In the creative industries, your IP is often your pension, your safety net, and your future income.

Music. Publishing. Film. Software. Design. Licensing deals look great on paper — but one uncomfortable truth comes up again and again:

Royalties are frequently underpaid.
Not always deliberately. But often quietly.

That’s where a royalty audit becomes one of the most overlooked (and valuable) tools available to creatives.

What Is a Royalty Audit (in plain English)?

A royalty audit checks whether a company licensing your work has paid you exactly what the contract says they should.

It means verifying:

• Reported sales or usage
• Deductions and exclusions
• Royalty calculations
• Income from sub-licensing or new platforms

In short: “Trust, but verify.”

Why Creatives Are Particularly Exposed

Creative contracts are rarely simple. I see issues like:

• Multiple revenue streams bundled together
• Vague definitions of “net sales”
• New platforms not explicitly covered in older contracts
• International reporting inconsistencies
• Manual reporting errors that compound over time

Even small percentage errors, repeated year after year, can quietly cost thousands — sometimes more.

What Royalty Audits Often Reveal

In practice, royalty audits frequently uncover:

✔ Underreported sales
✔ Incorrect deductions
✔ Missed income streams
✔ Reporting errors rather than fraud
✔ Contract terms that need tightening next time

In many cases, the recovered income outweighs the cost of the audit. You may also have a clause in your contract that, if a certain underaccounting threshold is hit, the company being audited covers the cost of the audit.

But just as importantly, audits create transparency and reset expectations.

It’s Not About Conflict — It’s About Clarity

Many creatives avoid audits because they feel “awkward” or adversarial.

In reality, audits:

• Professionalise the relationship
• Encourage better reporting going forward
• Strengthen your position in future negotiations
• Protect the long-term value of your IP

If your work is being commercially exploited, verifying income isn’t aggressive — it’s responsible business ownership.

When Should You Consider a Royalty Audit?

You might want to explore one if:

• Royalty income has dipped without explanation
• Payments feel inconsistent
• Your work is licensed across multiple platforms or territories
• You’ve never independently checked the numbers
• You’re planning to sell, assign, or value your IP

Final Thought

Creatives pour years into their work.

A royalty audit ensures that when that work earns money, you receive what you’re entitled to — no more, no less.

If you rely on royalty income, it’s worth asking one simple question:

“How confident am I in the numbers I’m being paid?”