Oracle Audit Defense – Strategies for IT executives in 2023

In the article titled “Oracle Audit Defense – Strategies for IT executives in 2023” on Redress Compliance, you will learn about:

1. Oracle Audit Defense: The article provides a comprehensive understanding of what Oracle audit defense is, its importance, and how it assists organizations in navigating through Oracle software license audits.
2. Oracle Audit Process: The process of an Oracle audit is explained in detail, from the initial notification to the final audit report. It also highlights the everyday products that are usually audited.
3. Common Mistakes and Advisory Role: The article discusses common mistakes organizations make during Oracle audits and emphasizes the importance of having an advisor before the audit begins and at the end of the audit. It also provides recommendations on how to respond to an Oracle audit notification.

This article is a must-read for IT executives looking to understand and prepare for Oracle audits in 2023.

What is Oracle Audit Defense?

Oracle audit defense is a service provided by third-party consultants or firms to help organizations prepare for, navigate, and respond to an Oracle software license audit. Like many other software vendors, Oracle conducts periodic audits to ensure customers comply with their software licensing agreements.

An Oracle audit defense service aims to:

1. Assist organizations in understanding their licensing status and identify potential risks or non-compliant scenarios.
2. Help organizations prepare for an Oracle audit by gathering the necessary documentation, reviewing software usage, and analyzing licensing agreements.
3. Provide guidance and support during the audit process, including communication with Oracle auditors, negotiation of findings, and dispute resolution.
4. Develop strategies to minimize financial exposure and ensure future compliance with Oracle licensing policies.

By engaging an Oracle audit defense service, organizations can reduce the risk of non-compliance, avoid potential fines and penalties, and negotiate more favorable terms with Oracle in case of discrepancies.

What is an Oracle Audit?

Oracle software audits occur when Oracle chooses a customer to undergo a license compliance assessment. Software audits represent a significant revenue stream for many software companies, and Oracle is no exception.

These audits evaluate the deployment and utilization of Oracle software within a customer’s data center or cloud environment. If the customer is discovered to have insufficient licenses, Oracle will request that they acquire the necessary licenses to achieve compliance.

Oracle Software Audit Process

The Oracle audit process typically unfolds as follows: Oracle sends a written notification expressing their intent to audit a customer, with a letter addressed to the company’s CFO.

Customers have 45 days to acknowledge the audit letter, with the response time specified in the Oracle Master Agreement, which every customer signs when purchasing Oracle software licenses.

Oracle then requests that customers execute their Oracle license compliance scripts on all Oracle software servers. The Oracle LMS scripts produce a raw output of up to 13 different files, which cannot be analyzed without proper training.

The customer must share this output with Oracle, who will conduct an audit and determine the customer’s licensing position. More information about the Oracle audit process can be found on the Oracle audit organization’s website, Oracle LMS.

Which products do they audit?

Oracle software audits almost always include their database – DBMS, options, and Oracle application servers. If you have Oracle ERP – Oracle EBS. Oracle will want to audit your Oracle ERP, also.

What do you need to know about an Oracle license audit?

• Most software compliance problems are because someone in your IT department misunderstood or didn’t know the Oracle licensing rules and policies.
• This means that if you can find someone to review your Oracle licensing estate before the audit, there is a good chance you will pay no penalty fees in the Oracle audit.
• Oracle audits can be difficult to control; we recommend you work with someone who has done hundreds of Oracle audits before, as you will always have a plan and know the next steps.

Oracle Software – common Oracle compliance issues

• Installing the wrong edition of Oracle software causes you to be out of compliance with your software entitlements.
• Having the wrong licensing metrics or model for a specific server, such as Oracle Named User Plus licensing, when you should have a processor license.
• Misunderstand how to license Oracle on VMware or other virtualization technologies.
• Misunderstanding how to calculate Oracle licensing on AWS or Oracle licensing on Azure.

Why you need an advisor before the Oracle audit begins

• You can negotiate which products Oracle will audit; there may be a reason for excluding a product with more uncertainty over your compliance position.
• You can also exclude geographical areas, for example, legal entities in other countries.
• You should also negotiate which tools will be used. Will you use Oracle LMS scripts or use manual declaration/sharing of data?
• Also, negotiate the Oracle audit timeline to ensure that the Oracle audit has an end date that both parties agree to.

Why you need an Oracle audit negotiation advisor at the end of the audit

• The Oracle audit report can be difficult to understand if you haven’t seen an Oracle license audit report previously; an audit advisor can truthfully explain the findings.
• Oracle will never include pricing or discounts in an Oracle license audit report, and here is where the audit negotiation advisor comes in. Suppose he/she is experienced and involved in many Oracle audits. In that case, they can tell you how much other companies paid for similar findings to ensure you don’t overpay Oracle.

Three reasons why you should get help from an advisor

• Using an external audit negotiation advisor can help you think emotionally over any shortfalls, as there might be internal blame for the non-compliance.
• An experienced Oracle audit negotiation advisor will be able to provide you with a feeling that you are in control over the audit and that there are no surprises.
• An audit advisor will also ensure that you do not make any mistakes in negotiating the audit before it begins or at the end. Oracle licensing mistakes are very costly.

Recommendations to respond to an Oracle notification for audit

• Once you receive the Oracle audit letter, contact an independent Oracle licensing expert firm to help your company review your Oracle licensing position.
• The company can take Oracle’s official audit scripts and tell you the results before the official Oracle audit begins.
• You will then need to decide how to remediate the compliance issues, such as making changes to your infrastructure and purchasing licenses.
• The firm can then provide you with an Oracle audit defense strategy, which includes what type of data to share with Oracle, communication strategy, and negotiation advisory.

How Redress Compliance Can Help

Oracle License Audit Defense Service

• Pre-Audit Analysis
  • Evaluate your current Oracle licensing landscape
  • Identify potential non-compliance issues or vulnerabilities
  • Recommend proactive measures to minimize audit risks
• Audit Preparation Support
  • Assist in gathering and organizing the necessary documentation.
  • Ensure accurate and complete representation of your licensing status
  • Guide how to communicate with auditors effectively.
• Audit Management and Defense
  • Act as a liaison between your organization and Oracle auditors
  • Challenge and defend against audit findings
  • Utilize industry expertise to navigate complex licensing terms
• Remediation and Resolution
  • Develop strategies to address identified non-compliance issues
  • Negotiate with Oracle to minimize financial and operational impact.
  • Assist in the implementation of corrective actions and license optimization
• Post-Audit Support
  • Provide ongoing advice on maintaining Oracle license compliance
  • Monitor changes in Oracle licensing policies and regulations
  • Offer insights to help avoid future audits and optimize your license investments