Cycle Time for items with different initial state

[V Scire]

We're looking to track the lead and cycle time of portfolio items, and in some cases portfolio items are being created in a "later" state. Does the cycle time dashboard for portfolio items take that into account in any way?

To explain further with a generic example --

Let's say we have 5 states for portfolio items. Lead time runs from state 1 to state 5, cycle time from state 3 to state 5.

In some cases, a portfolio item is created and is immediately set to state 3. 

When we're doing reporting on lead and cycle time, we can be pretty confident the data about cycle time will be accurate since all portfolio items have hit states 3-5. To calculate lead time, we will use the cycle time reporting to look at states 1-5, but if there are some portfolio items that never hit state 1, what will that do to the report results? Will those items be excluded from the calculation? Can we set the report/dashboard to somehow use create date instead of the dates associated with state 1?