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Nova Banka AD (XBLB:NOVB-R-E) Beneish M-Score : -0.57 (As of May. 25, 2024)


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What is Nova Banka AD 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.

Warning Sign:

Beneish M-Score -0.57 higher than -1.78, which implies that the company might have manipulated its financial results.

The historical rank and industry rank for Nova Banka AD's Beneish M-Score or its related term are showing as below:

XBLB:NOVB-R-E' s Beneish M-Score Range Over the Past 10 Years
Min: -3.8   Med: -2.51   Max: -0.57
Current: -0.57

During the past 13 years, the highest Beneish M-Score of Nova Banka AD was -0.57. The lowest was -3.80. And the median was -2.51.


Nova Banka AD 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 Nova Banka AD 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 * 1.0017+0.892 * 2.9918+0.115 * 0.9844
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.4817+4.679 * -0.005367-0.327 * 0.797
=-0.57

* 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 (Dec22) TTM:Last Year (Dec21) TTM:
Total Receivables was BAM0.0 Mil.
Revenue was BAM278.0 Mil.
Gross Profit was BAM278.0 Mil.
Total Current Assets was BAM0.0 Mil.
Total Assets was BAM3,854.7 Mil.
Property, Plant and Equipment(Net PPE) was BAM53.0 Mil.
Depreciation, Depletion and Amortization(DDA) was BAM9.7 Mil.
Selling, General, & Admin. Expense(SGA) was BAM6.7 Mil.
Total Current Liabilities was BAM0.0 Mil.
Long-Term Debt & Capital Lease Obligation was BAM388.7 Mil.
Net Income was BAM184.7 Mil.
Gross Profit was BAM0.0 Mil.
Cash Flow from Operations was BAM205.4 Mil.
Total Receivables was BAM0.0 Mil.
Revenue was BAM92.9 Mil.
Gross Profit was BAM92.9 Mil.
Total Current Assets was BAM0.0 Mil.
Total Assets was BAM2,663.3 Mil.
Property, Plant and Equipment(Net PPE) was BAM41.1 Mil.
Depreciation, Depletion and Amortization(DDA) was BAM7.4 Mil.
Selling, General, & Admin. Expense(SGA) was BAM4.6 Mil.
Total Current Liabilities was BAM0.0 Mil.
Long-Term Debt & Capital Lease Obligation was BAM337.0 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 / 277.981) / (0 / 92.915)
=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)
=(92.915 / 92.915) / (277.981 / 277.981)
=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 + 53.04) / 3854.732) / (1 - (0 + 41.129) / 2663.298)
=0.98624 / 0.984557
=1.0017

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
=277.981 / 92.915
=2.9918

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))
=(7.351 / (7.351 + 41.129)) / (9.657 / (9.657 + 53.04))
=0.15163 / 0.154027
=0.9844

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)
=(6.688 / 277.981) / (4.641 / 92.915)
=0.024059 / 0.049949
=0.4817

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)
=((388.741 + 0) / 3854.732) / ((337.016 + 0) / 2663.298)
=0.100848 / 0.126541
=0.797

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
=(184.668 - 0 - 205.355) / 3854.732
=-0.005367

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.

Nova Banka AD has a M-score of -0.57 signals that the company is likely to be a manipulator.


Nova Banka AD Beneish M-Score Related Terms

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Nova Banka AD (XBLB:NOVB-R-E) Business Description

Traded in Other Exchanges
N/A
Address
37A Kralja Alfonsa XIII Street, Banja Luka, BIH, 78 000
Nova Banka AD is engaged in providing banking services. The services include loans, documentary work, deposits and savings, payment transactions and money transfers, and currency exchange transactions. The bank also provides non-banking activities such as broker operations, custody operations, factoring, and forfeiting. Its operating segments include Corporate, Retail, Financial market, and others.