Applicable Period of Qualifying Spend

There is some confusion as to which period the codes refer to, specifically for preferential procurement, enterprise development and CSI. When calculating spend do we use our latest financial year, or the calendar year, or a forecast of next year's spend?

Analysis

I have referred to codes 500, 600 and 700 as even if you are a QSE code 1000 says that when there is any confusion you should refer to the generic scorecard.

Enterprise Development and Corporate Social Investment

Extracts from code 600

"Inception Date" means a date specified by a Measured Entity as being the date from which its enterprise development contributions should be measured where that measured Entity has initiated such contributions prior to the commencement date of this statement. The Inception Date shall not be a date earlier than 5 years prior to the commencement date of this statement.

6.2 Qualifying Enterprise Development Contributions of any Measured Entity shall be measured cumulatively from the commencement date of this statement until the date of measurement

6.3 Notwithstanding paragraph 6.2, any Measured Entity that commenced making Qualifying Enterprise Development Contributions prior to the commencement date of this statement shall be entitled to designate an earlier Inception Date.

Similarly for code 700  - The same definition except refers to Corporate Social Investment contributions

For Enterprise Development and CSI contributions the starting time period is the release date of the codes. Currently the codes have not been released.

If the contribution is made before the starting period it can still be included. The calculation for contributions made more than 1 year ago is based on a moving average of the amount of money you have spent in relation to a percentage of your profits before tax (EBITDA), but you cannot go more than 5 years back.

Preferential Procurement

These are extracts from code 500

2.1 When interpreting the provisions of this statement, any reasonable interpretation which is consistent with the objectives of the Act and those set forth in paragraph 4 must be preferred over any other interpretation which is inconsistent with such objectives.

6.2 All procurement of goods and services by the Measured Entity, other than such portion specifically excluded in terms of this statement, is to be included in the calculation of Total Measured Procurement Spend of the Measured Entity.

(7.2 refers to exclusions to preferential procurement)

8.1 BEE Procurement Spend is calculated as the sum of the value of the Procurement Items not excluded in terms of paragraph 7.2 multiplied by the BEE Procurement Recognition Level of the Supplier.

The starting period should be a reasonable period taking into account all possible expenditures. For ease of calculation it would make sense to use the latest financial accounts.