The Chartered Accountancy (CA) profession’s BEE Sector Code, part 3 – weighting and compliance targets of the scorecard
As has previously been stated, the vision of the CA profession Sector Code is to grow the number of Black People in the CA profession to reflect the country’s population demographics, to empower and enable them to meaningfully participate in and sustain the growth of the economy, thereby advancing equal opportunity and equitable income distribution.
To achieve this vision, based on the economic principles and sectoral characteristics, as well as the empirical research outlined above, the focus of the CA Sector Code needs to shift significantly towards skills development. Accordingly, ten additional weighting points were allocated to the Skills Development scorecard. To balance the CA Sector scorecard, ten weighting points were then removed from the Enterprise and Supplier Development scorecard, as this is not an area in which the CA Sector can make significant contributions based on the nature of its business. As a result, the weighting points per the Codes of Good Practice compared to the CA Sector Code for Large Enterprises are as follows:
Table 1
WEIGHTING
Table 2
B-BBEE RECOGNITION LEVELS
Enhanced recognition for certain categories of Black People:
- Black females should form between 40% and 50% of the beneficiaries of the relevant Elements of the Scorecard.
- Black People with disabilities, Black youth, Black People living in rural areas, and Black unemployed people should form part of the beneficiaries of the relevant Elements of the Scorecard.
INDICATOR WEIGHTINGS
In addition to the weighting points assigned to each Element, the Codes of Good Practice have attached weighting points to different Indicators within each Element. The main reasons for these Indicator Weightings are to make the B-BBEE scorecards for different entities and sectors easier to understand and interpret, as well as allow a comparison of progress across sectors and industries while working from an equitable baseline.
Based on the reasons set out above, the CA Sector has adjusted the recommended Indicator Weightings of the Codes of Good Practice to take account of the unique conditions of the CA Sector and the advantages such an adjustment would have in the long run.
COMPLIANCE TARGET
The CA Charter recognises that many Firms practice as Professional Partnerships and not Incorporated Entities. The inclusion of alternate targets based on Turnover was motivated to accommodate this. Turnover should be used where a Professional Partnership is included in Affiliated Entities, whilst Net Profit After Tax (NPAT) should be used where Incorporated Structures are included in Affiliated Entities. If a firm made a loss, Turnover will automatically be used to calculate the required spend.
The next article will discuss the Generic Scorecard of the CA Sector.
