Scott & Scott, LLP represents clients in Microsoft software audit matters conducted by the BSA and Microsoft SAM consultants. Microsoft audits its customers using a variety of strategies. Small to medium-sized firms are frequently the target of a Microsoft audit initiated by a trade group such as the BSA. For large enterprise and mid-market firms, Microsoft audits its customers through its software asset management partner channel in what is frequently referred to as a Microsoft Software Asset Management (“SAM”) engagement.

Software Asset Management engagements are usually conducted by third-party auditors or consultants, but there is no obligation that the auditor in a SAM engagement be independent. Microsoft will request that the target allow a third party to audit its software installations and report the results directly to them. In these engagements, the target is required to purchase licenses to cover any deficiencies in its software licenses. Microsoft’s SAM engagement has been extensively used in lieu of traditional software audits with mixed reviews from the end user’s perspective.

If you license Microsoft products via the Services Provider License Agreement, the agreement typically includes audit rights language giving Microsoft the ability to review a SPLA partner’s records regarding software deployments and entitlements and to demand compensation – usually at a mark-up over standard reseller pricing levels – for any deployments found to be in excess of the business’ past monthly SPLA reporting. Businesses that deploy Microsoft software under one or more SPLAs should strongly consider working with an attorney experienced in Microsoft software audits before disclosing any information to Microsoft in response to a SPLA audit engagement.

Our lawyers and technology consultants also assist companies conducting an internal Microsoft audit for license true-ups, compliance initiatives, outsourcing contracts, and in connection with acquisitions and divestitures.

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