How to Go Ahead with IP Audit?
A business owns, acquires, or uses IPs in various fields which require systematic review. The review of IPs in a company is generally what is known as an IP audit. This audit helps in structuring and assessing any risk involved in taking IP forward. The audit clarifies any such risk which the company can take a note of and structure the remedy that can be required. The audit firm will review all the policy and compliance procedures which will further help the business to structure their IP and analyze them. A few of the pertinent questions that might get answers are: what IP is owned by the company and what is acquired? How much of them are in use? Is there any IP that is infringing others’ IP? How much of them are in use? All such answers will make the company more efficient, in terms of its decision-making process. IP strategies are the most important aspect for the company. This IP strategy can be more structured and focused through an efficient IP audit, making the business owner in a much better position to decide the future of the company.
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Conducting an IP audit
With no such rule for who to consider IP audit, it can be done by any such professional who has the expertise in the field of IP. Moreover, the professional who is conducting the same must have some of the technical expertise in the field in which the company deals. There has to be a basic understanding of the technical expertise that the company is into. Without that, having an IP audit is close to difficult. It is the prerogative of the company to have an external or internal audit team. An important point to mention here is that before starting an IP audit, all external members in the audit team, as well as all the internal staff members on the audit team, should sign non-disclosure agreements.
Preparing an IP Audit Report
The reason for the IP Audit needs to be clearly understood by the team that is conducting it. The clarity for the purpose needs to be there that what exactly prompted the conduct of the audit. Because when the nature of the IP audit is noted then it becomes easy to get along with the process. This will also enhance the extent of the time and availability of finances required for the audit. Now after getting into the reason for the audit, it will help the audit team to understand the company for a special reason. A few important points must be noted which form the part of background research. Background research will be the basis of the audit and will provide the auditor(s) with the required background information for preparing a plan for conducting a comprehensive audit, focused, timely, and cost‐effective. There is a lot of information which is required like the relationship that the company has with their counterparts, the regular interaction with the stakeholders as such as its employees, vendors, customers, consultants, independent contractors, joint venture partners, competitors, etc., and what role(s) IP assets play or would play in these interactions.
An IP auditor normally starts works from a detailed checklist, which is modified for the type and size of the company’s business, relevant IP laws of the relevant countries, desired purpose(s), and the desired outcome(s) of the audit. (2) A good checklist minimizes the chances of leaving out one or more relevant steps from the process. Each member of the audit team should be provided the relevant part of the detailed checklist. (3) To produce a comprehensive, company‐wide IP audit report reflecting the entire development and decision‐making process for each of the company’s products and processes, the audit team should collect, review, and organize not only the IP information but also all the agreements that may affect the IP portfolio of the company. It may also have to do or get done relevant IP searches in all key markets.
Author: Saransh Chaturvedi an associate at IP And Legal Filings, in case of any queries please contact/write back us at support@ipandlegalfilings.com.
