👉 Excel IOR, or Internal Operating Ratio, is a financial metric used to assess a company's efficiency in managing its working capital. It measures the ratio of current assets to operating expenses, indicating how effectively a company converts its assets into cash to cover operational costs. A lower IOR suggests better working capital management, as it implies that the company generates more cash from its assets relative to its operating expenses. Conversely, a higher IOR may signal inefficiencies, such as excessive inventory or high overhead costs, which can strain liquidity and impact profitability.
