The Importance of “Audit Effective Date” in SIIA Audits

One of the first things I ask a prospective client is: What is the date on the initial letter you received from the SIIA? The date on the initial in a SIIA letter is often referred to as the Audit Effective Date. This date is important for many reasons. I like to tell my clients that a SIIA audit measures a snap-shot in time – what SIIA member software was installed on the company’s computers as of the Audit Effective Date. Once you have an accurate inventory of what was installed on the Audit Effective Date the next step is to determine what proofs of purchase are available to establish purchases prior to the Audit Effective Date.

When a SIIA audit matter is settled, the target is required to certify that the audit results provided during the course of negotiations are true and correct as of the Audit Effective Date. For this reason uninstalling software that was installed on the effective date, or purchasing software products after the effective date have no impact on the SIIA’s calculation of fines in SIIA audits. It is critical to obtain an accurate inventory of the software installed on the target company’s computers as quickly as possible following receipt of the initial letter from the SIIA. Failure to understand the importance of the Audit Effective Date, has caused companies to go on software buying sprees in response to a SIIA audit and to report results to the SIIA reflecting the software installed on a date after the Audit Effective Date. I believe that both of these strategies are mistakes that should be avoided.

Scott & Scott, LLP is not affiliated in any way with the SIIA.