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Definitions & FAQ's

Glossary of terms and definitions
Outsourcing and Offshoring	When a company relocates business processes that it used to perform in-house: Outsourcing occurs when it uses the third party providers to perform these activities/ services, and/or Off-shoring occurs when these activities/services are performed in a foreign location.
Types of business processes that can be outsourced or offshored include but are not limited to the following categories:
	Finance and Accounting Services (E.g.: Accounting Services, Accounting Preparation and reconciliation, Asset management, Corporate Claims Processing, Loan Application processing, Portfolio analysis & management, Financial reporting, Treasury & financial management, Tax Consulting & Compiling, Tax management, Auditing), Human Resource Functions (E.g.: Compensation & payroll administration, Recruiting and termination, Education, Training & Development), Contact centers (E.g.: Inbound customer service, Inbound helpdesk, Inbound sales, Inbound Technical support, Outbound Data cleaning & Data Capturing, Outbound debt collections, outbound customer interview, research & surveys, Outbound telemarketing/sales, Web sales & marketing, Advertising-Creative processes, Marketing Research Services), Back Office Processes (E.g.: Administration, data entry/preparation, Data entry - scanning & archiving, Document management, Translation & Transcription service, Forms and report generation), IT and Technical Services (E.g.: Network management & maintenance, Software development & maintenance, Web site design & development, Network maintenance, Data Conversion, -Entry, -Scanning, -Administration and -Maintenance), Other Specialist Services (E.g.: Engineering & Design, Asset Management, Infrastructure management, Logistics and fulfillment, procurement, transportation services, travel & Tourism booking & reservations, Translation and Transcription Services, Insurance Industry Functions).
Offshore client	A client located outside South Africa, contracted to have its activities/services performed/rendered by a BPO/O operation located within SA.
Date of commencing operations	Date on which the entity/project starts performing or rendering the offshored/outsourced service(s), e.g. handling calls. The entity must have the facility and agents on site, to be able to perform transactable services for the applying project.
Financial year end	The last month of the financial year of the entity. This month will correspond with the last month of the Audited Financial Statements
Commencement date of claims	Entity has the following options/choice regarding commencement date of claims: On the first day of a calendar month, where this date is the same as the commencement date of operation OR the first day of the month immediately after the commencement date of operations if the production did not commence on the 1st of a month, OR on the first day of the first full financial year after the commencement date of operations.
Claims period/ "incentive period "	The entity may qualify for incentives for a maximum period of 3 years. The claim period commences on the commencement date of claims and ends on the last day of the third financial year-end thereafter.
Seats	Refers to operating facility/ desk used by an agent. Seats are used as an equivalent measure for a capacity size of a BPO/O operation. For a 24-hour operation, it is possible to have 'hot seats' i.e. where one seat is used/ occupied by 3 agents, each working an 8-hour shift. For purposes of this programme, seats are calculated as average number of seats i.e. the active seats for each month divided by the number of months applicable for a claims period.
Employees	Refers to the total staff complement employed by an applying project and engaged in the operations. This will include agents, management and support staff. For purposes of this programme, this is calculated as average number applicable for a claims period.
Agents	Refers to 'full-time equivalents' employees occupying the seats/ operating facility, handling calls or rendering services regarding the outsourced/offshored service. Full-Time Equivalents refers to agents working an equivalent 45 hours per week, considering the provisions for 'compressed working week' and 'averaging of working hours' detailed in the Basic Conditions of Employment Act (BCEA) 1997 as amended, as amended (i.e. Hours worked by part time work or contract work 'Agents' will be calculated to constitute full time equivalents applicable for the claims period. For purposes of this programme, number of agents will be calculated as average number applicable for a claims period.
New employment creation	Additional new employment created, of full-time equivalents of 'agents' directly working on the project.

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FAQ’s – BPO Government and Assistance Support Programme (Incentives)
Question	Answer
When does the application process begin?	The process is now open, effective 6 December 2006
If I have applied for another grant from dti, am I eligible?	If you are currently the recipient of an incentive such as the previous SMEDP (Small Medium Enterprise Development Programme), you do not qualify for the investment incentive
What is the benefit for a project to apply?	The programme comprises an Investment Incentive grant and a Training Support grant.
What is the minimum number of seats I must have to qualify?	At least 100 seats and 200 new jobs
What are the minimum eligibility requirements for the grant?	Minimum eligibility for a qualifying applicant is that the applicant must be a registered legal entity within South Africa and a taxpayer in good standing. There are a range of eligibility criteria for qualifying projects. These can be found on Page 4 of the Programme Guidelines for each Incentive
Is the grant taxable?	The grant is exempt from tax. However, specific qualifying activities will be subject to VAT. Queries around this can be submitted to the dti
Where do I submit the application forms?	Application forms may be submitted via registered mail, courier or hand delivered, to: Programme Manager: BPO&O Incentives Postal address: The Enterprise Organisation Private Bag X86 Pretoria, 0001 Physical Address: the dti Campus 77 Meintjies street Sunnyside Pretoria, 0002
Is the grant only open to BPO service providers?	The investment project must operate activities classifiable as that of business process outsourcing and offshoring and must generate at least 90% of its revenue from activities that service offshore clients. An exception to this requirement is however applicable to operations that have been in existence and operating in South Africa before 01 April 2006, wherein a minimum threshold of 70% offshoring activities can be accepted.
Is the grant open to domestic and international investors?	Yes it is, as long as they qualify, according to the Programme Guidelines
How long does this programme scheme last?	The scheme will be implemented from 6 December 2006 to March 31 in 2011
How is the grant calculated?	Please check page 5 of the Programme Guidelines for the Investment Incentive Grant and on page 6 of the Training Support Grant.