Cannabis and CBD/hemp accounting professionals need to be aware of these challenges and must be able to help their clients navigate and find solutions so that they can properly operate their business. With our personalized approach, extensive industry knowledge, and commitment to excellence, we are here to ensure that your financial operations are in compliance, optimized for growth, and positioned for long-term success. Packed with education, proven modules, systems, workpapers, and templates, our program guides accounting professionals and owner/operators along every step of the way, allowing for us to implement these tools on day one to help cannabis and CBD businesses operate compliantly. While state laws and reporting requirements fluctuate and impact this booming and relatively new business industry, our professionals maintain acute awareness of regulations put in place and how they affect our clients’ businesses. For more than 70 years, the Firm has been laser-focused on serving high-growth companies in a variety of industry verticals, and we approach the cannabis space in the same way. We are in the business of adding value to our cannabis and CBD clients, not simply performing compliance and advisory services.
The Accountant as a Strategic Business Partner
- Payroll / Labor Office Expenses Advertising Interest Expense Depreciation Research and Development and Legal Fees.
- With this ebook, you will be able to more fully understand what processes and controls need to be in place so your business can be both compliant and profitable.
- Every state that permits cannabis operators has ultra-strict guidelines to monitor the operation “from seed to sale” and at each mile marker along the way.
- CPAs piloting their own accounting practices share their challenges, successes, and lessons learned.
- Industry operators must be prepared to develop, implement, and annually document all security measures, including video surveillance, record maintenance, and a host of others.
Knowing each facet of cannabis production and commerce equips you with the best answers to clients’ tough questions. The Secure and Fair Enforcement Banking Act (SAFE) of 2021 has proven there’s light at the end of the tunnel as banks will soon be able to service cannabis sellers without fear of federal-level repercussions. You’ll need to help them understand that “getting their books done” means more than reconciling every single transaction in their business — though that’s a crucial part of it to ensure the business doesn’t get shut down.
Clio Launches Accounting Solution for Law Firms
So many times, people create a business plan to achieve licensure but don’t know how to work the plan when it finally comes time to open their doors. NACAT Pros founders have been nationally featured in dozens of major accounting and Cannabis publications including Forbes, Accounting Today, MJ Biz Daily, the Wall Street Journal, and many more. The National Association of Cannabis Accounting and Tax Professionals (NACAT Pros) was founded to standardize bookkeeping, accounting, and tax practices in the Cannabis industries. Our network exists to lend guidance, support, and encouragement as you work towards maintaining compliance and audit-ready records in any Cannabis company. Federal law, on the other hand, still identifies marijuana as a Schedule I substance, contradicting the legal status of cannabis at the state level. Marcum’s Cannabis Services Group is established in major markets throughout the country, including numerous states where cannabis has or will become legal for both medical and/or recreational use.
the financial prep package
With all of the opportunity that comes with Cannabis, let’s not forget CBD which we expect to be as big or bigger than Cannabis. In some cases, CBD is even more complex even though 280E is not required. The FDA, USDA, and other organizations are going to start cracking down even harder on CBD businesses as more rules are adopted, so our program will also help accounting professionals navigate the compliance complexities as well! Guidance for CBD compliance and accounting are also included in our program. Cannabis Gross Sales are material in the cannabis industry, but at the end of the day, how much profit and cash are you able to generate?
Our goal is to bring ideas, improvements and efficiencies that contribute to your success. Welcome to The Canna CPAs, your trusted source for comprehensive accounting and financial services tailored specifically for the cannabis industry. With expertise in cannabis accounting, cannabis bookkeeping, and cannabis tax preparation, our dedicated team of professionals understands the unique challenges and opportunities that businesses in this rapidly evolving field face.
Tax Credits and Incentives Advisory
Through meticulous exploration, Sandy Suchoff unveils a treasury of proven tax strategies, punctuated by compelling case studies and precise, actionable steps meticulously tailored to amplify profit margins and fortify cash flow. Embrace the knowledge, wisdom, and insights bestowed upon you as you embark on an empowering expedition that transcends the everyday obstacles hindering the growth and prosperity of your cannabis enterprise. With our NACAT Pros Association membership, you’ll gain invaluable educational tools and SOPs, CPE credits, and more to help you offer expert-level accounting services to companies who need a knowledgeable professional at the helm. Under their federal charters, many financial institutions are unable to accept dollars earned in the cannabis industry, and many of these same banks have begun closing the accounts of long-time customers that have chosen to get involved in this new industry. Cash Flow – best practices for handling cash from an accounting and tax perspective, including required IRS reporting.
After all, it’s what cannabusiness think they need, even if they don’t always know what that really means. An accountant can help with cash handling procedures that protect their bottom line. With many dispensaries looking to expand their operations, the presence of 280E confines businesses and prevents them from scaling upward. Expanded Employee Retention Credit (ERC) & how our professionals can assist you. Rather than seeing technology solely as an opportunity to automate processes, capitalize on the pitfalls of technological advances to offer additional value to your client.
Because so many new cannabis business owners have lots of questions I’ve pulled together the common ones I hear so you can help prospective clients understand the ways accounting professionals can support their businesses. To serve them well, a bookkeeper or accountant needs to understand these industries, Cannabis, CBD/hemp, the state/federal issues, and have good work papers, systems, and tools. In addition, there are even more industry issues such as lack of banking, complex software, state seed to sale tracking, cash management issues, investor reporting, GAAP accounting and inventory management that will affect Cannabis and CBD/hemp business operations. At The Canna CPAs, we recognize that cost of goods sold (COGS) is a critical aspect of your financial operations.
Seeking out informed individuals can help you find solutions, enabling you to offer the best guidance to your cannabis clients. With this ebook, you will be able to more fully understand what processes and controls need to be in place so your business can be both compliant and profitable. You’ll also have a better idea of what a trained Cannabis accountant should know and how to make better decisions to ensure that your business is on track to grow amid this booming industry. DOPE CFO offers the most comprehensive and top notch Cannabis and CBD/hemp accounting & tax training program. Because there is little to no GAAP guidance yet for Cannabis and CBD/hemp (the Big Four are currently not involved in the industry).
Our cannabis accounting firm specializes in helping cannabis businesses accurately calculate and allocate COGS, ensuring that you meet compliant standards, while at the same time legitimately maximizing these deductions to optimize savings. By employing industry-specific cannabis accounting strategies, we can help you streamline your operations, reduce tax burdens, and enhance profitability. Navigating the complex landscape of cannabis taxation requires a deep understanding of the Internal Revenue Code280E, which governs the tax treatment of businesses involved in the sale of controlled substances, including cannabis. Our experienced cannabis accountants are well-versed in this code and will work closely with you to maximize your tax deductions while ensuring compliance with all relevant regulations.
Setting the bar for cannabis-related businesses across the country, the ruling upheld against Harborside rendered it liable for several million dollars in back taxes. To supplement your inventory and cost accounting, you may also be tempted to use an enterprise resources planner (ERP) program. Every cannabis-legal state mandates the use of a predetermined seed-to-sale software designed to verify compliance and track cannabis production from cultivation to purchase. Cannabusinesses’ reliance on cash-only trading, which the proposed Secure and Fair Enforcement (SAFE) Banking Act would look to reduce, requires diligent tax compliance and mitigating the heightened risk of material misstatement. Cannabis businesses are regularly being audited by the IRS, and your role in their financial accounts can make all the difference in them being shut down, having to pay legal fees, or being allowed to continue running.
Limited sources of capital are available to operators in the cannabis industry because many financial institutions’ underwriting requirements preclude investing in cannabis. Listen to our podcast for the cannabis industry to learn avenues that companies in the… Hunzicker also seeks to reassure CPAs as they consider offering their services to cannabusinesses. “If there’s a question on cannabis, we can find the answer,” said Hunzicker. “My guidance to CPAs speaking to [cannabusiness] clients is to seek a tax and corporate attorney well-versed in cannabis.”
