Beneish M-score — 8-variable academic model, fully transparent per item
Accounting problems usually leave statistical traces before they blow up. The Beneish M-score is academia's standard earnings-manipulation detector: 8 financial-statement variables weighted into one score, with M > -1.78 flagged red. We recompute it deterministically from official filings, disclosing every variable — and honestly imputing neutral values where an input is unavailable.
What the 8 variables watch
The model probes growth quality: receivables outpacing sales (DSRI), deteriorating gross margins (GMI), declining asset quality (AQI), abnormal sales growth (SGI), rising leverage (LVGI), and more. No single variable is conclusive — the flag fires only when the composite exceeds the threshold. We return every variable with its availability status; neutrally-imputed inputs are labelled as such.
What we deliberately do not do
We do not claim a red flag means fraud. Beneish is a statistical screen: it produces false positives on fast-growing firms, post-acquisition balance sheets and accounting-policy changes, and genuine manipulation can fail to trigger it at all.
We also do not publish flagged lists or blacklists, and we do no company grading. The eight variable contributions are always exposed, because knowing which variable moved the score matters far more than the score.