A royalty audit is usually carried out on behalf of the owner of an intellectual property asset, whether in the form of patents, brands, know-how or show-how, which has been licensed to a third party licensee in exchange for payments based on usage (usually called “royalties”). A royalty audit, in brief, is used to check that the licensee is paying the correct royalties.

It’s important that any company engaged in licensing-out IP assets ensures that royalty audits and brand licensing audits are regular features of their licensing strategies, and are incorporated into every licensing agreement.

Our royalty audits ensure that our clients’ financial interests are protected by helping to manage the risk of underpayment and providing recommendations about how a licensee can improve their compliance with a licensing agreement for their benefit as well as that of the licensor.