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ARTICLE · 15 FEBRUARY 2017

Settlement Structuring For IBM Audits

Scott & Scott LLP
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Software-compliance audits initiated by IBM can be extremely burdensome and time-consuming and can force companies to face challenges that are somewhat unique among major-publisher audits.

United StatesAccounting and Audit
Christopher Barnett
Christopher Barnett
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Software-compliance audits initiated by IBM can be extremely burdensome and time-consuming and can force companies to face challenges that are somewhat unique among major-publisher audits. For one example, a significant component of IBM's business model is the acquisition of other software vendors and the integration of those vendors into IBM's product portfolio, which can complicate the task of identifying the appropriate license metrics and entitlements owned. For another example, companies seeking to license IBM products based on processor resources in virtualized environments must use IBM's License Metric Tool (ILMT) in order to avoid licensing the products based on the full capacity of the host infrastructure. The ILMT question can become a significant satellite issue to explore during an audit, and failure to demonstrate compliance can yield substantial licensing exposure.

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