To ensure you are paying the right amount of licensing fees, we are implementing a program to help you report your royalty bearing sales. Incorrect reporting may result in incorrect royalty payments, either too little or even too much, so our new ‘Royalty Examinations’ are designed to put that right.
Our Royalty Examinations form part of a larger examination program that we are carrying out worldwide. Its main goal is to ensure that reports from all our licensees are made in a consistent manner. The Royalty Examinations are being conducted by independent certified public accounting firms, one in Europe and one in the U.S.
In Europe, Deloitte is acting on our behalf, and their first Royalty Examination was a great success. Through working closely with our licensees, we have been able to fine-tune the royalty reporting process and align on existing patents and how these apply to the solutions they are bringing to the market, in an open, collaborative way.
“As an independent party, Deloitte’s role is not only to report on facts but also to bring value to Philips and its licensees, increasing transparency and building trust,” says Bart van Oosterhout, Senior Manager Contract Risk and Compliance, Deloitte. “We are looking forward to working further on this innovative program.”
Matthias Schwab, from Steinigke Showtechnic GmbH, commented on their Royalty Examination, “Even though audits are often not highly appreciated, the approach of the team was in every aspect professional and serious. We were always kept up-to-date and as a result of their good advice, were able to immediately adjust and optimize our internal processes to address the minor issues recognized in our reporting.”
The program will be of great benefit to everyone, especially given the increasing number of licensees. In fact, we recently welcomed our . The growth in membership is a sign of our licensing program’s tremendous success. More importantly, the growth bears testament to the importance of LED technology in lighting applications.