City National 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 City National 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 * 1.0006 | + | 0.892 * 1.0862 | + | 0.115 * 0.8476 |
| - | 0.172 * SGAI | + | 4.679 * TATA | - | 0.327 * LVGI |
| - | 0.172 * 0.9935 | + | 4.679 * -6.3E-5 | - | 0.327 * 0.9316 |
| = | -2.40 |
* 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 (Jun15) TTM: | Last Year (Jun14) TTM: |
Total Receivables was $0.00 Mil.
Revenue was 349.414 + 327.655 + 324.875 + 323.693 = $1,325.64 Mil.
Gross Profit was 349.414 + 327.655 + 324.875 + 323.693 = $1,325.64 Mil.
Total Current Assets was $0.00 Mil.
Total Assets was $33,760.50 Mil.
Property, Plant and Equipment(Net PPE) was $205.51 Mil.
Depreciation, Depletion and Amortization(DDA) was $46.65 Mil.
Selling, General, & Admin. Expense(SGA) was $692.37 Mil.
Total Current Liabilities was $0.00 Mil.
Long-Term Debt & Capital Lease Obligation was $640.62 Mil.
Net Income was 68.499 + 61.566 + 65.956 + 68.651 = $264.67 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0.00 Mil.
Cash Flow from Operations was 141.793 + 65.827 + 40.755 + 18.432 = $266.81 Mil.
|
Total Receivables was $0.00 Mil.
Revenue was 320.201 + 301.046 + 296.001 + 303.154 = $1,220.40 Mil.
Gross Profit was 320.201 + 301.046 + 296.001 + 303.154 = $1,220.40 Mil.
Total Current Assets was $0.00 Mil.
Total Assets was $30,819.09 Mil.
Property, Plant and Equipment(Net PPE) was $205.17 Mil.
Depreciation, Depletion and Amortization(DDA) was $38.15 Mil.
Selling, General, & Admin. Expense(SGA) was $641.61 Mil.
Total Current Liabilities was $0.00 Mil.
Long-Term Debt & Capital Lease Obligation was $627.77 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 / 1325.637) | / | (0 / 1220.402) |
| = | 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) |
| = | (1220.402 / 1220.402) | / | (1325.637 / 1325.637) |
| = | 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 + 205.507) / 33760.498) | / | (1 - (0 + 205.168) / 30819.092) |
| = | 0.993913 | / | 0.993343 |
| | = | 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 |
| = | 1325.637 | / | 1220.402 |
| | = | 1.0862 |
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)) |
| = | (38.154 / (38.154 + 205.168)) | / | (46.651 / (46.651 + 205.507)) |
| = | 0.156805 | / | 0.185007 |
| | = | 0.8476 |
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) |
| = | (692.368 / 1325.637) | / | (641.607 / 1220.402) |
| = | 0.522291 | / | 0.525734 |
| | = | 0.9935 |
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) |
| = | ((640.617 + 0) / 33760.498) | / | ((627.768 + 0) / 30819.092) |
| = | 0.018975 | / | 0.020369 |
| | = | 0.9316 |
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 |
| = | (264.672 - 0 | - | 266.807) | / | 33760.498 |
| | = | -6.3E-5 |
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.
City National has a M-score of -2.40 suggests that the company is unlikely to be a manipulator.
City National (City National) Business Description
Traded in Other Exchanges
N/A
Address
City National Corp is a Delaware corporation organized in 1968. It is a bank holding company and a financial holding company. It provides banking, investment and trust services to its clients through its wholly-owned banking subsidiary, City National Bank. The Bank operates through 77 offices, including 16 full-service regional centers, in Southern California, the San Francisco Bay area, Nevada, New York City, Nashville, Tennessee and Atlanta, Georgia. The Company provides financial solutions to affluent individuals, entrepreneurs, professionals, their businesses and their families. The Company's segments include, Commercial and Private Banking, & Wealth Management. The Commercial and Private Banking segment provides banking products and services, including commercial and mortgage lending, lines of credit, equipment lease financing, deposits, cash management services, international trade finance and letters of credit. All investment advisory affiliates and the Bank's wealth management services are included in the Wealth Management segment. The Company's principal client base consists of small to mid-sized businesses, entrepreneurs, professionals, and affluent individuals. The Company serves its clients through relationship banking. The Company offers lending, deposit, cash management, international banking, equipment financing, and other products and services. The Bank's wealth management division make available the following investment advisory and wealth management resources to the Company's clients: investment management and advisory services and brokerage services, including portfolio management, securities trading and asset management; personal and business trust and investment services, including employee benefit trust services, 401(k) and defined benefit plans; and estate and financial planning and custodial services. The Company also advises and makes available mutual funds under the name of City National Rochdale Funds. The Bank's wealth management division and the Company's asset management subsidiaries provide both proprietary and nonproprietary products to offer asset classes and investment styles, including fixed-income instruments, mutual funds, domestic and international equities and alternative investments, such as hedge funds. Investment services are provided to institutional as well as individual clients. The Company faces competitive credit and pricing pressure as it competes with other banks and financial organizations. It is subject to extensive regulation under both federal and state law.
Executives
| Brian Fitzmaurice |
officer: EVP & Chief Credit Officer |
C/O CITY NATIONAL CORPORATION, 555 S. FLOWER ST., 18TH FL., LOS ANGELES CA 90071 |
| Clifford Gilbert-lurie |
director |
555 SOUTH FLOWER STREET, 18TH FLOOR, LOS ANGELES CA 90071 |
| Mohamad Ali |
director |
2 AVENUE DE LAFAYETTE, BOSTON MA 02111 |
| Alison Davis |
director |
255 FISERV DRIVE, BROOKFIELD WI 53045 |
| Richard Gershen |
officer: EVP & Director WMS |
CITY NATIONAL BANK, 400 N. ROXBURY DRIVE, BEVERLY HILLS CA 90210 |
| Martin Paretti |
officer: VP and Controller |
C/O CITY NATIONAL CORPORATION, 555 S. FLOWER STREET, 18TH FLOOR, LOS ANGELES CA 90071 |
| Olga Tsokova |
officer: SVP & Chief Accounting Officer |
C/O CITY NATIONAL CORPORATION, 555 S. FLOWER STREET, 18TH FLOOR, LOS ANGELES CA 90071 |
| Bruce Rosenblum |
director |
C/O CITY NATIONAL CORPORATION, 555 S. FLOWER STREET, 18TH FLOOR, LOS ANGELES CA 90071 |
| Ashok Israni |
director |
C/O CITY NATIONAL CORPORATION, 555 S. FLOWER STREET, 18TH FL, LOS ANGELES CA 90071 |
| Linda M Griego |
director |
SOUTHWEST WATER CO, 624 SO. GRAND, STE 2900, LOS ANGELES CA 90017 |
| James Iii Dowd |
officer: SVP; Interim Chief Credit Ofcr |
C/O CITY NATIONAL CORPORATION, 400 N. ROXBURY DRIVE, BEVERLY HILLS CA 90210 |
| Nancy H Gilson |
officer: VP and Controller |
C/O CITY NATIONAL CORP, GENERAL COUNSEL, 555 S. FLOWER STREET, 18TH FL, LOS ANGELES CA 90071 |
| Baghdo Akay |
officer: Senior Risk Management Officer |
C/O CITY NATIONAL CORP GENERAL COUNSEL, 400 N ROXBURY DRIVE, BEVERLY HILLS CA 90210 |
| Christopher J Carey |
officer: EVP & Chief Financial Officer |
C/O CITY NATIONAL CORP., GENERAL COUNSEL, 555 S. FLOWER STREET, 18TH FL, LOS ANGELES CA 90071 |
| Van De Kamp Andrea L |
director |
9665 WILSHIRE BLVD, STE 101, BEVERLY HILLS CA 90212 |
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