Broad Based Black Economic Empowerment Act, 2003 (Act No. 53 of 2003)Codes of Good Practice on Black Economic EmpowermentCode Series 500: Measurement of the Preferential Procurement Element of Broad-Based Black Economic EmpowermentStatement 500 : The General Principles for Measuring Preferential Procurement5. Total Measured Procurement Spend |
The following procurement is measurable within Total Measured Procurement Spend:
| 5.1) | Cost of sales: all goods and services procured that comprise the cost of the sales of the Measured Entity; |
| 5.2) | Operational expenditure: all goods and services procured that comprise the operational expenditure of the Measured Entity; |
| 5.3) | Capital expenditure: all capital expenditure incurred by the Measured Entity; |
| 5.4) | Public sector procurement: all goods and services procured from organs of state and public entities listed in Schedules 2 and 3 to the Public Finance Management Act of 1998; |
| 5.5) | Monopolistic procurement: all goods and services procured from suppliers that enjoy a monopolistic position; |
| 5.6) | Third-party procurement: all procurement for a third-party or a client where the cost of that procurement is an expense recorded in the Measured Entity's annual financial statements; |
| 5.7) | Labour brokers and independent contractors: any procurement of the Measured Entity which is Outsourced Labour Expenditure; |
| 5.8) | Pension and medical aid contributions: payments made to any post retirement funding scheme or to a medical aid or similar medical insurer by a Measured Entity for its employees, excluding any portions of such payments which are a contribution to a capital Investment of the employee. The scheme or insurer must issue a certificate dividing payments between the capital investment portion and the balance to establish the amount that is measurable within Total Measured Procurement Spend; |
| 5.9) | Trade commissions: any commissions or similar payments payable by a Measured Entity to any other person pursuant to the business or trade of the Measured Entity; |
| 5.10) | Empowerment related expenditure: all goods and services procured in carrying out B-BBEE. The Total Measured Procurement Spend does not include the actual contribution portion recognised under Code series 600 or 700 but does include any expenditure incurred in facilitating those contributions; |
| 5.11) | Imports: all goods and services that are imported or procured from a non-South African source; and |
| 5.12) | Intra-group procurement: except as provided in statement 002, all goods and services procured from subsidiaries or holding companies of the Measured Entity. |