China Southern Airlines Company Limited
ZNH Industrials Airlines
China Southern Airlines Company Limited (ZNH) Beneish M-score
China Southern Airlines Company Limited's Beneish M-score for fiscal 2024 cannot be worked out: total accruals to total assets cannot be worked out.
Beneish M-score, annual
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Annual newest first
| Period | Beneish M-score | Change (points) |
|---|---|---|
| FY2023 | −2.78 | 0.21 |
| FY2022 | −2.99 | (0.26) |
| FY2021 | −2.73 | (0.11) |
| FY2020 | −2.62 | (0.56) |
| FY2019 | −2.06 | 0.19 |
| FY2018 | −2.26 | 0.22 |
| FY2017 | −2.48 | 0.35 |
| FY2016 | −2.83 | (1.72) |
| FY2015 | −1.10 | — |
How fiscal 2024’s score is made up
| Component | This year | Year before | Result | Points |
|---|---|---|---|---|
| Days’ sales in receivables index | 1.39 | — | 1.28 | |
| Gross margin index | 0.99 | — | 0.52 | |
| Asset quality index | 0.95 | — | 0.38 | |
| Sales growth index | 1.07 | — | 0.96 | |
| Depreciation index Depreciation not reported — index set to 1 | 1.00 | — | Set to 1 | 0.12 |
| SG&A index | 0.99 | — | −0.17 | |
| Total accruals to total assets | — | — | n/a | — |
| Leverage index | 1.01 | — | −0.33 | |
| Beneish M-score | n/a — total accruals to total assets cannot be worked out | — | ||
How the Beneish M-score works
M = −4.84 + 0.920 × DSRI + 0.528 × GMI + 0.404 × AQI + 0.892 × SGI + 0.115 × DEPI − 0.172 × SGAI + 4.679 × TATA − 0.327 × LVGI (Beneish, 1999): eight changes in the accounts from one fiscal year to the next, which the model weighs for the pattern seen in companies that later restated their earnings. Higher is worse.
| below −2.22 | Low — no pattern the model associates with manipulation |
|---|---|
| −2.22 to −1.78 | Elevated |
| above −1.78 | Flagged by the model |
−1.78 is the cut-off usually quoted from the paper, −2.22 a common conservative one. A statistical screen, not a finding of wrongdoing.
When asset quality, depreciation or SG&A cannot be worked out, that index is set to 1, as Beneish did, and the breakdown says so; with all three missing there is no score. Depreciation includes amortisation, and asset quality leaves out securities. Not worked out for banks, insurers and REITs.
Beneish M-score against peers
| Company | Beneish M-score |
|---|---|
| RYAAY Ryanair Holdings PLC compare | −3.1× |
| LTM LATAM Airlines Group S.A. compare | −3.0× |
| ALK Alaska Air Group, Inc. compare | −2.8× |
| DAL Delta Air Lines, Inc. compare | −2.7× |
| CPA Copa Holdings, S.A. compare | −2.7× |
| LUV Southwest Airlines Co. compare | −2.7× |
| AAL American Airlines Group Inc. compare | −2.6× |
| UAL United Airlines Holdings Inc compare | −2.6× |
| ZNH China Southern Airlines Company Limited | — |
What Beneish M-score is
The Beneish M-Score combines eight year-on-year changes in the accounts into a statistical screen for patterns seen in companies that overstated earnings.
−4.84 + 0.920 × DSRI + 0.528 × GMI + 0.404 × AQI + 0.892 × SGI + 0.115 × DEPI − 0.172 × SGAI + 4.679 × TATA − 0.327 × LVGI