Author Rachel Nicholls
You may be wondering “what is an intellectual property audit?” as you’ve noticed a specialist IP law firm or Trade Mark Attorney promoting this service. Intellectual Property (IP) is an important and valuable asset for any business, and it’s vital that you are aware of what IP your business owns, know whether appropriate protection has been put in place, understand the value of that IP etc. Many businesses, large and small, take the time to assess or “audit” their Intellectual Property to ensure they can make the most of their IP portfolio and realise its true value.
So, what is an IP Audit ?
An Intellectual Property audit is a tool for assessing the IP assets of a business, namely the trade marks , patents, design rights and copyright . A comprehensive IP audit will include:
- Identifying the IP assets held by a business;
- An assessment of the protection currently in place to protect IP;
- An assessment of the current IP against the needs of the business;
- The systems in place within a business to protect future assets;
The audit will identify risks to the business and provide recommendations on how such risks can be eliminated or mitigated. The audit will also recognize and protect opportunities and direct budget to where it can be used most effectively. An effective audit is based on good communication. The relevant parts of the business must all be on the same page and understand the direction of travel and this needs to be effectively communicated and understood by your IP advisors. Communicating effectively in this way ensures that the various working parts of a business are aligned and problems further down the line are avoided.
Which businesses would benefit from an IP Audit ?
In short, all businesses would benefit from an IP audit and the size of the business dictates the size of the undertaking. The sooner you conduct an audit and put the business on the right track with its IP assets the more effective the business can be going forward, however, an audit can be particularly effective at certain stages, such as:
- First year of trading to make sure you are secure in what you’re doing, and that the necessary protection is put in place to continue to do so.
- New product or service launches to ensure you implement the correct protection strategy.
- When seeking investment or contemplating a merger or acquisition . A strong IP portfolio can make a business more attractive to investors.
- When assessing and developing the overriding business strategy, an effective IP strategy can help deliver your commercial goals.
What are the benefits of an IP Audit?
We’ve already touched on several benefits, but an IP audit can further add value to your business and its future growth by:
- Protecting the business
One, often overlooked, benefit of IP is to ensure the business can continue to trade and thrive with minimal risk from third party infringement. Conducting an audit will ensure that risks are identified so they are mitigated, and you are in the best position for the business to move forward.
- Identifying costs savings
All businesses have a limited budget for IP so its important to make your budget work for you. An IP audit can ensure that your decisions are well informed and produce maximum value for the business.
- Identifying opportunities
When managed effectively, IP can create new revenue streams. For example, An IP audit could help you to identify opportunities to licence your IP to third parties in new or existing territories.
- Identifying value
IP in any business has a monetary value and it changes over time. An IP audit can aid the assessment of the monetary value of your IP, which can add to the balance sheet of the business and can be used to attract investment or as collateral to raise funds. Our Trade Mark Attorneys recommend regular IP audits to better understand your real IP value.
- Assessing new markets
Before entering a new market, whether that be with a new product or a new territory you need to be aware of the risks and the cost of entering that market. An IP audit can assist with such assessments so that you can make wise decisions for your brand.
An effective IP audit will highlight any risks to your business or it’s brands and show you clearly how to use your IP effectively as a tool for business growth. If you don’t manage your IP correctly then you risk exposing your business to:
- infringement of third party rights
- missed opportunities for growth or expansion
- valuable budget wasting.
How do I carry out an IP audit?
It is highly recommended that you engage an IP specialist to conduct and advise on an IP audit. IP Professionals have an in-depth knowledge of the various types of IP and the mechanisms for securing protection. It’s important to engage advisors that will take the time to understand your business, how you operate and your business plan moving forward.
Whilst an audit will include an assessment of the IP a business currently owns, it will also include a detailed action plan of what is required to get the business to where it needs to be.
Once an audit has been conducted it is important that it is reviewed on a regular basis, ideally on an annual basis. Once the main audit has been conducted an annual review will ensure that the IP strategy will adapt to the changing needs of the business and make sure that you continue to benefit from the time and effort invested in the initial audit.
We create real IP value
From the everyday to the IP emergency, our accomplished Chartered Trade Mark Attorneys and IP Solicitors are driven to get the very best outcome for every brief for every client, every time! Sonder & Clay are a full service IP law firm with proven expertise and results in IP protection, strategy, disputes, and exploitation. Learn more about our IP services or get in touch with us for a complimentary IP audit today.