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Statement 102 is a vehicle many organisations use to implement their Ownership strategy. TFM Magazine unpacked this ownership option in issue 24 Statement 102 | Conventional vs Unconventional.

Q | The dtic’s Q&A delves into Statement 102 under Statement 100 and addresses:

o Point, 4.1.3, does it matter how the ‘Black’ Participants fund a transaction? For example, would it form part of the Net Value calculation if they took a private loan?

A | Any loan constitutes a third-party right to the shareholding and should account as part of the Net Value calculation.

o Point 6.1.2, is it correct that the value finalised in year three will be taken forth year-on-year? In other words, can an organisation recognise the Sale of Assets going forward?

A | Yes, after year three, the value is finalised and taken forward.

o Point 5.6.4, “the rights of Ownership in the Equity Instrument are comparable to rights that would have accrued had the sale or transaction taken place at seller level”. The understanding of this point is that one must treat the Sale of Assets as a sale of shares to an individual ‘Black’ Shareholder. An asset's value against an organisation's value will be equivalent to a ‘Black’ shareholder buying shares in an organisation.

A | An organisation must treat the Sale of Assets like it does the sale of shares to an individual ‘Black shareholder.

o Point, for the three years, can a ‘Black’ Participant drop a B-BBEE Status Level or do they have to maintain their B-BBEE status at the time of purchase for the points that will be recognised at the time of an organisation's B-BBEE Verification?

A | No, the B-BBEE level has no impact on the calculation.

Ownership Services are versed and on hand to assist members in implementing their Ownership strategy using Statement 102.

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