SAP License Compliance – Best Practices for Audit and Check

SAP License Compliance involves:

  • Adherence to Contract Terms: Following the terms and conditions outlined in the SAP software license agreement.
  • Proper License Utilization: Ensuring that the use of SAP software aligns with the purchased licenses in type and scope.
  • Regular Audits and Monitoring: Conducting regular internal audits and monitoring usage to maintain compliance with licensing agreements.
  • Alignment with Policy Changes: Keeping up-to-date with SAP’s policy changes and adjusting license management accordingly.

SAP License Compliance Introduction

SAP (Systems, Applications, and Products in Data Processing) is a leading software company that provides enterprise resource planning (ERP) software to businesses of all sizes.

However, companies must purchase licenses for each user to use SAP software.

This is where SAP license compliance comes into play. Maintaining SAP license compliance is essential for companies to avoid penalties and fines for using SAP software without proper licenses.

What is SAP License Compliance?

SAP license compliance refers to ensuring that a company uses SAP software within the bounds of its license agreement.

This means the company must have the correct licenses for the number of users accessing the software.

Companies must also follow the terms and conditions of their license agreement, such as using only authorized modules and not using the software for unauthorized purposes.

Why is SAP License Compliance Important?

SAP License Compliance

SAP license compliance is essential for several reasons:

  • To avoid penalties and fines: Companies found to be non-compliant with SAP licensing can face penalties and fines, which can be costly.
  • To ensure fair competition: By ensuring that all companies use SAP software within the bounds of their license agreement, SAP license compliance helps to level the playing field for all businesses.
  • To protect intellectual property: SAP invests significant time and resources into developing its software. The company can protect its intellectual property by enforcing SAP license compliance and using its software appropriately.

What is an SAP License Audit?

An SAP license audit reviews a company’s SAP license usage to ensure it complies with its license agreement.

During an SAP license audit, SAP may review a company’s SAP software usage, the number of licenses in use, and the terms and conditions of the license agreement.

What is an SAP License Compliance Check?

An SAP license compliance check is a self-review that a company can conduct to ensure that it complies with its SAP license agreement.

This can include reviewing the number of licenses in use, the terms and conditions of the license agreement, and the software usage logs.

How to Conduct an SAP License Compliance Check

SAP License Compliance check

Conducting an SAP license compliance check can help ensure that a company complies with its SAP license agreement and avoid penalties and fines.

Here’s how to conduct an SAP license compliance check:

  • Review the number of licenses in use: Compare the number of licenses in use to the number of licenses purchased by the company.
  • Review the terms and conditions of the license agreement: Ensure that the company follows all of the terms and conditions, such as using only authorized modules and not using the software for unauthorized purposes.
  • Check software usage logs: Review the logs to determine how many users access the software and what modules they use.
  • Conduct a gap analysis: Compare the current SAP license usage to the company’s business requirements to identify gaps. This can help the company determine if it needs to purchase additional licenses.
  • Review past audits: If the company has undergone an SAP license audit, review the findings to ensure any issues have been addressed.

How to conduct an SAP internal license audit

1. Understand Your Licensing Agreement

  • Review Contractual Terms: Carefully examine your SAP license agreement to understand the types and quantities of licenses purchased and any specific terms or restrictions.
  • Clarify License Types: Differentiate between various license types (e.g., Professional, Limited Professional, Developer) and their usage criteria.

2. Inventory Current SAP Usage

  • User Analysis: List and categorize all current SAP users based on their roles and access requirements.
  • Software Utilization: Assess which SAP modules and functionalities are in use and by whom.

3. Leverage SAP Measurement Tools

  • Use SAP LAW (License Administration Workbench): This tool helps consolidate system measurement data from different SAP systems.
  • Apply SAP Transaction Codes (T-Codes): Utilize specific T-Codes for license audits, such as USMM and SLAW.

4. Monitor Indirect/Digital Access

  • Identify Non-SAP Systems: Recognize systems that interact with SAP software, potentially requiring indirect access licenses.
  • Evaluate Integration Points: Assess the data flow between SAP and non-SAP systems for licensing implications.

5. Compare Actual Usage with License Entitlements

  • Align Usage with Licenses: Map actual user roles and software usage against the purchased licenses.
  • Identify Discrepancies: Look for over-usage, under-usage, or misalignment of license types.

6. Document Findings and Plan Adjustments

  • Create Compliance Reports: Document your findings and compare them with contractual obligations.
  • Plan for Adjustments: Develop a strategy for addressing any discrepancies, such as reassigning licenses or purchasing additional ones.

7. Implement Continuous Monitoring

  • Regular Audits: Schedule periodic internal audits to ensure ongoing compliance.
  • Adjust for Organizational Changes: Update the SAP license inventory for changes like new hires, departures, or role changes.

8. Consult with Experts if Needed

  • Seek Professional Advice: Consider consulting with SAP licensing experts for complex environments or to validate findings.

9. Maintain Comprehensive Records

  • Record-Keeping: Keep detailed records of all audits, user lists, and correspondences related to SAP licensing for reference in official SAP audits.

Organizations can proactively manage their SAP licenses, ensure compliance, and optimize their SAP investment by conducting an independent SAP license check.

This proactive approach can prevent unexpected costs and legal issues related to non-compliance.

FAQs on SAP License Compliance

Q: What happens if a company is found to be non-compliant during an SAP license audit?

A: If a company is found to be non-compliant during an SAP license audit, it may face penalties and fines. The company may also be required to purchase additional licenses to bring it into compliance.

Q: How often do SAP license audits occur?

A: SAP license audits can occur at any time, although typically conducted regularly, such as once a year.

Q: Is it possible to negotiate the terms of an SAP license agreement?

A: Yes, it is possible to negotiate the terms of an SAP license agreement. However, it is important to work with an SAP licensing expert to ensure that the terms are fair and compliant with SAP licensing guidelines.

Q: How can a company ensure it complies with SAP licensing?

A: To ensure that a company remains in compliance with SAP licensing, it is essential to conduct regular SAP license compliance checks and to stay informed about any changes to SAP licensing policies.

The company should also work with an SAP licensing expert to ensure its license agreement is up-to-date and compliant with SAP licensing guidelines.


SAP license compliance is an essential aspect of using SAP software, as it helps ensure that companies use the software within the bounds of their license agreement.

By understanding SAP license compliance, including SAP license audits and compliance checks, companies can avoid penalties and fines and ensure they use SAP software appropriately.

Regular SAP license compliance checks and staying informed about changes to SAP licensing policies can help companies maintain compliance with SAP licensing.

SAP License Compliance Service by Redress Compliance

Overview Redress Compliance offers a comprehensive SAP License Compliance Service designed to help organizations navigate the complexities of SAP licensing.

Our service ensures your company complies with SAP’s licensing terms and conditions while optimizing your SAP software investment.

Key Features

  1. Detailed License Analysis: We conduct an in-depth analysis of your existing SAP licenses against actual usage to identify any discrepancies or areas of non-compliance.
  2. Contract Review: Our experts meticulously review your SAP license agreements to ensure a clear understanding of terms, conditions, and obligations.
  3. Usage and User Role Audit: We thoroughly audit user roles and software utilization, ensuring alignment with the licensed entitlements.
  4. Indirect Access Evaluation: Our service includes assessing potential indirect or digital access scenarios that could impact licensing requirements.
  5. Compliance Reporting: We provide detailed reports highlighting compliance status, risk areas, and optimization recommendations.
  6. Strategic Advice for Optimization: Beyond compliance, we offer strategic insights on optimizing your SAP license portfolio for cost savings and efficiency.
  7. Continuous Monitoring and Support: We offer ongoing monitoring and support services to ensure sustained compliance and address future licensing changes or organizational growth.
  8. Expert Consultation: Access to our team of SAP licensing experts for any queries or specific challenges related to SAP licensing.


  • Ensure Compliance: Avoid legal and financial risks associated with non-compliance.
  • Cost Optimization: Identify opportunities for cost savings through optimal license utilization.
  • Peace of Mind: Confidently navigate SAP licensing complexities with expert guidance.
  • Strategic Planning: Align SAP licensing with your organization’s growth and plans.

Contact Redress Compliance

To learn more about our SAP License Compliance Service or to schedule a consultation, please get in touch with Redress Compliance:


  • Fredrik Filipsson

    Fredrik Filipsson brings two decades of Oracle license management experience, including a nine-year tenure at Oracle and 11 years in Oracle license consulting. His expertise extends across leading IT corporations like IBM, enriching his profile with a broad spectrum of software and cloud projects. Filipsson's proficiency encompasses IBM, SAP, Microsoft, and Salesforce platforms, alongside significant involvement in Microsoft Copilot and AI initiatives, enhancing organizational efficiency.

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