Software Audit Settlement Agreement

Most initial draft transaction agreements require the audit objective to rehabilitate unaccompauthorized software within 30 days and provide documentation within 45 days. However, many companies are not able to meet such a tight deadline, as a number of reasons range from an expansionary and dynamic environment to a lack of sufficient resources after high compensation. If the software provider intends to ask the licensee to run certain scripts or other tools, appropriate arrangements must be made to ensure that the level of the test is met. This is all the more important since the licensee cannot in principle compel the licensee to execute scripts or use tools if this has not been the subject of a contractual agreement. When vendor software audits become ugly and the most pessimistic scenarios become a reality, CIOs need a game plan to minimize damage. That`s where to start. Taking control of settlement negotiations and putting your rebuttal in writing is the key to getting what you want, says Scott. Software licensing audit clauses do not always describe the licensee`s obligation to cooperate. In order to avoid any misunderstanding and discussion, it is recommended that the licensee`s co-operation obligations and, more generally, the terms and procedures of the review be agreed from the outset. However, once all data collection and licensing tasks have been completed, IBM auditors will prepare a final audit report and IBM will develop a proposal to regulate audit results. At this stage, companies must focus on structuring an appropriate comparison framework that will definitively address all calculated licensing gaps and any underlying licensing issues that could have contributed to an imperfect outcome. First of all, don`t ignore the audit request! After receiving an audit letter, whether it is a software provider or a group of companies acting on behalf of the software provider, you should immediately work with your legal advisor, IT manager and internal software management team, as well as any additional internal manager responsible for the product in your organization, to verify and understand your audit rights and obligations and develop an action plan.

Legal advisors will review the relevant audit provisions to determine your contractual audit rights and obligations. Difficulties can arise when the licensee and the licensee interpret the metrics differently, especially for older licensing agreements, the text of which may be obsolete, and which must be applied to new technologies and interfaces in a way that was not expected when the contract was first signed.

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