Voters passed Missouri Amendment 2 on November 6, 2018. At that point in time, August 3, 2019, the date that Missouri’s Department of Health and Senior Services (DHSS) would begin accepting business license applications, seemed like a lifetime away. I think I can safely speak on behalf of our Missouri medical marijuana facility license applicant clients when I say that this time has flown by.
Our Cannabis Group regularly assists clients and their advisors on a variety of topics including understanding the business entity selection and structure process, selecting accounting systems, implementing internal controls, and navigating the complex tax rules of IRS Code Section 280E. With the August 3rd date looming for our Missouri applicants, we have been increasingly focused on assisting with drafting and refining various components of our client’s facility license applications.
Of the 68 questions that apply to “all applicants” the one that clients most frequently request our guidance with is Question 40 which states, “What is the plan for accounting, including but not limited to fiscal controls?”
How to Respond
As CPAs, we could, and often do, go into great detail when working with our clients on implementing their accounting processes and procedures, best practices, internal controls, etc. But because DHSS specifically limits the answer to Question 40 to “up to 500 words”, we have worked to keep our guidance, for application purposes, as “high level” and concise as possible. We have also developed a checklist of common questions for our clients to consider before responding to this question. A small sample of these questions include:
- What is your process for selecting general ledger, point of sale, and inventory tracking systems?
- What is your plan for implementing internal controls and other accounting best practices?
- Have you hired an employee, or outside accountant, to maintain your books and records on a daily basis?
- Have you engaged an outside provider to assist with reviewing the work of your in-house accountant?
- What is your process for preparing monthly/quarterly/annual payroll, sales, and income tax filings?
The Anders Cannabis Group is here to help, whether it’s before filing your application or after. If you have questions about the Missouri medical marijuana facility license application, contact an Anders advisor.
