MF Banka AD (XBLB:IEFB-R-A) Beneish M-Score : -2.29 (As of May. 25, 2024)

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What is MF 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.

Good Sign:

Beneish M-Score -2.29 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

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

XBLB:IEFB-R-A' s Beneish M-Score Range Over the Past 10 Years
Min: -3.17 Med: -2.34 Max: -1.86
Current: -2.29

During the past 13 years, the highest Beneish M-Score of MF Banka AD was -1.86. The lowest was -3.17. And the median was -2.34.

MF 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 MF Banka AD 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 * 1

0.528 * 1

0.404 * 1.0009

0.892 * 1.1427

0.115 * 0.8853

0.172 * SGAI

4.679 * TATA

0.327 * LVGI

0.172 * 1.0985

4.679 * 0.017161

0.327 * 0.9595

-2.29

* 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 BAM0.00 Mil.
Revenue was BAM53.59 Mil.
Gross Profit was BAM53.59 Mil.
Total Current Assets was BAM0.00 Mil.
Total Assets was BAM785.22 Mil.
Property, Plant and Equipment(Net PPE) was BAM11.48 Mil.
Depreciation, Depletion and Amortization(DDA) was BAM3.24 Mil.
Selling, General, & Admin. Expense(SGA) was BAM3.12 Mil.
Total Current Liabilities was BAM0.00 Mil.
Long-Term Debt & Capital Lease Obligation was BAM99.97 Mil.
Net Income was BAM9.19 Mil.
Gross Profit was BAM0.00 Mil.
Cash Flow from Operations was BAM-4.29 Mil.

Total Receivables was BAM0.00 Mil.
Revenue was BAM46.90 Mil.
Gross Profit was BAM46.90 Mil.
Total Current Assets was BAM0.00 Mil.
Total Assets was BAM710.38 Mil.
Property, Plant and Equipment(Net PPE) was BAM11.00 Mil.
Depreciation, Depletion and Amortization(DDA) was BAM2.67 Mil.
Selling, General, & Admin. Expense(SGA) was BAM2.49 Mil.
Total Current Liabilities was BAM0.00 Mil.
Long-Term Debt & Capital Lease Obligation was BAM94.26 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 / 53.591)	/	(0 / 46.897)
	=	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)
	=	(46.897 / 46.897)	/	(53.591 / 53.591)
	=	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 + 11.476) / 785.221)	/	(1 - (0 + 11.002) / 710.38)
	=	0.985385	/	0.984513
	=	1.0009

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
	=	53.591	/	46.897
	=	1.1427

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))
	=	(2.666 / (2.666 + 11.002))	/	(3.243 / (3.243 + 11.476))
	=	0.195054	/	0.220327
	=	0.8853

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)
	=	(3.122 / 53.591)	/	(2.487 / 46.897)
	=	0.058256	/	0.053031
	=	1.0985

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)
	=	((99.972 + 0) / 785.221)	/	((94.257 + 0) / 710.38)
	=	0.127317	/	0.132685
	=	0.9595

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
	=	(9.189 - 0	-	-4.286)	/	785.221
	=	0.017161

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.

MF Banka AD has a M-score of -2.29 suggests that the company is unlikely to be a manipulator.

MF Banka AD Beneish M-Score Related Terms

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MF Banka AD (XBLB:IEFB-R-A) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Financial Services » Banks » MF Banka AD (XBLB:IEFB-R-A) » Definitions » Beneish M-Score

Comparable Companies

Traded in Other Exchanges

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Address

Aleja Svetog Save Street No. 61, Banja Luka, BIH

Website

https://www.mfbanka.com

MF Banka AD provides is a regional bank engaged in providing banking products and services. The bank is licensed to perform banking activities that include payment transfers, crediting and depositary operations in the country and abroad. It offers savings products, loans, domestic and foreign payment services, deposit and documentary operations services, cards, and electronic and mobile banking, SMS, and ATM services. Geographically it operates in the region of Bosnia and Herzegovina and serves individuals, businesses, and small and medium-sized enterprises.