Allied Cooperative Insurance Group (SAU:8150) Beneish M-Score : -2.61 (As of May. 15, 2024)

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What is Allied Cooperative Insurance Group 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 -2.61 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

The historical rank and industry rank for Allied Cooperative Insurance Group's Beneish M-Score or its related term are showing as below:

SAU:8150' s Beneish M-Score Range Over the Past 10 Years
Min: -3.75 Med: -2.55 Max: -1.87
Current: -2.61

During the past 13 years, the highest Beneish M-Score of Allied Cooperative Insurance Group was -1.87. The lowest was -3.75. And the median was -2.55.

Allied Cooperative Insurance Group 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 Allied Cooperative Insurance Group for today is based on a combination of the following eight different indices:

-4.84

0.92 * DSRI

0.528 * GMI

0.404 * AQI

0.892 * SGI

0.115 * DEPI

-4.84

0.92 * 0.2637

0.528 * 1

0.404 * 1.0053

0.892 * 1.558

0.115 * 0.7798

0.172 * SGAI

4.679 * TATA

0.327 * LVGI

0.172 * 0

4.679 * -0.082023

0.327 * 0.1344

-2.61

* 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 ﷼1.8 Mil.
Revenue was 231.928 + 244.78 + 231.794 + 212.189 = ﷼920.7 Mil.
Gross Profit was 231.928 + 244.78 + 231.794 + 212.189 = ﷼920.7 Mil.
Total Current Assets was ﷼0.0 Mil.
Total Assets was ﷼929.6 Mil.
Property, Plant and Equipment(Net PPE) was ﷼4.8 Mil.
Depreciation, Depletion and Amortization(DDA) was ﷼5.4 Mil.
Selling, General, & Admin. Expense(SGA) was ﷼0.0 Mil.
Total Current Liabilities was ﷼0.0 Mil.
Long-Term Debt & Capital Lease Obligation was ﷼0.3 Mil.
Net Income was 17.044 + 32.299 + 10.523 + 3.54 = ﷼63.4 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = ﷼0.0 Mil.
Cash Flow from Operations was -2.658 + 52.659 + 16.61 + 73.04 = ﷼139.7 Mil.

Total Receivables was ﷼4.3 Mil.
Revenue was 166.15 + 153.693 + 139.672 + 131.431 = ﷼590.9 Mil.
Gross Profit was 166.15 + 153.693 + 139.672 + 131.431 = ﷼590.9 Mil.
Total Current Assets was ﷼0.0 Mil.
Total Assets was ﷼762.8 Mil.
Property, Plant and Equipment(Net PPE) was ﷼7.9 Mil.
Depreciation, Depletion and Amortization(DDA) was ﷼5.5 Mil.
Selling, General, & Admin. Expense(SGA) was ﷼25.3 Mil.
Total Current Liabilities was ﷼0.0 Mil.
Long-Term Debt & Capital Lease Obligation was ﷼2.1 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)
	=	(1.778 / 920.691)	/	(4.327 / 590.946)
	=	0.001931	/	0.007322
	=	0.2637

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)
	=	(590.946 / 590.946)	/	(920.691 / 920.691)
	=	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 + 4.8) / 929.554)	/	(1 - (0 + 7.905) / 762.789)
	=	0.994836	/	0.989637
	=	1.0053

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
	=	920.691	/	590.946
	=	1.558

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))
	=	(5.531 / (5.531 + 7.905))	/	(5.367 / (5.367 + 4.8))
	=	0.411655	/	0.527884
	=	0.7798

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)
	=	(0 / 920.691)	/	(25.298 / 590.946)
	=	0	/	0.042809
	=	0

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)
	=	((0.348 + 0) / 929.554)	/	((2.122 + 0) / 762.789)
	=	0.000374	/	0.002782
	=	0.1344

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
	=	(63.406 - 0	-	139.651)	/	929.554
	=	-0.082023

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.

Allied Cooperative Insurance Group has a M-score of -2.61 suggests that the company is unlikely to be a manipulator.

Allied Cooperative Insurance Group Beneish M-Score Related Terms

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Allied Cooperative Insurance Group (SAU:8150) Business Description

Industry

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Comparable Companies

Traded in Other Exchanges

N/A

Address

Prince Turki bin Abdulaziz Al-Awal Road, P.O. Box 40523, Unit No. 2171, Hittin District, Riyadh, SAU, 11511

Website

https://www.acig.com.sa

Allied Cooperative Insurance Group is a Saudi Arabia based insurance company. The activities of the Company are to transact cooperative insurance operations and related activities in the Kingdom of Saudi Arabia. The operating segment of the company are Medical Insurance, Motor Insurance and General Accident Insurance segments. Medical segment provides compensation to policy holders for expenses incurred in treatment of a disease, illness or injury. Motor provides coverage against losses and liability related to motor vehicles. Other includes property, marine, aviation, accident and liability categories. It earns a vast majority of revenues from the motor insurance segment.