.
Net Income was NT$2,206 Mil.
Gross Profit was NT$2,853 Mil.
Cash Flow from Operations was NT$11,815 Mil.
Total Receivables was NT$4,955 Mil.
Revenue was NT$79,928 Mil.
Gross Profit was NT$79,928 Mil.
Total Current Assets was NT$0 Mil.
Total Assets was NT$669,849 Mil.
Property, Plant and Equipment(Net PPE) was NT$6,650 Mil.
Depreciation, Depletion and Amortization(DDA) was NT$465 Mil.
Selling, General, & Admin. Expense(SGA) was NT$2,528 Mil.
Total Current Liabilities was NT$0 Mil.
Long-Term Debt & Capital Lease Obligation was NT$194 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)
=(5523.479 / 74004.775) / (4954.624 / 79927.506)
=0.074637 / 0.061989
=1.204

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)
=(79927.506 / 79927.506) / (74004.775 / 74004.775)
=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 + 6283.486) / 699606.617) / (1 - (0 + 6650.31) / 669849.242)
=0.991019 / 0.990072
=1.001

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
=74004.775 / 79927.506
=0.9259

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))
=(465.171 / (465.171 + 6650.31)) / (458.022 / (458.022 + 6283.486))
=0.065374 / 0.067941
=0.9622

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)
=(2407.058 / 74004.775) / (2527.528 / 79927.506)
=0.032526 / 0.031623
=1.0286

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)
=((242.6 + 0) / 699606.617) / ((194.237 + 0) / 669849.242)
=0.000347 / 0.00029
=1.1966

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
=(2206.323 - 2852.529 - 11814.779) / 699606.617
=-0.017811

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.

FarGlory Life Insurance Co has a M-score of -2.51 suggests that the company is unlikely to be a manipulator.


FarGlory Life Insurance Co Beneish M-Score Related Terms

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FarGlory Life Insurance Co (ROCO:5859) Business Description

Traded in Other Exchanges
N/A
Address
No.1, Songgao Road, 28th Floor, Taipei, TWN
FarGlory Life Insurance Co Ltd is a Taiwan based life insurance company. The company offers products including personal life insurance, personal health insurance, personal accident insurance, annuity insurance, group insurance and investment-type insurance.