Overview of SOP 98-1 and Financial Management

Statement of Position (SOP) 98-1 is a United States accounting standard that addresses the capitalizable activities of software developed for internal use. Specifically, SOP 98-1 establishes the conditions that must be met before internal-use software can be capitalized. Financial Management capabilities can help optimize project planning and execution for SOP 98-1 compliance in the following ways:

  • Projects and tasks can be designated as Capitalizable, meaning costs (expenses) incurred during these phases can be accounted as capital costs as opposed to operating costs. This distinction is also available for project templates, so that you can create projects with capitalization consistently available.

  • Capital and operating expenses can be viewed at the project, program, or portfolio level, and analyzed accordingly.

Note: SOP 98-1 tracking must enabled as described in Enabling SOP 98-1 Tracking for cost data to be split into Capital and Operating categories.