Development stage enterprise definition
/What is a Development Stage Enterprise?
A development stage enterprise is a firm that is focusing its efforts on the establishment of a viable business. The organization may not yet be generating any revenue, or its intended primary operation has not yet begun. There tends to be a high degree of uncertainty about the future prospects for this type of business, since it is still exploring the viability of products and the markets in which they will be sold.
Accounting for a Development Stage Enterprise
The accounting for a development state enterprise is the same as for a fully functional organization. The notes accompanying the entity’s financial statements should clarify the status of the organization, so that readers understand that there is a reason for the initial losses recorded by the firm.