Licensing is a cooperative relationship. Everything we do is built to keep it that way — for licensors and licensees alike.
We've watched respect erode across the licensing industry, and we've chosen to work differently. RMA is committed to treating both licensors and licensees with respect, because licensing is inherently cooperative. Our whole purpose is to create superior licensors by making better licensees.
Audits only become contentious when they're delayed or run reactively, in the middle of a crisis. Every licensee needs periodic auditing, and a properly run audit program more than pays for itself — which removes any financial argument against auditing in the first place. Licensees already report monthly or quarterly; a consistent, predictable audit schedule is simply the other half of that rhythm.
Most successful licensors eventually adopt a rotational program that reaches every licensee. Without an auditor's review and input, a licensor simply doesn't have accurate visibility into its own business — because licensees prepare their royalty reports with no outside oversight, leaving questions that only an audit can answer.
The primary goal of an audit isn't to catch a licensee out — it's to leave them with a deeper understanding of what accurate reporting requires going forward. We don't stop at identifying past errors. We aim to improve future reporting and hand licensees easier, cleaner ways of working.
An audit should never cost more than it's likely to return. A full, traditional audit can run $10,000–$25,000, and at that price it rarely justifies itself — but skipping audits altogether is just as poor a strategy.
A good audit is exposure-directional: cost-conscious, yet still profitable. A focused two-to-four-day review shouldn't be abandoned simply because a comprehensive audit isn't economically feasible. We start targeted, then expand scope only if initial testing turns up significant errors.
Technology has changed what's possible. Licensees can now transmit far more data electronically than before, which lets us audit smaller licensees too — where under-reporting is, percentage-wise, most common. Off-site work moves at a sensible pace, allows for data corrections along the way, and leaves the licensee's reporting systems better than we found them.
Only the very largest licensors can justify in-house auditors — and even they benefit from outsourcing. It maintains continuity, controls cost, and provides a level of expertise that internal teams rarely develop or retain over time.
In our experience, licensees aren't upset by audits — they expect them. They generally believe they're reporting accurately (though errors are almost always found), and they want assurance that their competitors are being held to the same standard. Audits are very seldom contentious when the auditor understands the licensor/licensee relationship and stays professional throughout.
Licensees genuinely appreciate practical tips for preparing simpler, more accurate reports. Most don't object to paying royalties in the first place — what they want is to avoid a surprise bill after the fact. More accurate, more efficient reporting serves everyone.
Let's talk about where a focused, exposure-directional review makes sense for your licensees.
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