title: SOP 98-5 brings uniformity to reporting start-up costs.
abstract: The American Institute of Certified Public Accountants (AICPA) issued Statement of Position (SOP) No. 98-5, Reporting on the Costs of Start-Up Activities, in April 1998 to provide organizations with guidance on how to report start-up and organization costs. Because some companies were expensing start-up costs while other companies were capitalizing start-up costs with a variety of periods over which to amortize costs, it was difficult to compare companies' financial statements. SOP No. 98-5 will bring uniformity to the treatment of start-up and organization costs by dictating that these costs be expensed as incurred. AICPA's Accounting Standards Executive Committee adopted an intentionally broad definition of start-up costs to capture the vast majority of costs associated with starting up an organization. SOP No. 98-5 takes effect for financial statements for fiscal years beginning after December 15, 1998, but can be applied earlier for fiscal years for which financial statements have not been issued.
authors.affiliation: CSA International, Cleveland, OH, USA.
authors.forename: R W
authors.initials: RW
authors.lastname: Luecke
authors.forename: D T
authors.initials: DT
authors.lastname: Meeting
mesh_terms: D000066:Accounting / Q000379:methods* / Q000592:standards; D002201:Capital Expenditures; D003361:Cost Allocation / Q000379:methods* / Q000592:standards; D005375:Financial Audit; D005377:Financial Management, Hospital; D017408:Guidelines as Topic; D006754:Hospital Restructuring / Q000191:economics*; D016730:Program Development / Q000191:economics*; D014481:United States