The global market for legal marijuana is growing rapidly, and more companies are now getting into the industry. A Cannabis Company CFO with expertise specifically in this industry will keep your cannabis business financially on track and profiting. Here are a few important reasons to consider hiring a CFO for your cannabis company today:
Cannabis and CBD/hemp accounting is specialized
Accounting for cannabis companies is complex and requires specialized expertise in the industry, specifically regarding the 280e and COGS deductions. An accountant or virtual CFO inexperienced in the cannabis industry won’t have the niche accounting tools necessary to serve the industry. This inexperience quickly leads a company into trouble with the IRS.
You could be missing out on profits
Cannabis companies face higher federal tax rates. Therefore, it’s imperative to make sure you are paying the correct amount. Overpaying means missing out on profit, and not paying enough means your company is at risk of being penalized. Since a virtual CFO is responsible for managing all financial aspects of the business, they can help your business find the right financial strategies to make sure your profit is not lost when it’s time to pay taxes.
Better processing of transactions and other financial information
A CFO is a person on your team that handles all financial reporting. They are the person keeping a close record of your company’s profit and losses. Additionally, they review all numbers for accuracy. It’s necessary to have this expert on your team because they will keep your business on track financially.
Knowing the loopholes can save you money
Cannabis borrowers pay a cannabis premium, meaning rates on real estate are up to twice the standard rate. Being that cannabis is not federally legalized, cannabis business loans are frequently inaccessible and expensive. However, a CFO with knowledge of the cannabis industry can help you navigate this process and direct you to find the best interest rates and terms.
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