Webinar Recap: Trends and Strategies for Cannabis Businesses
August 09, 2022
By Eric Altstadter & Wayne Margulies
On July 28, 2022, the EisnerAmper Cannabis and Hemp Team and Wayne Margulies of the Cannabis & Hemp Insurance Specialty Team at HUB International Limited, hosted a webinar on strategies cannabis-based business owners can use to effectively scale their operations.
During the hour-long event, High Noon with EisnerAmper - The Business of Cannabis, we covered trends, developments, and insights on everything from proper accounting and bookkeeping to new insurance and tax regulations.
Here are a few of the key takeaways from the discussion. You can view the full webinar recording here.
The Current State of the Industry
As more states continue to legalize the sale of recreational cannabis, most recently New York and New Jersey, more and more businesses continue to pop up. During this portion of the webinar, EisnerAmper’s Eric Altstadter covered everything from new federal regulatory changes with the Marijuana Opportunity Reinvestment and Expungement (“MORE”) Act, to new developments with cannabis banking rules and the Strengthening the Tenth Amendment Through Entrusting States (“STATES”) Act.
Why Cannabis Businesses Need Proper Accounting/Books and Records
When it comes to bookkeeping and accounting, it’s important to look at cannabis-based operations as what they are—real businesses that require accurate and proper recordkeeping. During the webinar, EisnerAmper’s Gaye Eschenbach covered how business leaders can best keep proper books to make smarter business decisions, as well as uncover possible fraud or theft. Eschenbach additionally covered the importance of separating business and personal finances, keeping track of everything, and incorporating internal controls.
Insurance Issues and Considerations
Like any business, cannabis-based operations need the proper insurance policies to meet their unique needs. HUB International’s Wayne Margulies explained in his session the different types of insurance policies a cannabis-based business would need based on their function and operations, such general, product, and property coverages.
Additionally, Margulies stressed the importance of being proactive with insurance, rather than waiting until after a business receives their license. Business leaders should be reaching out to brokers and beginning the discovery process on risk and insurance solutions for their operations, sooner than later.
Income, Sales, and Local Tax Compliance
The cannabis industry is no stranger to constant changes in tax legislation, which all businesses need to adhere to. EisnerAmper’s Ben Aspir led a discussion during the webinar on what business owners need to know about income, sales, and local tax compliance rulings in the industry.
Specifically, Aspir spoke about both the federal and state implications of IRC Sec. 280E, as well as its contents and history. He also commented on new state tax changes in both New York and New Jersey that are impacting cannabis-based businesses.