News & Insights
Avoid the Pain of Annual Reporting with the State of Michigan
August 9th, 2022
Accounting & Outsourced Solutions |
Take advantage of the grace period provided by the Cannabis Regulatory Agency (CRA) during 2022. Under its Advisory Bulletin dated January 3, 2022, the CRA provided a holiday for 2022 for the required annual financial statement (AFS).
The CRA is using this time to revamp its reporting process and catch up on outstanding AFS reports for 2020 and 2021. The reporting requirement will resume in the near future.
This is the perfect time for all cannabis entities under the AFS requirement to revisit and revamp their accounting practices to prepare for the CRA’s new reporting requirements. Some best practices that all entities should consider are:
- Appropriate and detailed cash handling procedures.
- Maintain a detailed and accurate cash log of all transactions describing who, what, and when.
- Maintain documentation of all receipts, invoices, purchase orders, and transfer requests.
- Maintain agreements for all leases and outsourced services.
- Maintain proper separation of medical and adult-use activities within your accounting documentation.
- Routinely reconcile accounting records with METRC and State of Michigan tax filings.
- Properly adhering to owner agreements with regards to owner distributions.
- Document, document, document, everything. An audit trail of activity is your friend.
The team at Maner Costerisan is deeply invested in Michigan’s cannabis industry, and we understand the complex challenges cannabis business owners face daily. We are committed to helping our clients stay compliant while building a sound financial strategy that supports their growth. In addition, we are proud members of the Michigan Cannabis Industry Association and supporters of the Cannabis Regulatory Agency’s Social Equity Program.