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How to dissect the earnings of marijuana producers Add to ...

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A quick look at the results of some of Canada’s emerging cannabis companies shows some remarkable profitability for early-stage businesses. But a deeper dive into the financials shows the companies’ results are more complex to assess than at first blush.

The culprit, if you will, is that Canadian public companies, both on the TSX and Vancouver’s venture exchange, use International Financial Reporting Standards (IFRS). And these accounting rules have special requirements for natural resources – such as marijuana plants – that can greatly skew the companies’ bottom-line profitability.

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