“By failing to prepare, you are preparing to fail.” These eight words by Benjamin Franklin summarises the basic fundamentals of your BEE certificate. To be compliant, be it a level 1 or a level 8, you need to get your ducks in a row before the last day of your financial year.
The Companies Act, in Section 30, demands the Annual Financial Statements of a company to follow its Financial Year-End. The Verification Manual prescribes the Audited Financial Statements to be used across the verification of several elements:
- Ownership;
- Skills Development;
- Preferential Procurement;
- Enterprise Development;
- Socio-Economic Development.
For a Company to be BEE compliant, it needs to ensure that its specific targets are met in each of the elements mentioned above.
It is important that a company plans throughout their financial year and ensure that their BEE process is handled by a person in a position of authority.
What we’ve noticed in practice is that most measured entities wait for their current verification to be finalised and to have their BEE certificates in hand before they start planning for the next certificate. Sometimes this might be too late, they are not just shorting the time frame to plan and act for the next certificate, but sometimes the workload is too big to finalise everything in time.
The best time to start planning for your BEE certificate is the start of your current financial year; this is to ensure that you are confident you have done everything to be compliant by the end of the current financial year.
Try setting quarterly targets for yourself. For instance, when it comes to training, calculate your Payroll (Leviable Amount) every three months by using the last three months’ SDL amounts. You can use this to determine if your training expenditures are up to date, if not, you can quickly fill the gap.
Actions like this will ensure you are up to date with your planning to stay on target as your financial year creeps closer.
Contact your SEESA BEE Legal Advisor to assist your business with any BEE Certificate related queries you might have alternatively, SMS the word “SEESA” to 45776 for an expert legal advisor to contact you.
About the Author:
Lourens Odendaal is currently a Legal Advisor at the SEESA George branch, specialising in Labour Law and BEE. He obtained his LLB at the University of the Free State, where after he completed his articles and was admitted as an Attorney in the High Court of South Africa, Free State Province.
Resources:
- https://www.forbes.com/quotes/1107/
- Section 30 of the Companies Act, Act 71 of 2008
- B-BBEE Act, No. 53 of 2003: Framework for Accreditation and Verification by all Verification Agencies