Jen: This is The PKF Texas – Entrepreneur’s Playbook®. I’m Jen Lemanski and I’m back once again with Carlos Gomez, an audit manager, and one of the faces of PKF Texas’ Contract Compliance Services team. Carlos, welcome back to The Playbook.
Carlos: Thanks for having me, Jen.
Jen: So, we’ve been talking about different kind of audits throughout the series, and how about you share a little bit about what a royalty audit is.
Carlos: A lot of royalty audits that we performed is on behalf of a client who is not necessarily in a certain industry, whether it be consumer goods, toys, apparel, those types of things. And for this specific instance, we have a client who is in the automotive industry, and a way to build their brand recognition and loyalty is to have toys and have apparel. And so, a kid gets a truck, and his dad has a Ford F-150, and they get a Ford F-150 toy car for Christmas. It kind of builds that loyalty and brand loyalty.
Jen: So, when they’re building that brand loyalty, where does the royalty audit come in?