These are some of the major missteps that cannabis CEOs and accounting professionals make in their business design and operations:
1. Treating investors and employees badly.
Everyone must follow the rules in order for a cannabis business to be compliant. From safety to how cash is handled, if everyone isn’t on the same page, it creates a recipe for disaster.
And while it’s a newly legalized industry and it is growing astronomically, a cannabis business is still a business. Poor accounting practices, lack of executive direction and leadership, an ineffective HR system, and a team that is improperly- or under-trained are all still going to sink the ship, just as with any other business. This can result in potential disputes, legal action, or even the demise of the company.
2. Lack of Compliance function within their business unit(s).
The lack of a Compliance Plan, Chief Compliance Officer, or regular compliance audits can lead to compliance issues, amongst all sorts of other problems. Seemingly countless Federal, state, and local government agencies all have regulations affecting legal cannabis operations. Compliance with these regulations is what is going to keep you out of hot water, so make sure systems are in place to keep up with legislation that applies to your geographical region. Not adhering to these laws and regulations can lead to potential fines, penalties, or even the loss of your license.
