Defensive Interval Ratio Calculator - Liquidity Days

The defensive interval ratio (DIR), also called the defensive interval period, estimates how many days a company could cover ordinary operating costs using only assets that can be spent or collected quickly. Those assets are cash, cash equivalents, marketable securities, and accounts receivable. Treasurers, credit analysts, and lenders use the ratio as a liquidity screen that is easier to explain than a current ratio because the answer is expressed in days of coverage rather than a unitless multiple. The formula is DIR = (cash + marketable securities + accounts receivable) ÷ (annual operating expenses ÷ 365). Annual operating expenses should be cash operating costs when you want a cash-coverage view, so many analysts exclude depreciation and other non-cash charges. The defensive interval ratio calculator converts the annual expense base into an estimated daily burn, then divides liquid assets by that burn. A result of 109.50 days means the firm could theoretically operate for about three and a half months if new sales stopped and no additional financing arrived. Use DIR when comparing two reporting dates after a working-capital squeeze, when a lender asks how long cash-like assets would last, or when a board wants a simple stress test before a dividend, buyback, or expansion. Pair the ratio with the cash ratio, current ratio, and a short-term cash forecast. A business with slow collections can look healthier on DIR than it will look in a 13-week cash forecast because receivables are treated as immediately available at book value. The estimate has limits. Receivables may not convert at face value, marketable securities can be restricted or hard to sell in a stress, and dividing by 365 ignores seasonality. DIR is not a going-concern opinion and does not model payroll timing, debt maturities, or covenant tests. Recalculate after material collections, revolver draws, or expense changes, and take every input from the same reporting date and currency.