Intellectual Property Audit

Creations of the mind that are legally protected, including patents, trademarks, copyrights, and trade secrets. IP is a critical intangible asset category for technology and innovation-driven firms and can be licensed, sold, or used as collateral for financing.

A chronological record of system activities, transactions, or document changes that provides a verifiable history of who did what, when, and why. Audit trails are essential for regulatory compliance, fraud detection, and internal controls, and are required by standards including SOX, GDPR, and ISO 27001.

Contracts that grant permission to use intellectual property (patents, trademarks, software, content) in exchange for fees or royalties. Licensing is both a monetisation strategy for IP owners and an intangible asset for licensees who gain access to proprietary technology or brand rights.

A legal assessment that determines whether a product, process, or technology can be commercialised without infringing the intellectual property rights of third parties. FTO analysis involves searching and reviewing granted patents and pending applications in relevant jurisdictions to identify potential infringement risks.

An income-based valuation technique that estimates the value of an intangible asset by calculating the present value of hypothetical royalty payments the owner is relieved from paying by owning the asset. The method is commonly applied to value trademarks, patents, technology, and trade names in both transaction and financial reporting contexts.

A legally binding contract that establishes confidentiality obligations between parties sharing proprietary information. NDAs are essential tools for protecting trade secrets and other sensitive intangible assets during due diligence, partnership discussions, and employee onboarding.

Statements of fact and assurances made by the seller (and sometimes the buyer) in an M&A sale and purchase agreement regarding the condition, operations, finances, and legal standing of the target business. Warranties cover areas including financial statements, material contracts, intellectual property ownership, litigation, tax compliance, and employee matters.

A legal framework that governs the use, modification, and distribution of open source software, defining the rights and obligations of users and contributors. Key licence types include permissive licences (MIT, Apache 2.0, BSD) that allow broad commercial use with minimal restrictions, and copyleft licences (GPL, AGPL) that require derivative works, with their source code, to be released under the same terms when they are distributed (or, under the AGPL, offered to users over a network).

IP Audit: What It Covers, a Checklist and UKIPO Funding

The nine areas an IP audit covers, an IP audit checklist, when to commission one, and the UKIPO-funded IP Audit scheme.

AI Valuation Methods for M&A and Due Diligence

How is IP valued for secured lending?

IP is valued to a credit standard under IVS 210, using income, market or cost approaches, then adjusted to an orderly-disposal figure. That collateral value, tested for saleability, sets the loan-to-value.

What royalty rate is used to value IP for lending?

There is no single fixed rate. Valuers derive it from comparable market licences for similar IP, and for lending they deliberately use a low-end, conservative rate to avoid overstating collateral value.

What is an information memorandum?

An information memorandum is the detailed document a seller's adviser prepares to market a business to buyers under NDA — financials, customers, team, growth and the assets behind the price.