SAP Audit Defense Case Study: UK Energy Utility Saves £2.1M by Resolving Audit Risk
Background
One of the United Kingdom’s largest energy utilities (with over 8,000 employees) depended on SAP to manage customer billing, operations, and finance.
The company had accumulated a mix of legacy SAP user licenses over the years of operation. Upon receiving an official SAP license audit notice, the IT department was alarmed.
Challenges
The SAP audit focused on user classifications and outdated legacy license types.
Many employees still had old license assignments that no longer matched their job roles or actual usage. The audit findings pointed to significant under-licensing in certain categories.
The utility was facing a potential £2.1 million true-up cost to reconcile these compliance gaps.
The key challenges were to prove compliance or quickly remediate any mis-licenses, all while avoiding a huge financial hit and keeping critical systems running for end customers.
Solution (How SAP Licensing Experts Helped)
- Audit Response Taskforce: The utility engaged SAP Licensing Experts to handle the audit response and remediation. A specialized team came on-site to work with internal SAP administrators, ensuring a full understanding of the company’s SAP usage patterns.
- User License Optimization: The experts performed a meticulous review of all SAP users and their license assignments. They discovered that thousands of users were assigned higher license types than necessary. For example, employees who only needed read-only access were holding expensive Professional licenses. The team systematically reclassified users to the correct license tiers (such as Employee Self-Service or Limited Professional), instantly reducing the compliance gap.
- Cleanup of Inactive Accounts: Dozens of SAP user accounts belonged to former employees or duplicate entries. The team retired these inactive accounts, freeing up licenses. This cleanup not only helped in the audit defense but also trimmed future support costs.
- Legacy Contract Assessment: SAP Licensing Experts analyzed the utility’s older contracts and SAP agreements. They identified clauses and historical entitlements that the SAP audit team had overlooked. By invoking those contractual rights (for instance, grandfathered license metrics from legacy contracts), they neutralized several alleged compliance issues.
- Negotiation & Settlement: With a much smaller compliance gap after remediation, the advisors entered negotiations. They worked with SAP to recognize the proactive corrections made. The result was a greatly reduced settlement, essentially limiting the utility’s cost to a minimal purchase of additional licenses at a pre-negotiated discount.
Outcome and Savings
Thanks to this swift and strategic response, the anticipated £2.1 million audit penalty was entirely avoided.
In fact, the remedial actions uncovered such a surplus of unused licenses that the utility was able to return a portion to SAP, receiving credit toward future purchases.
The energy provider emerged from the audit with zero penalties and a leaner license landscape. Additionally, the ongoing savings from right-sizing user licenses translated into a lower annual maintenance spend.
The engagement not only resolved the immediate audit risk but also left the utility in a stronger position to manage SAP licenses efficiently.
“We passed the SAP audit with no penalties and even found hidden savings in the process. It was a win-win – compliance secured and costs lowered,” — CIO, UK Energy Utility
