At CashGrows CPAs, we understand the importance of recording and classifying entries appropriately. We can even help train your employees to keep proper bookkeeping and controls.
In order to maximize deductions and minimize taxable income pursuant to IRC 471, GAAP cost accounting is required in order to allocate indirect costs to the cost of goods sold.
Why is it important?
Given that the IRS is increasing their audits in the cannabis industry, it is critical that your books and records are free of any misstatement. With IRC 471, certain direct costs are not allowed to be deducted according to the IRS. Failure to comply with these regulations carry the risk of license forfeiture, penalties & fines, and loss of business. Be sure to consult with an accountant who is an expert in the cannabis industry to understand what costs may not be deducted.
Under the same code, the opposite also holds true and you could be leaving money on the table that is critical to your business. Certain indirect costs may be allocated into your cost of goods sold which will reduce your taxable income.
Further if you looking for investors to help grow your business or are looking into any mergers and acquisition activity, your partners will want to know that your books and records are accurate and clearly represent the financial picture of your operations.
We'll help you tackle all your bookkeeping needs in accordance with IRS guidelines. We have the skills, knowledge and charisma to handle all of your accounting needs. We are ready to tackle any financial challenges that you may have as your trusted CPAs.