ISO 56005: Intellectual Property Audit: Inventory, Valuation and Risk Management

Juan Carlos Suárez D. 

Director of IP Management & Technology Transfer, Universidad El Bosque | Lecturer and International Consultant in IP Management & Technology Transfer.

María Camila Duque 

IP Management Coordinator, K-Intangibles IP Strategy & Tech Transfer | Lecturer and Consultant in IP Management.

1. Visibility for Decision-Making.

There is a recurring problem in most SMEs when they begin an IP management support process: the company does not know exactly what it owns. It knows its products, its customers, and its technology, but it lacks clarity regarding which of its intangible assets are protected, where they are protected, under whose ownership, and for how long.

This lack of visibility has direct consequences: unprotected innovations that end up in the hands of competitors, incomplete contracts that generate ownership disputes, and unidentified infringement risks that emerge just when the company enters a new market.

An IP audit seeks to address this problem precisely. It is not an administrative exercise nor an exclusively legal one; it is a management tool that provides a clear, structured, and actionable view of the company’s intangible assets and aligns that reality with business objectives.

Within the framework of ISO 56005, the audit constitutes a fundamental step: without knowing the company’s current IP position, any protection or commercialization strategy rests on fragile foundations.

“It is impossible to manage strategically what is not known. The audit transforms invisible assets into actionable information.”

2. What Is an IP Audit and When Should It Be Conducted?

An IP audit is a systematic process that enables the identification of existing IP assets, the evaluation of their legal and strategic status, the analysis of associated risks, and the identification of protection or exploitation opportunities that are not being leveraged.

For European SMEs with operations or plans in Latin America, it is recommended to conduct an audit at the following times:

• Before entering new markets: to identify infringement risks and verify the availability of trademarks or technologies in the target country.
• Before seeking investment: investors ask about IP; having a clear and valued inventory significantly improves the negotiating position.
• Prior to establishing R&D partnerships and/or co-development projects: to define in advance what each party contributes and how the results will be managed.
• During growth or restructuring processes: to update the IP strategy according to the company's new reality.
• Periodically (annually or every two years): as a systematic management practice, not only as a response to risk situations.

3. The Audit in the Context of Innovation and Strategy.

ISO 56005 establishes that IP should be managed throughout the entire innovation process, from the identification of opportunities to the commercialization of results. Within this framework, the audit plays a connecting role: it verifies that the assets generated through innovation are properly identified, protected, and aligned with business strategy.

A properly conducted audit not only shows where the company stands today, but also where it should be and the steps required to get there.

4. Practical Stages of an IP Audit.

The following outlines a structured and practical approach for SMEs, regardless of their sector or size.

    4.1 Identification of assets. 

The first step is to build a complete inventory of IP assets. This includes reviewing:

• Filed or granted patents.
• Registered trademarks (national and international).
• Industrial designs.
• Software and works protected by copyright.
• Know-how and trade secrets.
• Databases and data assets.
• Relevant contracts: licenses, NDAs, collaboration agreements and co-development agreements.

Good practice: involve different areas of the company-technical, commercial, and legal-in this process. IP does not live only in the legal department; it lives in R&D teams, operations, and commercial teams.

EU–LATAM Example: an SME that has developed technological solutions in collaboration with local partners in Latin America may discover that part of its critical know-how is in the hands of those partners, without any formal protection or ownership agreement.

    4.2 Organization and Structured Inventory. 

Once the assets have been identified, they must be organized systematically. The minimum information that should be recorded for each asset includes:

Tools as simple as a properly structured spreadsheet may be sufficient to get started. The important thing is that the inventory can be updated and is accessible to decision-makers.

    4.3 Valuation and Prioritization

Not all assets have the same strategic impact. An important part of the audit consists of setting priorities: identifying which IP is critical for the business and which is less relevant in the short and medium term.

The most relevant valuation criteria for an SME are usually:

• Direct contribution to revenue or margin protection.
• Competitive differentiation: Does this asset make the company more difficult to replicate?
• Market potential: Does it have prospects in target markets?
• Ease of exploitation: Can it be licensed, transferred, or used to generate new business?

Practical example: a technically sound patent but with no immediate commercial application may have lower priority than a trademark that the company urgently needs to register in a Latin American market before starting operations there.

    4.4 Risk Analysis

Risk identification is often the most valuable result of an audit. The main risks to evaluate are:

“Launching a product in a new country without first verifying the existence of local patents or trademarks may prevent market entry and generate significant legal costs.”

    4.5 dentification of Gaps and Opportunities:

Beyond risks, the audit also reveals opportunities that the company was not taking advantage of, such as:

• Assets with protection potential that have not yet been registered.
• Existing IP that could be licensed to third parties to generate additional income.
• The need to strengthen the portfolio in specific markets or technologies.

• Collaboration or co-development opportunities that require strong IP as a foundation.

   

5. Practical Tools for the Audit.

An IP audit does not require complex structures. For an SME, the most useful and accessible tools are usually:

• Invention disclosure form: to systematically record innovations generated within the company prior to their disclosure.
• Asset valuation matrix: strategic value vs. cost of protection vs. level of risk.
• Contract checklist: NDAs, licences, co-development agreements and employee onboarding.
• Searches in public databases (Espacenet, LATIPAT and national databases) to check for prior art.

• Intangible assets map: integrated visualisation of the IP portfolio and its relationship with the business model.

   

6. IP Audit Checklist for SMEs (EU–LATAM Context).

7. Specific Recommendations for European SMEs with interest in Latin America:

• Prioritise assets that have a direct impact on target markets; not all require comprehensive protection.
• Ensure clarity of ownership before entering partnerships, particularly in international projects with local partners.
• Tailor protection to the specific country: what is sufficient in Europe may be insufficient or inappropriate in certain markets within the region.
• Strengthen confidentiality management: trade secrets only work if there is an active and documented policy.
• Make auditing a regular practice, not just a response to crises or change.

• Support local auditing and consultancy where necessary. Each national system has specific features that require specialist knowledge.

   

8. Conclusion.

The IP audit is the starting point of any effective strategic management of intangible assets; without it, the company operates with an incomplete map: it knows where it wants to go but does not fully understand the resources available to it or the obstacles it may encounter along the way.

For European SMEs with ambitions in Latin America, this process is especially relevant. The diversity of markets, the different levels of legal protection, and the region’s own dynamics make operating without visibility over IP an unnecessary risk.

Following the ISO 56005 approach, the audit transforms IP into a manageable, measurable asset aligned with business objectives. And that is, ultimately, the first step toward turning it into a real competitive advantage.

“A company that knows its IP well can protect it better, exploit it more effectively, and take fewer risks. The audit is the starting point.”

About the Authors

Juan Carlos Suárez Delgadillo. Director of IP Management & Technology Transfer at Universidad El Bosque and Strategy Director at K-Intangibles. Lawyer from Universidad Externado de Colombia, with a Master's degree in Intellectual Property from the University of Ankara (Turkey) and WIPO. Specialized training in IP Management and Technology Transfer in Israel, France, the United States, and Singapore. International Consultant and Trainer in IP Management and Technology Transfer for WIPO. 

🔗linkedin.com/in/ipstrategistjuancarlossuarez

María Camila Duque Díaz. IP Management Coordinator at K-Intangibles IP Strategy & Technology Transfer. Lawyer from Universidad de Caldas, with a Master's degree in Intellectual Property and Innovation from Universidad de San Andrés (Argentina) and WIPO, and a Specialization in Intellectual Property and New Technologies from Universidad Externado de Colombia. Advanced Training in IP Commercialization in Singapore. Consultant in IP Management with specialized experience in the university sector across Latin America.

🔗 linkedin.com/in/maria-camila-duque-diaz 

In other episodes...

Article 1: “Strategic Intellectual Property Management in SMEs: An ISO 56005-Based Approach”

Article 2: “How to Define an Intellectual Property Strategy Aligned with the Business Model?”

Article 4: “IP Due Diligence: preparing for investment, partnerships, and international operations”

Article 5: “From Protection to Exploitation: Operating IP with a Strategic Approach”