Bursa Malaysia Beneish M-Score Database

In a previous article (Read more here), Beneish M-Score, a method to detect potential financial manipulation was discussed.  Beneish M-Score was introduced by Dr. Messod Beneish, an accounting professor at Indiana University’s Kelly School of Business in a research paper in 1991.  For M-Score that is smaller than -1.78 (more negative) is classified as non-manipulator.  Whereas for M-Score that is larger than -1.78 (moving towards zero or positive) is classified as a possible manipulation.

M-Score can be calculated using publicly available information such as financial statement from official annual report.  However, to calculate M-Score for all companies listed on Bursa Malaysia requires additional effort such as big data automation.  Firstly, a database of financial statement for every listed company in Bursa Malaysia has to be maintained digitally.  Secondly, an automation script has to be developed to extract the relevant info from the financial statement.  Thirdly, the extracted data will be fed into the M-Score database for calculation.  Lastly, if further analysis is required, the relevant M-Score info will be analysed by financial analysis.

We have built the M-Score database spanning from 2015 – 2018.  2019 database is work in progress as not all companies have published their 2019 financial data.  Below is a sample of three companies listed on Bursa Malaysia that failed the M-Score test for four consecutive years.

Company	Dec – 2018	Dec – 2017	Dec – 2016	Dec – 2015
PASUKHAS	1.738	- 1.363	- 0.842	- 1.661
PESTECH	- 1.564	- 1.146	- 0.921	- 1.737
ACOUSTECH	- 0.034	2.546	- 1.161	0.965

Fortunately, most of the companies listed on Bursa Malaysia passed the M-Score test for 2015 – 2018.  Below are examples of companies which scored well between 2015 – 2018.

Company	Dec – 2018	Dec – 2017	Dec – 2016	Dec – 2015
ANCOM	- 2.579	- 2.380	- 2.254	- 2.701
CBIP	- 2.259	- 1.807	- 2.094	- 2.439
DIGI	- 2.630	- 2.831	- 2.430	- 2.568
FREIGHT	- 2.747	- 2.147	- 2.432	- 2.855
GENM	- 3.059	- 2.264	- 3.034	- 2.286
IOI	- 2.430	-  2.029	- 2.243	- 2.670
KPJ	- 2.979	- 2.689	- 2.395	- 2.363
NESTLE	- 3.143	- 2.412	- 2.953	- 2.974
ORIENTAL	- 2.645	- 2.796	- 2.146	- 2.553
YTL CORP	- 2.317	- 2.623	- 2.295	- 2.690

To access the full list, selected companies, or in-depth M-Score analysis reports, please contact info@mpcap.com.my for pricing information.