In order to do proper inventory and cost accounting, accountants must have the proper processes and systems in place to meet compliance rules. 

Since Cannabis is considered a Schedule I substance, under 280E companies that sell or “traffic” the plant are not able to take deductions like typical businesses can. However, the DEA is on the verge of rescheduling the drug to Schedule III which eases the tax burden of 280E, and can create more complexities for Cannabis companies and the accountants that serve them.

In our latest episode, we discuss the ins and outs of cost accounting and compliance for the current landscape of the Cannabis industry, and what’s to expect when the plant inevitably gets rescheduled by the DEA.

We cover concepts that include:

• Inventory accounting best practices, tools, workpapers, and procedures

• IRC 471-2 Lower of Cost or Market considerations

• Compliant inventory count procedures

• Cultivation and manufacturing cost accounting considerations (how to find the cost to grow a pound of weed or gram of oil)

• Dispensaries and IRC 471-3

…and more!