Oracle’s agreements (usually) include an audit clause that give Oracle the right to audit its customers. This is typical with most software vendors. Oracle’s license audits are carried out by its License Management Services (LMS) team.
The actual cause for an audit can be anything and there may not be much you could have done to avoid it. It could be any combination of the following:
  • Disgruntled sales rep.
  • A slow sales cycle.
  • Specific risk factors, like virtualization, mergers and acquisitions, high growth, use of Oracle Apps without matching Oracle Tech/Middleware footprint.
  • Your company is growing but you are not consistently buying more Oracle licenses.
  • Calls to Oracle Support that could have tipped them off about what you are using Oracle software for.
  • You or your company’s personnel may have disclosed to the Oracle sales 
  • Recently expired ULA.
  • Random “shot-in-the-dark” audit, or a means of “convincing” the customer into signing some other deal.
  • Countless other reasons…
Whatever explanation you may be given by Oracle – and you will likely get a vague answer as to why you have been chosen to be audited – the bottom line is simple: to get more money out of Oracle’s existing customer base. It may be couched as “protecting intellectual property”, or “Oracle exercising its right to audit”, or something similar but the goal is the same – to squeeze every penny out of its customers.
Oracle may aim to accomplish this in several ways. It could use the audits and use “gotcha” outcomes with its customers as a means to force customers into either buying more licenses, or buying new fangled Oracle hardware that customers don’t need, or Oracle Cloud services that are simply not up to the mark and not desired by the customers. Customers may simply see these as cheaper options than buying full licenses and basically accept these as a means to resolving the audit while minimizing cost.
We at Redwood Compliance understand that by signing an agreement that includes an audit clause, customers are ceding some ground to Oracle and accepting the possibility of an audit from Oracle. However, being audited does not mean that customers must be powerless and accede to any and all requests and conclusions made by Oracle’s auditors. A well informed and prepared customer, with expert support if needed, will maintain control of the process and ensure it will not be taken advantage of.