A software audit is an independent comparison between a list of software installed in the company's computers and the software licenses owned by the company. The purpose of an audit is to find out whether all computers within a company use only software with valid licenses, in other words, that the company only uses legal software.

A license purchase means software purchase. The term software purchase is well-known and understandable but not very accurate, since clients do not purchase the software as such, but only a license which entitles them to use the software. In most cases, invoices or license agreements are used to document a software license purchase. These documents must contain clear identification of both the purchaser and the vendor, the software name and the license extent and type. Most vendors also issue general license terms and conditions which specify license types and the extent of the purchaser's privileges. It is therefore recommended using these license terms and conditions along with an invoice, including the product name and the license type, to document the software license purchase.

The list of valid licenses used within an organization will usually change over time. On the one hand, new licenses are purchased, and on the other, old licenses expire. New applications are installed on computers and old applications uninstalled from them. Therefore, software audits are usually performed to a certain date and must be repeated periodically if they are to meet their purpose as a control tool. Software audits are usually performed once or twice in a year.

The auditing process usually looks as follows:

The following chapters describe these steps in greater detail.