Montier 'Cooking the Books' C-Score

What is the definition of Montier C-Score?

James Montier aimed to create a simple scoring system that would highlight companies that may be 'cooking the books'. The C-Score was the result.

An analogue to the Piotroski, it measures six inputs in a binary fashion to create a score between zero and six. Inputs include: the divergence between net income and cash-flow, increasing days sales outstanding, increasing days sales of inventory, increasing current assets to revenues, declining depreciation relative to PPE and high total asset growth.


Stockopedia explains Montier C-Score...

Montier found that companies with high C-Scores under performed the market by 8% per annum, generating a mere 1.8% return between 1993 and 2007.

He recommended using it in tandem with a high valuation measure. A C Score = 5 used in tandem with a Price/Sales Ratio > 2 generated a negative absolute return of 4% p.a. in the US.

For a full review of the C Score please click here.


Which Guru Screens is Montier C-Score used in?

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  • Apple (AAPL)

  • Shell (RDSA)

  • Twitter (TWTR)

  • Volkswagon AG (VOK)

  • McDonalds (MCD)

  • Vodafone (VOD)

  • Barratt Homes (BDEV)

  • Microsoft (MSFT)

  • Tesco (TSCO)
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