How to Do a Software Audit, What You’ll Learn, and What to Do Next

Software audits are essential to most businesses, and they provide two main benefits. First, they enable a business or organization to know if they are compliant (or not) with software licenses. And second, they let businesses understand how often software is being used.


  • What a software audit is and why it is performed

  • Different types of software audits

  • How to perform a software audit

  • What can be done after a software audit

What Is a Software Audit and Why Is it Performed?

A software audit tracks and reports software use within an organization. It can report how frequently software is used, who is using it, and whether it has an up-to-date license. An added importance of a software audit is to help prevent and mitigate external audits.

External audits can be requested from a software publisher to ensure licenses are up to date. They can also be initiated internally to optimize licenses and to protect against external audit requests.

The results of internal software audits allow organizations to manage their software licenses better. It helps your organization to avoid using illegally installed software with outdated licenses. It also identifies which unused licensed software could be uninstalled.

If your company pays for software, you need to know if you are overpaying for unused licenses or setting yourself up for a potential financial and legal risk by using unlicensed software. In general, all types of businesses should perform software audits, but this preventative measure is vital for larger entities like hospitals, educational bodies, and government agencies.

What Are the Different Types of Software Audits?

Here are five of the most common types of software audits:

Copyright/License Audit: The audit checks to make sure an organization is following copyright laws and observing software license agreements.

Usage Audit: The audit checks for how often software is used and which users are using it.

Version Audit: The audit checks for which version or patch is used.

Internal Audit: The audit is initiated and conducted within the company.

External Audit: The audit is initiated by a software provider. These are typically copyright/license audits to make sure their product has been purchased and is being used in support of their license agreement.

How to Perform a Software Audit

There are five steps to the software audit process.

1. Determine the Purpose and Scope

Trying to do everything at once will lead to confusion and a mass of information that will be difficult to search through or understand. When you start a software audit, you need to know what you are checking for and why.

The scope of the audit should only search, identify, and report on pertinent information. While you can broaden the audit to include additional programs or functions, it is better to get one set of information at a time rather than be overwhelmed with information that you have to sift through and organize.

As part of your software audit checklist, set clear guidelines for when and how fast the audit will take place. While some auditors like to push for a fast resolution of the audit, it is not always the best choice. A fast audit can provide a snapshot of the organization, but it is often very difficult or impossible to have complete participation and coverage.

2. Choose a Tool or Process

The next step in your software audit process is to establish which software tool you will use to fit your purpose and scope. This might take additional research into the different data collection tools you can potentially use.

While it can be tempting to use a tool that tracks and provides broad ranges of information, it is always better to limit your results than to sift through a pile of data for the pieces you need.