How to Prepare for an Oracle License Audit

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Have you Been Hit with an Oracle License Audit Request?

If you’ve received a letter from Oracle License Management Services (LMS) or Global Licensing and Advisory Services (GLAS) then it’s time to prepare for an Oracle License Audit.

Receiving that letter may feel like a genuine cause for concern. After all, you’ve probably read the horror stories and perhaps it’s your organisation’s first license audit.

Even if isn’t and you’re a seasoned expert in Oracle Licensing, take a moment and remember that preparation is key to success.

From the initial request to implementing an Oracle License Audit Protection Strategy, here’s how to prepare for an Oracle License Audit.

Is Oracle Permitted to Perform a License Audit?

Yes they can, and are legally entitled to do so.   

After all, they own the rights to the software, much in the same way that Microsoft and IBM own the applications many companies use. 

Your company’s use of Oracle is license-based, similar to leasing a product. This means they’re entitled to protect their intellectual property by ensuring that their product is used in a compliant manner. 

Contrary to popular belief, an Oracle license audit is not conducted at random. They typically occur every 3-4 years, coinciding with a company’s system refresh. Like other software companies, Oracle knows that their customers sometimes let license renewals slip, change their business structure, or expand their internal systems.

Top 5 Triggers of an Oracle Licensing Audit

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Top 5 Triggers of an Oracle Licensing Audit

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The Software License Agreement (SLA) you’re signed up to clarifies that Oracle have a legal right to request an audit as and when they see fit. 

The license agreement acts as a contract between your company and Oracle, setting out that audits can – and will – take place at Oracle’s discretion. 

The SLA will also advise you on your compliance duties as a customer, your expectations during an audit, and the timeframe in which you need to respond.

Why Would Oracle Wish to Perform an Audit?

The driving force for Oracle when it comes to audits is to increase their revenue.

Business needs and structure inevitably change over time. Despite this, the impact on software agreements and their usage is not always considered in the planning.

It’s because of this that audits often uncover non-compliance – finding that usage is not in line with the agreed SLA. 

Therefore, without audits or reviews, Oracle misses out on revenue potential. It’s in their interest to look for opportunities to begin an audit.

What are the Main Triggers?

The common triggers for an Oracle License Audit include:

We have established the reasons and triggers for an impending audit. So, how do we manage the process effectively?

Assess Whether It’s a Formal Audit

Firstly, it is essential to determine whether the audit requested is a formal Oracle License Audit, or simply an informal discussion.

Oracle Audit Managers may recommend an “audit” to address potential gaps you may have in your licensing. At this point you are not about to have a full formal review.

Formal reviews will only ever begin with an official letter from the Oracle License Management Services (LMS) or Global Licensing and Advisory Services (GLAS). 

It is important to note that only License Management Services and Global Licensing and Advisory Services can determine if you are licensed correctly. 

It is not uncommon to receive letters from other departments within Oracle, or other letters from the LMS department, but these will not always be to notify you of an impending audit.  They can simply be enquiries.

Man deciding how to prepare for an Oracle License Audit

Assessing whether or not you’re faced with a formal audit is an important step.

However, it is important to react and respond to any requests or enquiries and take any necessary action, as these can be a precursor to a formal audit.  If you choose to partner with Xynomix we can help you to generate the correct response.

For the meantime, here’s a step-by-step guide on how to prepare for an Oracle License Audit.

How to Prepare for an Oracle License Audit
(Step-By-Step Guide)

Step One
Oracle requests a formal audit

When the Chief Information Officer (CIO) or Chief Financial Officer (CFO) receives a letter from Oracle with the audit demand, you must firstly establish the following:

Step Two
Assemble a strong team

Before the Oracle License Audit process commences, it is essential that you gather together a highly experienced team.

This team will typically consist of:

Regardless of your team composition, it is imperative that a consulting member of staff possesses extensive knowledge of Oracle licensing agreements and how Oracle license audits work.  

At this point, it is strongly advisable to consult an Oracle expert like Xynomix. Our extensive experience with Oracle license audits and can step in on your behalf.

Although outsourcing comes at an additional cost, the value of having a professional in the room means you will save you money in the long-run by setting up the best possible arrangement with Oracle and ensuring a smooth audit process.

Step Three
Preparing your documents

At the start of the Oracle license audit, you will be required to gather all ownership documents together. These include your SLAs (Software License Agreements), any renewal documents, and purchase agreements to demonstrate that you are the rightful owners. 

Oracle will always request this documentation prior to starting the actual audit process.

Step Four
Conduct your own audit

With the assistance of your independent database consultant, it is prudent for your team to assess your current licensing situation. Questions you’ll need to answer at this step include:

  1. Are you up-to-date with your licensing agreement?
  2. Are there any gaps in your cover?
  3. Have you uncovered any known instances of non-compliance?

At Xynomix, our independent database consultants tend to follow a process that closely mirrors Oracle’s own audit process, aiming to prevent any surprises by the time Oracle conducts their audit.

Knowledge is power, and with a thorough self-audit, you and your independent database consultant can determine the next course of action. 

This process should be done in strict confidentiality and limited exclusively to authorised personnel.

Step Five
Evaluate your results

At the start of the Oracle license audit, you will be required to gather all ownership documents together. These include your SLAs (Software License Agreements), any renewal documents, and purchase agreements to demonstrate that you are the rightful owners. 

Oracle will always request this documentation prior to starting the actual audit process.

Step Six
Devise a plan

Formal audits can be difficult and lengthy without an Oracle expert.

You may well be found to be under-licensed in some places and perhaps even over-licensed in others.

Oracle does have some discretion with what it finds to be compliant and non-compliant. This works on a case-by-case and business-by-business basis. 

This is where you see the benefits of working with an independent oracle license audit consultant.

Xynomix can begin the renegotiation process with Oracle, liaising on your behalf over any identified issues. We even saved a customer over £2.5 million in Oracle license audit non-compliance fees.

Experience counts, and this is why having an expert on-board to cooperate with vastly increases your chances of a successful oracle license audit.

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Overview

Remember, don’t panic.

Digest the information, consult your SLA, and contact an expert Oracle Licensing Audit partner. This is the most simple & effective way to prepare for an Oracle License Audit

We’ve got you covered – our experts are seasoned audit professionals with extensive Oracle License Audit experience. We can help with your license audit preparation and monitor Oracle usage to assist with ongoing compliance.

With assistance from Xynomix, you can stay one step ahead and find out how to prepare for an audit and avoid millions of pounds in potential violation fees.

From time-to-time Oracle will make changes to licensing rules and as a license holder, you are obliged to monitor and keep up-to-date with those changes. Unfortunately, you will not receive regular updates from Oracle about their changes. 

At Xynomix, however, we keep a track of these changes and keep you informed along the way.

For more information on preparing for an Oracle License Audit,
contact us via
[email protected] or on 0345 222 9600.

Contact Xynomix

Xynomix has unrivalled experience across the full range of Oracle and Microsoft SQL server database environments. As industry-leaders in managed database services and consultancy, we are perfectly positioned to offer independent enterprise-grade support to keep your critical systems up and performing perfectly. Get in touch now on 0345 222 9600 or via [email protected].