Cannabusinesses experience audits regularly with substantial negative outcomes of a bad audit. There are a variety of substantiation tools you can use to assist in supporting your business in an audit, most being required by the state (on a state-by-state basis). Audits are more likely to occur for cannabusinesses, so it is important to have records/receipts, keep up-to-date state and federal codes, stay on top of deadlines, properly deduct business expenses, and appropriate verification tools.
Audits can be as small as an accuracy claim so every number in your books should be properly recorded and substantiated. In our industry, properly classifying our deductions can be a huge benefit to your company when faced with an audit.
Be prepared to handle an audit when it will inevitably occur. We will help you when that unavoidable audit arrives.