During royalty audits, what outcome is most commonly achieved?

• A. A confirmation that all royalties are perfectly calculated
• B. A discovery that rights ownership has changed
• C. Identification of misallocated or underpaid amounts
• D. Elimination of metadata errors automatically

Answer: (C)

Royalty audits are all about reconciling payments to actual usage and contractual terms. When auditors compare the licensee’s remittance records with the usage data, rates, and rights splits, the typical finding is that some royalties have been misallocated or underpaid. This happens because data can be mismatched across territories, time periods, or different rights holders (for example, misattributing a streaming play to the wrong label or confusing master and publishing splits). The result is an adjustment that may require additional payment or a correction in future remittances, rather than a flawless confirmation that every calculation was perfect. Ownership changes are not the common end product of a standard royalty audit, and metadata issues, while they can surface, aren’t automatically eliminated by the audit itself—they often need data updates and corrections.