This specific audits are not on licensing, but on contract clauses. Microsoft is not aiming to earn more money due to audits on licensing, but wants to reduce business risks by – worst case – eliminating partners from the ecosystem when they are not acting according to contract clauses.
Service Providers
Recently we have assisted multiple SPLA (Service Provider License Agreement) partners audited on these contractual clauses, such as anti-corruption and US export regulations (yes, they do apply to partners outside the USA too).
Microsoft selects one of the ‘Big 4’ (KPMG, Ernst and Young, Deloitte, PWC) accounting firms to audit the partners. Partners have to hand over lists with customer names and VAT numbers which the auditing firm will verify against the conditions set forth in the Agreement.
Partners also have to proof that they have anti-corruption policies and mandatory training in place. And there is more. All in all, a big shift in how Microsoft is auditing partners. Please note that the ‘traditional’ audits are still being conducted and did not vanish.
Other partners
But not only Service Providers are on Microsoft’s radar. With the new October 1st 2022 changes in licensing and the introduction of the CSP Hoster partner, Microsoft is auditing all partners. One of the topics of interest is the Code of Conduct. We have run into a good article on CRN.com to read on the recent audit additions.
Audit Defense
If you are a Microsoft partner and you are selected for an Audit (regular or the new one), please do reach out to us. We have a decent Audit-Defense program in place with very experienced consultants who helped many Microsoft partners before. Audit defense guarantees that the audit is conducted as it should and minimizes your resources, time and legal risk. Please contact us for more information.