Software audits have increasingly become a threat to companies and their brands, usually because of unintentional violations of complex software license user agreements.
When receiving a software audit, it is important to know how to respond to the audit notice without the possibility of exposing your organization to unnecessary risks. If you are expecting a software license audit, chances are you are most likely concerned with discovering that there are too many users for the license than the number of licenses purchased, or in other words, non-compliant.
Being non-compliant or under-licensed can cause a lot of problems, including additional costs and fines. Since a software audit can take months to complete, the impact of it on the organization is drastic, causing lots of time taken away from productivity.
Preparation for the Software License Audit
When a business receives an audit letter from the software vendor, usually it will give a notice period, ranging anywhere from 30 to 45 days. With that being said, there isn’t much time to completely be prepared for a full audit. Hopefully, with earlier anticipation, your company started a while ago.
Key Points To Think About When Responding
- While software vendors might have the contractual right to administer an audit, be sure to check to see if the software vendor’s demand is consistent with the contract’s agreed-upon audit conditions.
- It is important to keep a legal team involved from the beginning of receiving the audit letter. However, just because business and legal interests have been threatened does not mean you are required to have a legal response.
- There is always room for negotiation for more favorable conditions with the software vendor. Usually, software vendors are wanting to keep the relationship between them and your business.
Ways to Ensure Software License Compliance
- Be clear with terms and penalties within the contract
- Understand the definitions used in the user license
- Maintain procedures and policies for compliant software use
- Conduct internal compliance audits regularly
Benefits of an Internal Software License Audit
The two primary benefits of running an internal audit include prevention and optimization. An internal license audit helps a business establish if they are sufficiently licensed. This helps prevent being non-compliant and prevents any hefty fines. An internal audit will also show how software is being utilized throughout the business, which can help determine if licenses can be removed in order to save money.
Top Reasons Why Software Compliance Can Be Challenging
- License rights are becoming harder to interpret
- Cloud computing adds to the confusion
- The rise of multi-core processors makes things more difficult
Software audits are not something to get excited about.