Definition

The Process of Conducting an Intellectual Property Audit

The first step in conducting an intellectual property audit is to develop an inventory of a firm’s existing intellectual property. The inventory should include the firm’s present registrations of patents, trademarks, and copyrights. Also included should be any agreements or licenses allowing the company to use someone else’s intellectual property rights or allowing someone else to use the focal company’s intellectual property.

The second step is to identify works in progress to ensure that they are being documented in a systematic, orderly manner. This is particularly important in research and development. As mentioned earlier, if two inventors independently develop essentially the same invention, the right to apply for the patent belongs to the person who invented the product first. Properly dated and witnessed invention logbooks and other documents help prove the date an invention was made.

The third step of the audit is to specify the firm’s key trade secrets and describe how they are being protected. Putting this information in writing helps minimize the chance that if a trade secret is lost, someone can claim that it wasn’t really a trade secret because the owner took no specific steps to protect it.

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