Cannabis bookkeeping: excise ledgers, AGCO reports, and counts that must agree

Retail and production run on different rulebooks

An AGCO-licensed retailer and a Health Canada-licensed producer keep very different books, and the chart of accounts has to be built for the licence you actually hold. A retail store has one legal supplier in Ontario — the Ontario Cannabis Store — a POS system at the centre of everything, and monthly regulatory data submissions to the AGCO. A licensed producer or micro-cultivator carries a CRA cannabis excise licence on top of the Health Canada licence, which means a duty ledger, stamp inventory, and a monthly duty return. Some operators hold both sides, and then the books need clean segment reporting so retail margin and production cost never blur together.

The excise duty ledger is the heart of producer books

For producers, duty under the Excise Act, 2001 becomes payable when product is delivered to a purchaser — so the liability accrues from shipment records, not from when the invoice gets paid. The duty on most products is the higher of a flat per-gram amount and a percentage of the dutiable amount, with provincial adjustments layered on through the coordinated framework, and it all lands on the monthly B300 Cannabis Duty and Information Return. We build the accrual so each month's B300 is a report from the ledger rather than a spreadsheet reconstruction.

Excise stamps deserve their own line of respect: they are serialized, province-specific, and controlled. We track stamp purchases, usage, and spoilage like a cash count, because CRA expects stamps on hand plus stamps applied to reconcile to stamps bought — a gap there is a compliance problem, not a rounding error.

AGCO and OCS: the retailer's monthly paper trail

Ontario retailers submit monthly sales and inventory data to the AGCO, which feeds the federal cannabis tracking framework — and that submission has to agree with the POS, which has to agree with the general ledger. Cannabis-specific POS platforms such as Cova and Greenline are the source of truth for sales by category, so we reconcile POS totals to bank deposits and card settlements before anything is filed. On the purchasing side, OCS invoices, delivery discrepancies, and credit notes for shorted or damaged product need to be matched line by line — an unclaimed OCS credit is real money, and an unmatched one distorts your cost of goods.

Seed-to-sale counts have to match the ledger

The tracking trail — what came in, what sold, what was destroyed — is only defensible when the physical counts, the POS, and the general ledger inventory agree. Shrink in cannabis cannot stay anonymous: destruction events need documentation and a matching write-off entry, display and sample product gets relieved from inventory at cost, and theft or count variances get booked the month they are found. A retailer who lets inventory drift for two quarters is simultaneously misstating margin to themselves and filing regulatory data that will not survive a store audit.

Cash still moves through this industry more than most, and banking options remain narrower than for an ordinary retailer. We keep daily cash-over-short tracking by till, deposit logs that match POS cash totals, and a paper trail that makes the cash side as auditable as the card side — because in cannabis, sloppy cash records raise questions with two regulators at once.

Margins by category, then the close

Flower, pre-rolls, vapes, edibles, and accessories earn very different margins, and accessories are the quiet outlier — no excise stamp in the supply chain and typically the best markup in the store. We report gross margin by category monthly so buying decisions follow the numbers, then run the close: POS to bank, OCS settlements matched, excise and HST accrued, inventory trued to counts, all in QuickBooks Online with documents through Dext. One caution belongs in every cannabis owner's file: US expansion drags you into the American 280E regime, where ordinary deductions disappear — we cover why in our cannabis cross-border tax guide, and the full monthly routine lives on our bookkeeping services page.