This study shows that US Certified Public Accountants should weigh the risk of federal prosecution and potential loss of the Certified Public Accountant license when deciding whether to serve a CRB client. Europe is the second-largest market owing to the growing use of medical cannabis and progressive legislation. It is being used legally in medical settings to treat conditions ranging from cancer to appetite stimulants in patients with AIDS-related syndrome.

• With a relatively fast application process, businesses can get set up with Paybotic within one to two business days.
• In addition, Certified Public Accountants may believe there is risk that associating with the cannabis industry could damage their reputation in the business community with current or prospective clients.
• Four CRBs in remote areas often had to transport cash long distances to a bank that would give them an account.
• Next, the Certified Public Accountant needs to read Code Section 280E in its entirety.
• This creates considerable business opportunity for Certified Public Accountants who are willing to bear the related risk.
• With cannabis retailers deemed essential businesses during the lockdown, marijuana sales in California, Colorado, Nevada, Oregon and Washington state surged 39.2% in 2020, according to MJ Biz Daily.

Aurora Cannabis Announces Fiscal 2022 Fourth Quarter and Full Year Results

A study led by researchers at the University of Michigan focused on adolescent drug and alcohol use. The study found that marijuana use among adolescents has not changed significantly during the pandemic, though the study also noted a record decline in the perceived availability of marijuana. Download the free “New Cannabis Ventures” app on the iOS App Store or Google Play and get real-time push notifications straight to your phone on the latest breaking news and exclusives published.

Consumer Products & Retail

It is a non-intoxicating compound and is popularly used in various medical applications such as seizures, anxiety, and pain. With the volatility and uncertainty of the merger saga out of the way, optimistic sales numbers and a relatively cheap valuation, there may be greater risk here, but there is also a path to upside. The Cannabist Company, formerly Columbia Care, called off a mega-deal with Cresco Labs this summer that would have created one of the biggest companies in the cannabis space. Like most companies in the industry, Verano struggled last year, falling 42%.

Risks of Buying Cannabis Stocks

Additionally, governments recognize the economic benefits of a regulated marijuana market, including substantial tax revenues, business growth, and job opportunities, which have been compelling drivers for cannabis legalization. Furthermore, the growing demand for recreational cannabis led to new entrants in the market. For instance, in May 2023, Heritage Cannabis Holdings Corp., a Canada-based company, announced its entry into the recreational market in New York with the launch of RAD-branded vape and concentrate products. Some cannabis businesses focus on medical marijuana, while others focus on recreational marijuana, and still others handle both forms.

• But clients rely on you to keep track of case outcomes, the latest in the regulatory landscape and the pace of impending changes.
• This year, airlines in aggregate will earn a 5.7% return on invested capital, and that is well below the average 9% cost of capital.
• They should examine the financial statements of the company, and they should assess the skills of its management.
• Interviews of participants from states that are newer to the cannabis marketplace may result in findings that are different from the findings of this study of two mature cannabis states.
• As mentioned above, just under half of U.S. states and territories have legalized recreational cannabis use as of March 2024.
• THC (Delta-9-Tetrahydrocannabinol) is the primary chemical compound responsible for the product’s euphoric effects and is majorly used for recreational activities.

Cannabis market statistics

Tax revenue from the industry is funding public health and infrastructure initiatives at the state level. Overall, the industry is expected to continue having a positive impact on the local and federal economy. Gen Z and Millennials make up the highest proportion of cannabis industry investors as well as cannabis product users.

Best Cannabis Stocks of June 2024

The Certified Public Accountant should have attended specific industry training or completed continuing professional education (CPE) courses. The CRB should consider how much CPE and how recently the Certified Public Accountant attended the CPE. The CRB should consider how many other cannabis clients the accountant already serves or will take on. Finally, the CRB may want to consider how the Certified Public Accountant will be able to assist as the cannabis business matures.

Four indicated that the special tax requirements and nuances with the tax code were not worth the extra technical training necessary to service what would be a niche industry. In addition, three worried that serving CRBs would jeopardize their Certified Public Accountant license. Table 4 shows the counts and percentages of Certified Public Accountants responding to the primary reasons they would not serve the cannabis industry. Though the cannabis industry is growing and its use is becoming more accepted in society, it faces major challenges.

• It is a non-intoxicating compound and is popularly used in various medical applications such as seizures, anxiety, and pain.
• The defense lawyer minced no words as he addressed a room full of plastic-industry executives.
• Hemp products became federally legal with the passage of the Agricultural Improvement Act of 2018 (2018).
• The Colorado Board went on to caution Certified Public Accountants that their Position Statement does not constitute an endorsement for Certified Public Accountants to enter the industry (Colorado Board of Accountancy 2015).
• We have also excluded any companies that generated sales under $50 million last year.

This growth in addition to plans for continued expansion means potential upside for the stock. Given its youth, Verano Holdings’ track record is thinner than most—all the other stocks on this list have displayed three years of positive and growing revenue. The greater risk profile may be attractive to some, however, and its revenue growth https://www.bookstime.com/ in 2022 was the third highest on this list. North of the border, Canada legalized marijuana across the nation in 2018, which has allowed many publicly traded American cannabis companies to list their shares on Canadian exchanges. Marijuana investing isn’t for everyone, especially for retail investors who prefer to minimize risk.

Various key insights provided in the report are the overview of related markets, recent hemp industry developments such as mergers and acquisitions, the regulatory scenario in key countries, and key industry trends. The global market remains highly competitive and robustly dynamic – new partnerships and expansions are underway as the wave of legalization spreads gradually medical marijuana accounting across the globe. Recreational consumption is also expected to attain multi-faceted patterns among younger consumers, taking higher risks for trying out different forms and versions of the product. Thus, the robustly expanding popularity of recreational utilization is creating a shift from flowers/buds to more processed formats such as edibles, oils, and topical products.