Capitalisation vs. Capitalization — What's the Difference?
By Urooj Arif & Maham Liaqat — Updated on March 11, 2024
Capitalisation and capitalization are two spellings of the same term, indicating the process of funding a business or the total value of its outstanding shares. The former is used in British English, while the latter in American English.
Difference Between Capitalisation and Capitalization
Table of Contents
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Key Differences
Capitalisation, as it is spelled in British English, refers to the process of providing a company with capital by issuing shares of stock or incurring debt. On the other hand, capitalization, with a "z", follows the American English spelling convention and represents the same concept. This variance in spelling highlights the broader differences between British and American English, especially in terms of orthography.
The term capitalisation not only refers to the financial aspect of raising funds but also to the calculation of the market value of a company by multiplying its share price by the total number of shares outstanding. Whereas, capitalization, despite the difference in spelling, carries the identical meaning and application in financial contexts within the United States, showcasing the importance of context and audience in language use.
In British English, the use of 's' in words where 'z' is used in American English is common, as seen in capitalisation versus capitalization. This reflects historical and linguistic evolutions that have led to these variations. On the other hand, American English often adopts a more phonetic spelling approach, which is why the 'z' is used, aiming for a representation closer to the word's pronunciation.
When writing formal documents or communicating in settings that prefer British English, using "capitalisation" is advisable to align with local conventions. On the other hand, "capitalization" should be employed when the audience or the document adheres to American English standards, ensuring that the communication is not only correct but also culturally and linguistically appropriate.
These variations between British and American English extend beyond financial terms like capitalisation/capitalization, affecting numerous words in the English language. This duality enriches the language, offering flexibility and diversity in its use, while also highlighting the importance of understanding the preferences of your audience or the standards of the medium you are using.
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Comparison Chart
Spelling
Uses 's'
Uses 'z'
Usage
Preferred in British English
Preferred in American English
Phonetics
Reflects traditional spelling
Closer to phonetic spelling
Contextual Application
Same financial processes
Identical financial processes
Global Understanding
Common in Commonwealth countries
Predominant in the United States
Compare with Definitions
Capitalisation
Conversion of income or assets into capital.
Capitalisation of earnings increases a company's equity value.
Capitalization
Transforming assets or earnings into capital value.
The capitalization of retained earnings can benefit shareholders.
Capitalisation
Calculating the present value of a future income stream.
Real estate investments often involve capitalisation rates.
Capitalization
The process of providing funds for a business to grow.
Capitalization is essential for scaling operations.
Capitalisation
The total market value of a company's outstanding shares.
The startup's rapid growth doubled its capitalisation within a year.
Capitalization
The use of uppercase letters in writing.
The English language has specific rules for capitalization.
Capitalisation
The act of funding a business through debt or equity.
The company's capitalisation was crucial for its expansion plans.
Capitalization
Determining the market value of a company by its shares.
After the IPO, the company's capitalization soared.
Capitalisation
The process of writing or printing in capital letters.
Proper nouns require capitalisation in English.
Capitalization
Computing the current value of future profits.
The capitalization rate is a key metric in property investment.
Capitalisation
The act or process of capitalising.
Capitalization
Capitalization (American English) or capitalisation (British English) is writing a word with its first letter as a capital letter (uppercase letter) and the remaining letters in lower case, in writing systems with a case distinction. The term also may refer to the choice of the casing applied to text.
Capitalisation
Choice of case (when writing a word); the act or process of writing a word in a particular case, such as ALL CAPS, Title Case, CamelCase, Sentence case, or all lowercase.
English and French have different rules for the capitalisation of the names of the days of the week.
Capitalization
The practice or act of capitalizing.
Capitalisation
The act or process of seizing (an opportunity) and profiting or obtaining an advantage (from it).
Capitalization
The sum that results from capitalizing.
Capitalisation
The state of being capitalised.
Capitalization
The amounts and types of long-term financing used by a firm, including common stock, preferred stock, retained earnings, and long-term debt.
Capitalisation
The state of having a particular case, such as ALL CAPS or all lowercase.
His capitalisation was erratic: sometimes he wrote "British", sometimes "british", sometimes "briTish"...
Capitalization
The total par value or stated value of no-par capital stock issues.
Capitalisation
The total value of all outstanding shares for a publicly-traded company
Capitalization
The use of capital letters in writing or printing.
Capitalisation
Same as capitalization.
Capitalization
Standard spelling of from2=Oxford British spelling
Capitalisation
Writing in capital letters
Capitalization
The act or process of capitalizing.
Capitalisation
An estimation of the value of a business
Capitalization
Writing in capital letters
Capitalisation
The act of capitalizing on an opportunity
Capitalization
An estimation of the value of a business
Capitalisation
The sale of capital stock
Capitalization
The act of capitalizing on an opportunity
Capitalization
The sale of capital stock
Common Curiosities
Are capitalisation and capitalization the same?
Yes, they are the same concept with different spellings based on British or American English preferences.
Why does British English use 's' while American English uses 'z'?
This difference is due to historical linguistic evolutions and the preference for phonetic spelling in American English.
Is there a preference for one spelling over the other globally?
The preference depends on the regional variation of English being used; British English is common in the UK and Commonwealth, while American English is predominant in the USA.
How does capitalisation/capitalization affect a company's value?
It determines the market's perception of a company's worth based on its ability to generate future earnings.
What is capitalisation/capitalization?
The process of funding a business through equity or debt and the total value of its outstanding shares.
What role does capitalisation/capitalization play in investment decisions?
Investors use it to assess the size and stability of a company, influencing their investment choices.
Can the term refer to non-financial contexts?
Yes, both terms can also refer to the act of writing or printing in capital letters.
How does one calculate a company's capitalisation/capitalization?
By multiplying the current share price by the total number of outstanding shares.
Can capitalisation/capitalization impact a company's stock price?
Indirectly, as it involves issuing new shares or debt, which can dilute existing share value or increase liabilities.
Are there specific rules for capitalisation/capitalization in writing?
Yes, there are grammatical rules dictating when and how to use capital letters in both variations of English.
Does capitalisation/capitalization have different meanings in different fields?
While primarily financial, it also refers to orthographic practices in writing.
What is the significance of capitalisation/capitalization in the economy?
It reflects a company's financial health and growth potential, influencing economic development.
Why is capitalisation/capitalization important in real estate?
It helps investors evaluate the profitability and return on investment of property based on future income streams.
Does the spelling variation affect understanding in international contexts?
Generally, no, as the context usually makes the meaning clear regardless of spelling.
Is there a preference for capitalisation or capitalization in academic writing?
The preference is based on the style guide being followed, which is usually aligned with either British or American English conventions.
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Written by
Urooj ArifUrooj is a skilled content writer at Ask Difference, known for her exceptional ability to simplify complex topics into engaging and informative content. With a passion for research and a flair for clear, concise writing, she consistently delivers articles that resonate with our diverse audience.
Co-written by
Maham Liaqat
