Documentation is essential to staying in compliance and operating a successful cannabis business. Within the states where adult use and medical cannabis are legal, record keeping is one of the most important hurdles to pass. Unfortunately, it’s probably the most important aspects to keep up with in this particular fledgling, highly-regulated industry.
In the last two decades, cannabis businesses operated with no paper trail. They knew that the less records that they had, the not as likely the DEA would locate them. When cannabis was legalized, compliance and regulations developed a tsunami within the whole industry, causing chaos, panic, and even casualties at the start of this game.
Efficient documentation might be all that stands involving the business’s success or failure. It’s also imperative to realize that attaining state permits is not really the final. Keeping in compliance is a part of retaining your license.
Audits by state authorities also ensure it is necessary to maintain your paperwork so as. Because this sector is even more regulated as opposed to others, audits can be particularly tricky. There are many things you can do to help keep your business compliant making the audit process easier on yourself and also the authorities conducting them.
Documentation – Store and organize all cash transactions. This is key because cash is the primary kind of payment. Cannabis-related businesses aren’t allowed to take credits and deductions for sales they make of items produced from cannabis recordkeeping plan. They could however, deduct some costs for goods sold as they connect with other legal parts of their business.
Constantly having all records showing your compliance is vital to not get caught unprepared by auditors. This includes vendor payments, sales, and even employee salaries. In addition, the internal revenue service necessitates that payments over $ten thousand are reported.
At this stage inside the game, ignorance isn’t an excuse. The six-month grace in California is now 0ver, and companies has to be fully transitioned to become compliant. These regulations require work, however, if you wish to run a successful business, you have to know every in and out from the rules.
With the cannabis industry’s strict regulatory environment, keeping accurate, detailed records has never been more essential. But besides just keeping your state’s regulators happy, these records also benefit your company.
Take, for example, the pesticide controversy that rocked Colorado in 2015. Even though problem was complicated-the state had two different banned pesticide lists-one cultivator’s pesticide records became central towards the controversy.
In this particular 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. Without having a record in which pesticides were utilised and then in what amounts and how frequently they 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 against the business and in support of state regulators.
You require records – Everyone working in grow rooms must realize what’s being catalogued and why. Which 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, just how long the sprays were, whenever they started and once they ended, and so forth.
If you’re pursuing the rules, you’ve got absolutely nothing to hide. In the event you mistakenly break the guidelines, having a log of everything you’ve done will give regulators an improved idea of how to tackle any problems. The ylwfxt information they may have, the simpler their jobs will be as well as the happier they’ll be.
And ensure that your employees date, time-stamp and sign off on everything. It’s equally as important to know who logged inside the information because it is to understand what that information is.
You need backups – It’s good to have records on paper, but you should also have copies. The right place to ensure they are is online. Storing records over a hard drive is an excellent 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 absolutely no way to damage your information.
Documentation can be a time-consuming task, too. It’s best to support everything over a weekly basis, at the minimum. Making frequent backups not merely updates your records in a timely fashion, it does so in a way where that information and facts are still fresh in your employees’ minds.