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"Helping EMEs with their affadavits, and QSE/GSE with advisory services."


    The Broad-Based Codes of Good Practice were launched in 2007 and provide a framework for measurement of Broad-Based Black Economic Empowerment (BBBEE) in terms of the BEE Act 53 of 2003. On 11 October 2013 an amendment to the codes was published.

    The amended codes included a transitional period during which companies could prepare for measurement under the amended codes. The original transitional deadline was 12 October 2014. This deadline was extended on 18 March 2014 to 1 May 2015. Effectively, all measured entities must use the amended codes as a basis for measurement.

    The amended codes apply to Exempt Micro Enterprises (EME), Qualifying Small Enterprises (QSE), and Generic Sized Entities (GSE).

    EME's old codes vs new codes

    In terms of the previous codes, EMEs were required to obtain an EME certificate from an accounting officer stating whether the EME did in fact qualify as such.

    The new codes, effective from 1 May 2015, state that verification as an EME is no longer dependent on obtaining a certificate issued by an accounting officer. The thresholds determining whether an entity qualifies as an EME has also been amended.

    Under the new amended codes an EME is only required to obtain a sworn affidavit from the owners/manager on an annual basis confirming the following:

    • Annual total revenue of R10 million or less
    • Level of black ownership

    Any misrepresentation in terms of the above constitutes a criminal offence.

    Under the new codes any enterprise with an annual turnover of R10 million or less qualifies as an EME.

    An EME is deemed to have a B-BBEE status of level 4, with contributors having a B-BBEE recognition level of 100%. However, an EME that is 100% black owned qualifies for elevation to a level 1 contributor, having a B-BBEE recognition level of 135%. An EME that is at least 51% black owned qualifies for elevation to a level 2 contributor having a B-BBEE recognition level of 125%.

    Verification of QSEs and GSEs

    Verification of QSEs and GSEs may only be performed by either a South African National Accreditation System (SANAS) accredited verification agency or an Independent Regulatory Board of Auditors (IRBA) accredited auditor. Accounting officers may not issue verification certificates for these types of entities.

    The opportunities for BAP(SA)s

    A BAP(SA) may assist a client seeking assistance with obtaining an EME affidavit and additional confirmation by acting as a Commissioner of Oaths.

    As from 1 May 2015, EMEs were able to submit an affidavit attesting to its EME status. This affidavit must be taken in front of a Commissioner of Oaths. SAIBA members with the designation Business Accountants in Practice (SA) are recognised as Commissioners of Oaths and may therefore assist clients in this manner.

    A BAP(SA) may also, subject to the necessary experience and expertise, provide QSEs and GSEs with BBBEE advisory services. Alternatively refer your larger BBBEE clients to one of our Strategic Alliance partners.

    What SAIBA needs to do

    SAIBA is a legislative controlling body for accountants, accounting officers and independent reviewers. As a controlling body we are required to monitor and sanction compliance to standards of member conduct. We perform this function by ensuring compliance by our members to the IAASB’s engagement standards. We perform this function by requiring members to stay up to date with the latest developments in this area. We offer CPD and training courses to help guide members with their everyday challenge in the workplace. We lobby government and SME associations to allocate work to business accountants.

    What you need to do

    • Know and understand the various laws and regulations related to BBBEE. The firm should study any relevant laws, regulations, founding documents or contract terms to determine the qualifications of the persons required to perform the engagement, prior to performing the engagement.
    • Advisory and verification services: Inform EMEs, QSEs, and GSEs that they cannot obtain advisory and verification services from audit or other firms. Providing both advisory and verification services to the same client is unethical and may be prohibited due to the audit independence requirements.
    • Free services: Contact EMEs and offer your free commissioner of oath services for their EME certificates.
    • Paid for services: Contact EMEs and offer to confirm ownership and turnover. This additional confirmation performed by the BAP(SA) must be performed in terms of ISRS 4400 and can be charged for. The BAP(SA) does not issue a BBBEE certificate as the EME is exempted from obtaining a BBBEE certificate as only a EME affidavit is required. The ISRS 4400 report is a factual findings report that a client my request from the BAP(SA) and does not form part of the BBBEE codes or regulations and has no binding effect. The report issued in terms of ISRS 4400 may not refer to the BBBEE level and only reports on the turnover and ownership of the entity. The consultant is not allowed to use own stationery when assisting a client to complete an affidavit, the template on The DTI’s web site are the only legal form of affidavit that is allowed for B-BBEE. The consultant is not allowed to complete the Affidavit for a client and must follow the rules applicable to Commissioner of Oaths when commissioning an affidavit for a client.
    • Paid for services: Advisory: Contact QSEs and GSEs and offer your BBBEE advisory services to help them structure their companies in line with BBBEE codes.
    • Verification working papers: If the QSE or GSE require a verification certificate, a BAP(SA) can assist with the preparation of the verification audit file. The BAP(SA) cannot issue or perform the verification certificate.
    • Strategic Alliance: Refer the QSE or GSE to a SAIBA approved verification agent referral firm. This reduces costs and maintains independence as the verification agent cannot perform bookkeeping and accounting work for QSE or GSE clients. 

    Additional resources

    SAIBA has provided a number of guides, videos and PowerPoint slides that will assist accountants with understanding their responsibilities in terms the various types of engagements: