How Redress Compliance reduced IBM audit liability by 95% for one of Brazil's largest retail chains — bringing a BRL 50 million claim down to BRL 2.5 million through expert audit review, data validation, strategic negotiation, and enhanced compliance governance.
One of Brazil's largest retail chains, with hundreds of stores nationwide and a rapidly growing e-commerce platform, faced an IBM audit with claims of BRL 50 million in alleged non-compliance fees. The company's IT infrastructure supported critical operations including inventory management, customer relationship systems, and supply chain logistics.
IBM's audit findings highlighted discrepancies in sub-capacity licensing, entitlement mismatches, and overages in virtualised environments. Given the significant financial exposure and the need to maintain seamless operations across its entire retail network, the retailer engaged Redress Compliance to resolve the audit and safeguard its financial position.
IBM audits in Latin America frequently produce inflated claims that do not reflect actual licensing positions. Sub-capacity licensing in virtualised environments is one of the most commonly misinterpreted areas — IBM's audit tools often overcount processor usage when ILMT is not fully deployed or properly configured. Entitlement mismatches between historical agreements and current deployments are another frequent source of inflated claims. For large retailers running complex, multi-site IBM environments, the gap between IBM's initial audit claim and the actual compliance position is typically 60–90%.
Conducted an in-depth assessment of IBM's audit report and developed a comprehensive defence strategy:
Gathered and validated accurate data to counter IBM's audit findings:
Executed a data-driven negotiation strategy to achieve maximum claim reduction:
Implemented long-term compliance measures to prevent future audit exposure:
| Metric | Detail |
|---|---|
| Initial IBM Audit Claim | BRL 50,000,000 |
| Final Settlement | BRL 2,500,000 (95% reduction) |
| Total Savings | BRL 47,500,000 |
| Penalties | Zero — no penalties or retroactive fees imposed |
| Business Continuity | Uninterrupted retail and e-commerce operations maintained throughout |
| Compliance Enhancements | Centralised licence management and real-time monitoring systems implemented |
| Future Scalability | Settlement covered additional licences required for planned growth |
| Governance | Automated compliance framework with internal audit processes established |
"Redress Compliance turned a challenging audit into an opportunity to strengthen our compliance framework. Their expertise saved us millions and ensured our operations remained seamless. Their support was invaluable to our success."CIO — Leading Brazilian Retailer
IBM audit claims are opening positions, not final verdicts. For large retailers operating complex, multi-site IBM environments with virtualised infrastructure, IBM's initial audit figures routinely overstate actual liability by 60–95%. The combination of expert audit report analysis, sub-capacity metric validation, entitlement reconciliation, and evidence-based negotiation consistently delivers dramatic reductions. Accepting IBM's initial audit claim without independent expert review is the single most expensive mistake an IBM customer can make.
As a fully independent advisory firm, Redress Compliance provides expert IBM audit defence, licence optimisation, and compliance advisory — with no commercial relationship with IBM.
Redress Compliance has defended enterprises worldwide against IBM audit claims totalling hundreds of millions in alleged non-compliance. Our team includes former IBM licensing specialists who understand IBM's audit methodology, pricing structures, and negotiation tactics from the inside. Early engagement typically produces the best outcomes.