With the tremendous global growth of technology licensing, a significant amount of revenue leakage occurs as a result of poorly written license agreements. Although protected by patents, the intended and anticipated royalty income from such arrangements may never be accurate. For example, the royalty rate structures may take many forms e.g. a fixed dollar amount per unit distributed of product incorporating the licensed IP to various percentage royalty rates dependent on factors such as sales targets or product version upgrades.

The complexity of the reporting requirements for the licensee is also a major factor in unintentional under-reporting, particularly when a product may contain several different patented IP technologies (software or hardware), each with a different reporting basis for royalty calculations. With high unit volumes of global distribution, especially for electronic mobile devices, any minor error in the royalty calculation methodology could result in millions in mis-reported revenue.