It’s around this time of year that the compliance group at Microsoft finalize their yearly list of audit candidates. There are several different audit motions at Microsoft but for the purpose of this article we are talking about LCC (License Contracts & Compliance) audits, which are the audits conducted by one of the big audit firms, such as KPMG or Deloitte.
The methodology for selecting candidates varies year-to-year, but often includes a mix of those with high SPLA run rates, SPLA partners who showed significant findings in their audit 3 years ago and then a bunch of random selections. The criteria for the random selections can range from irregular reporting (missing months, high monthly variance, etc.) to just the need to meet a target number of audits for the coming year.
The Microsoft SPLA audit is book marked by two significant documents: The audit notification and the audit settlement letter.
The audit notification typically arrives via Fedex and is a formal document that invokes the audit clause in your SPLA and Master Service Agreement (MSA). If you have concerns that you might be under reporting, don’t wait until you get this notification.
An investment in a Risk Assessment or private audit with Altaris can pay off in spades. As an example, just one missed server with say, 24 cores, running SQL Enterprise, can cost you over $200,000 if they only go back 3 years! In some case they go back up to 5 years.
The other significant document you would receive is the audit settlement letter. This is only sent once a draft ELP (Effective Licensing Position) is agreed on by both parties. We recommend you heavily scrutinize the draft ELP and understand how they have arrived at their totals.
At some point your organization with need to sign off on the settlement letter. Two significant things to note:
The date range covered in the audit: There is typically a 3 year date range listed on the settlement letter. Once signed, your organization can no longer be audited again for that period of time.
The SKU’s and quantities you must report to your reseller through a one-time order, by a given date.
Microsoft used to list the dollar amount owing on the settlement letters but then started listing just the SKUs and quantities. The reason they changed that practice was based on feedback from the SPLA reseller channel. Apparently not all resellers charge the same amount and some mark up SPLA pricing.
If you do find yourself looking at a settlement letter, and potentially a large order you need to make with your reseller, it’s not a bad time to make sure you are getting the best price. The difference could be material.
If you have any audit-related questions, don’t hesitate to reach out. We are more than happy to get on the phone and provide complimentary consultation on all things related to Microsoft Licensing. Just email info@altariscloud.com or click the button below to schedule an appointment through our online calendar.
From your Microsoft Licensing Experts at Altaris Cloud