The Specter of Software Audits: Assessing Risks and Keys to Preparation

Software audits have become an increasing challenge for businesses as software publishers look to the discovery of customer non-compliance with software license terms as a major source of revenue. Buyers who lack effective software asset management face numerous pitfalls and commonly fall out of compliance with current licensing practices. The stakes are substantial, as software publishers can assess multi-million dollar penalties for discovered non-compliance, with a few cases reaching the level of hundreds of millions. While most software buyers act in good faith, non-compliance can arise inadvertently or through the behavior of naïve or unscrupulous employees.

In this environment, awareness of the growing risk of software audits and the ability to identify and mitigate specific risk factors and prepare for and respond to a software audit is imperative.

This ISG white paper examines why software vendors are expanding their use of audits, factors contributing to non-compliance with licensing agreements and events that frequently trigger an audit. The author focuses on defining proactive steps executives can take to formulate an audit response strategy built on an effective approach to contracting, licensing and asset management.

meet the team