SOP-100.000.210

📅 End of Month Routine

Monthly Financial Close, Cash Reconciliation, Reporting & Compliance Verification

Version
v2.0
Effective
April 2026
Owner
Tim Clark
📋 Purpose

This SOP provides standardized procedures for the end-of-month financial close routine at all Red Run Cannabis retail locations. The monthly close ensures accurate financial records, proper cash reconciliation, and compliance verification.

Completing the EOM routine accurately and on time is critical for:

  • IRC Section 280E tax compliance
  • Accurate financial reporting to ownership
  • Cash flow visibility across all entities
  • Audit-ready documentation
📆 Monthly Timeline
Last Business Day of Month

Complete all daily sales entries, shift drops, and outstanding bill entries

1st - 3rd of New Month

Full cash reconciliation, bag counts, and variance analysis

By the 5th

Submit EOM report to Tim Clark and Marc Theiler

By the 10th

All corrections and adjustments finalized

💰 Cash Reconciliation Checklist
  • Count all 5 bags — document actual vs. expected
  • Verify Bag #1 (Sales Tax) matches Dutchie tax collected
  • Verify Bag #2 (280E) matches 15% of net revenue
  • Verify Bag #3 (Payroll) is at or above $15,000 target
  • Verify Bag #4 (Overhead) is at or above $6,000 target
  • Reconcile Bag #5 (COGS) against vendor payment records
  • Document any variances with explanations
  • Photograph all bag count sheets
  • Upload to CannaOps → EOM → Cash Reconciliation
⚠️ Variance Threshold: Any single-bag variance exceeding $100 or total variance exceeding $250 requires immediate escalation to Tim Clark with written explanation.
📊 QuickBooks Verification
  1. Run P&L report for the month (your location only)
  2. Run Balance Sheet as of month-end
  3. Verify all daily sales entries are posted
  4. Verify all vendor payments are recorded
  5. Check for any uncleared transactions
  6. Verify bank reconciliation is current
  7. Review accounts payable aging
  8. Export reports to PDF and upload to CannaOps
✅ Compliance Verification
ItemCheckEscalate If
METRC InventoryMatches physical countAny variance
Distru TransfersAll accepted within 72hPending transfers
Sales TaxCollected = Dutchie report>$50 variance
280E Set-Aside= 15% of net revenueUnderfunded
Business LicenseCurrent and displayedExpiring <60 days
📝 EOM Report Submission

The EOM report must include:

  • Cash Reconciliation Summary — All 5 bags with variances explained
  • P&L Report (PDF) — Month-over-month comparison
  • Balance Sheet (PDF) — As of month-end
  • Compliance Checklist — All items verified
  • Issue Log — Any problems encountered with resolution status
Submit via: CannaOps → Reports → EOM Submission
Recipients: Tim Clark, Marc Theiler, Charlene (CC)

📝 Knowledge Check

Complete the quiz to verify your understanding of SOP-210.