2 min read
Definition
Capital employed is the total long-term funding invested in a business — broadly equity plus long-term debt, or total assets minus current liabilities. It measures the capital put to work generating returns.
In plain terms
It is the money tied up in running the business over the long term. Comparing profit to it shows how efficiently that capital is being used.
Why it matters for your company
Return on capital employed (ROCE) — profit as a percentage of capital employed — is a key efficiency measure lenders and investors watch. A business earning strong returns on its capital is using its funding well.
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Read →Funding for UK limited companies
Credicorp lends to your company, not to you personally — short-term working capital with no personal guarantee. See what your business could access.