CPA Services – Cannabis Industry State

CPA Services – Cannabis Industry State

CPA Services – Cannabis Industry State – aBIZinaBOX has created an unofficial repository for the CPA profession and cannabis business.

CPA Services Cannabis Industry
aBIZinazBOX Cannabis Practice Group

businesses to be able to quickly check out the scope of services that CPA’s are permitted to provide to cannabis industry businesses by State Boards of Accountancy.

The resource is located here.

CPAs who wish to provide services to clients in the marijuana industry will encounter many gray areas. However, in addition to the numerous considerations discussed thus far, there are a few more steps CPAs can take to mitigate the risks associated with taking on a client in this industry.

  • A CPA should always have an engagement letter with his or her client that explains what services are to be provided, what services will not be provided, and how much those services will cost.
  • The CPA should require each of the principals in the business to sign a representation letter stating that they understand the requirements of state law related to cannabis businesses and that they intend to fully comply with those requirements to the best of their ability at all times.
  • CPAs should also document all work and communication with a client, even if that communication takes place in an informal setting.
  • A CPA should seek out advice from colleagues that have clients in the marijuana industry to determine how they are trying to best mitigate risk.
CPA Services Cannabis Industry

CPA Services Cannabis Industry – Businesses operating in the marijuana industry are seeking both assurance and non-assurance attest services, including audits, reviews, and agreed upon procedures engagements.

CPAs wishing to provide services to these businesses must first address the issue of competency. Does the CPA have enough knowledge of the industry to plan an engagement properly? A CPA should fully understand the entity, including the legal and regulatory environment of the industry, in order to assess the risk of material misstatement — a challenge when that environment is ever-changing and unclear. In planning an audit and determining the risks of material misstatements, a CPA should consider the numerous risks associated with businesses in this industry.

The key point for tax professionals working with clients in the marijuana industry is due diligence. Because of the lack of clear guidance, CPAs should be conscientious in reviewing all available information related to standards for tax return reporting, confidentiality of client information, conflicts of interest, due diligence, knowledge of client’s error, contingent fees, and written tax advice.

If you are a licensed California CPA that has questions, we are always willing to offer our thoughts. Please note that due to our workload, this offer is for California CPA’s only, strictly enforced.

CPA Services Cannabis Industry

Author: abizcannabis

Managing Director & CEO of integrated transactional financial advisory, tax, and technology consulting firm - aBIZinaBOX Inc New York, Chicago, and OaklandCPA.CITP.CISM.CGEIT.CGMAExpertise with: Alt. Investments/Private Equity, Real Estate, Professional Services, CA Cannabis, Tech Start-Ups and Distressed Assets/DebtTechnology Certifications including:Advanced & High Complexity Cloud Integrator AICPA PCPS, CAQ,, IMTA, CITP ISACA CGEIT, CISMState CPA Societies in California, Florida, Illinois, New York and TexasExpertise with Regulatory Compliance - US - HIPAA, FINRA, SEC Rule 17(a)(3)/(4), eDiscovery, FINCEN - EU- EBA, ESMA, EIOPA UK - BoE, PRA, FCA