Understanding the risks of non-compliance

Before reviewing the steps that need to be taken in the event of an unwanted software audit, enterprise leaders should be aware of the risks involved. There is nothing fun about a software audit and the best an enterprise can hope for is that it is in compliance, so that mostly the enterprise's time was drained. At worst, an audit may find an enterprise out of compliance, which carries significant costs in time, monetary penalties, possible third-party legal and IT fees, and potentially additional software expenditures. Unless a company can prove otherwise, the assumption is that every infringement was willful, and penalties of up to $250,000 in statutory damages can be charged for each infringement. Furthermore, the costs can also include the recovery of the software vendor's attorneys' fees under 17 U.S.C. §505 of the Federal Code. In large organizations, these costs can add up to millions of dollars in a hurry.

Beyond the direct financial costs...