CONTACT

ROYALTY & LICENSING

A Contract Compliance Review and Royalty Inspection in the area of brand licensing is an analysis and investigation of a licensee's compliance with respect to all of the terms, financial and otherwise, set forth in the license agreement and a verification of the accuracy and timeliness of reports and payments.

We take the time to understand your business, your contracts and your compliance concerns with respect to the selected client. We keep you advised at every stage of the engagement. We know that timely and effective communication is vital.

The objectives of the Review and Inspection are to confirm, among other things, that

• Only authorized products are being sold
• Sales are within the licensed territories and distribution channels
• Product and marketing approval processes have been implemented
• Packing requirements are being satisfied
• Advertising expenditure commitments have been fulfilled
• Third-party manufacturer agreements have been executed

And to verify the accuracy and timeliness of:

• Royalty calculations
• Reports and payments
• On-hand inventories

There may be additional advantages to performing a Review that can be just as important to a licensor
that manages multiple license agreements including:

• Signaling value to licensees: Performing audits is a powerful incentive for all licensees to comply


• Identifying unauthorized or damaging use of property: Use of the licensed property in unauthorized territories, or on unapproved products, or by unauthorized sub-licensees or third-party manufacturers, could impose significant risk or costs to the licensor


• Grounds for license amendment: Examples of a licensee's noncompliance will improve the licensor's ability to negotiate favorable amendments to the original agreement, negotiate new agreements, or increase royalty rates, minimum fees or guarantees.

Our final reports describe the procedures performed in connection with our engagement and provide
documented non-compliance findings, observations and recommendations, including proposed
improvements to processes and procedures, and enhanced internal controls; as well as a detailed
explanation of the monetary findings with respect to the reporting and payment of royalties.