Broad-Based Black Economic Empowerment Act, 2003 (Act No. 53 of 2003)

Industry Charters

Chartered Accountancy Charter

Section C From Theory to Practice: The Scorecard

12. The Generic Scorecard for the CA Sector

12.2 Application of the CA Sector Scorecard

12.2.3 The Employment Equity Scorecard

Purchase

The objective is to measure initiatives targeted to achieve equity in respect of all Measured Entities (CA sector) in the workplace in terms of the Act and the EE Act.

The aim of the Employment Equity Element is to address certain key issues surrounding the representation of black Employees as well as black Employees with disabilities, in the workplace.

In order to contribute to the achievement of the vision of the CA Sector Code and based on sound economic principles, sectoral characteristics and empirical research in line with the principles set out in paragraph 11.3, five additional Weighting points were allocated to the Employment Equity scorecard.

In addition the compliance Targets were amended to reflect more realistic targets for the CA sector. This is based on actual trainee and university statistics (see the 'pipeline' statistics in appendix 4), which substantiate that the gazetted Targets cannot realistically be achieved based on 'students' in the pipeline and the time it takes before a student is able to take up a position within the CA sector.

For purposes of this section the indicators and Weightings shall be as follows:

Employment Equity indicators		Weighting points		Compliance Target
				For 2011		For 2016
		Code	CA sector	Code	CA sector	Code	CA sector
(a)	Black Disabled Employees as a percentage of all Employees using the adjusted recognition for gender	2	2	2%	2%	3%	3%
(b)	Black Employees in Senior Management as a percentage of all such Employees using the adjusted recognition for gender	5	6	43%	40%	60%	50%
(c)	Black Employees in middle Management as a percentage of all such Employees using the adjusted recognition for gender	4	6	63%	50%	75%	60%
(d)	Black Employees in junior Management as a percentage of all such Employees using the adjusted recognition for gender	4	6	68%	60%	80%	70%
Bonus points
For meeting or exceeding the EAP Targets in categories (b) to (d) above		3	3

For purposes of the CA sector, indicator Weightings have the following definitions:

•	When calculating the score under this section Measured Entities must, where possible, use the data that it files with the Department of Labour under the EE Act. This has been included to encourage entities to avoid duplication of data collection for B-BBEE reporting purposes.

•	If a Measured Entity is exempt from filing such returns, then it must complete its data using the guidelines set out in the EE Act.

•	As the EE Act seeks to encourage companies to meet the Economically Active Population (EAP) Targets, the Codes have also embedded this principle as a Target toward which Measured Entities should be aspiring.

•	The Codes require that a Measured Entity should only start being allocated points on its EE scorecard provided it achieves a minimum of 40% of its Target in each measurement category.

•

This implies that for a Measured Entity to obtain points in the Senior Management category it would have to meet a minimum of 40% of its Target of 43% in each of the first five years of application of the Codes. Therefore at least 17% of the Employees of a Measured Entity at Senior Management level must be Black People, using the adjusted recognition for gender, before it can start scoring points in that occupational level.

•	The same principle would apply to other categories.

•	If the organisation structure of a Measured Entity does not distinguish between middle Management and junior Management, it can consolidate these categories against the Targets for junior Management. The Weighting points will be adjusted as follows:

o	Senior Management 10 points

o	Junior Management 8 points

•	The bonus points will be apportioned equally between these two categories as 1,5 each for exceeding the EAP Targets.

•

Senior Management level means a senior audit manager / principal consultant in a practice, whose role is to manage either client and / or certain administrative functions. This is the person, who would generally have 5-10 years' relevant experience, who would be entrusted with large or key accounts or responsibilities in an administrative or support function.

•	Middle Management means the equivalent of a manager, assistant manager or senior consultant who has at least 2-4 years' relevant experience and is entrusted with a supervisory or managerial role. In the audit context it would involve the senior on the assignment.

•	Junior Management means all employees not defined as senior or mid-Management. In the audit context it would comprise all trainee accountants and other consultants and practitioners in other divisions.

Measurement of the economic Employment Equity indicators

Calculate the adjusted recognition for gender as per paragraph 12.2.

Measurement of the Employment Equity indicators

Where A = score for the measured category indicator

B = adjusted recognition for gender

C = Target for that measurement category

D = Weighting for the measured indicator

Bonus points

A Measured Entity will be allocated bonus points for meeting or exceeding the EAP Targets in the Senior, middle and junior Management levels of the scorecard (except for the disabled (a) category). Each occupational category will be allocated a bonus point if the Target is met.