Documentation is vital to staying in compliance and running a successful cannabis business. In the states where adult use and medical cannabis are legal, record keeping is probably the most crucial hurdles to pass. Unfortunately, it’s probably the most important aspects to take care of in this fledgling, highly-regulated industry.
Over the past two decades, cannabis businesses operated with no paper trail. They knew that the less records that they had, the less likely the DEA would see them. Then when cannabis was legalized, compliance and regulations created a tsunami within the whole industry, causing chaos, panic, and even casualties early in the game.
Efficient record keeping may be all that stands between your business’s success or failure. It’s also vital to realize that attaining state permits will not be the final. Keeping in compliance is an integral part of retaining your license.
Audits by state authorities also make it necessary to maintain your paperwork so as. Because this market is a lot more regulated than others, audits may be particularly tricky. There are many things that you can do to keep your business compliant making the audit process easier on yourself as well as the authorities conducting them.
Documentation – Store and organize all cash transactions. This really is key because money is the primary type of payment. Cannabis-related businesses aren’t permitted to take credits and deductions for sales that they make of merchandise produced from cannabis record keeping plan. They could however, deduct some costs for goods sold as they connect with other legal elements of their business.
Constantly having all records showing your compliance is important to not get caught unprepared by auditors. This includes vendor payments, sales, as well as employee salaries. Furthermore, the IRS mandates that payments over $ten thousand are reported.
At this time in the game, ignorance isn’t an excuse. The six-month grace in California has become 0ver, and firms must be fully transitioned to be compliant. These regulations require work, however, if you want to operate a successful business, you must understand every in and out of the rules.
With the cannabis industry’s strict regulatory environment, keeping accurate, detailed records has never been more important. But in addition to keeping your state’s regulators happy, these records also benefit your company.
Take, as an example, the pesticide controversy that rocked Colorado in 2015. Even though the problem was complicated-the state had two different banned pesticide lists-one cultivator’s pesticide records became central to the controversy.
Within this court case, representatives in the business said they lost their pesticide records when coffee was spilled on the log book. Then someone mistakenly threw away the log book. With no record which pesticides were used and in what amounts and how frequently these people were used, the judge had to base his decision on the worst assumption: This business was hiding something. In the long run, the judge ruled up against the business and in favour of state regulators.
You will need records – Everyone doing work in grow rooms must understand what’s being catalogued and why. That includes lighting schedules, feeding schedules and merchandise, pesticide use, etc. Quite simply, log everything.
But don’t just note that “X” pesticide was used at “Y” time. Note the amount, how long the sprays were, whenever they started so when they ended, etc.
If you’re pursuing the rules, you’ve got nothing to hide. In the event you mistakenly break the guidelines, using a log of all things you’ve done can give regulators a better idea of how you can tackle any problems. The ylwfxt information they have, the simpler their jobs is going to be as well as the happier they’ll be.
And ensure that your employees date, time-stamp and sign off on everything. It’s just as important to know who logged inside the information because it is to be aware what that information and facts are.
You will need backups – It’s good to possess records on paper, but you should also have copies. The right place to keep them is online. Storing records on a hard drive is a superb idea, but the disk can be destroyed or tampered with. So also consider storing the records on the cloud. There’s no true physical location, so there’s no way to damage your computer data.
Documentation could be a time-consuming task, too. It’s advisable to back up everything over a weekly basis, at a minimum. Making frequent backups not merely updates your records in a timely fashion, it can so in a way where that information is still fresh in your employees’ minds.