For outsourced systems and processes, the burden of ensuring appropriate security controls are in place to manage IT risks is often passed onto those service providers. To provide formal assurance to their customers, service organizations try to obtain SOC 2 (Service Organization Control 2) reports. Use this post to help you understand what SOC 2 is, why you might need/want a SOC 2 report, and some steps to prepare for your SOC 2 audit.
The American Institute of Certified Public Accountants (AICPA) established three SOC reports to assess the controls of service organizations: SOC 1, 2, and 3. SOC 1 deals with financial controls, while SOC 2 and 3 cover non-financial and operational controls.
The SOC 2 report is intended to provide assurance to the customers of service organizations around controls pertaining to security, availability, processing integrity, confidentiality and/or privacy. It is not a one and done report; it is a continuous commitment to uphold the stringent audit standards.
Because the auditing process is so rigorous, service organizations with positive SOC 2 reports are seen as capable of operating with efficiency and security and have a competitive advantage. In addition, they are able to win contracts with organizations that require their service providers to provide annual SOC 2 reports.
Start by asking why you want to obtain a SOC 2 report. Is it because of a contractual requirement or is it for your organization’s business strategy?
Remember, SOC 2 covers non-financial and operational controls. These include vendor management, corporate governance, risk management, and regulatory activities.
Once you’ve determined your goals and objectives, engage with SOC 2 service auditors and select one.
The SOC 2 audit examines a service organization’s compliance based on five trust services criteria (TSCs): security, availability, processing integrity, confidentiality, and privacy.
Not all five TSCs, though, may apply to your organization. For one, AICPA only requires security for SOC 2 audits; the other four are optional. Therefore, choose the TSCs that apply to your organization, your industry, and/or your customers. This will determine which processes and/or systems are within scope for your audit.
For more on the 5 TSCs, check out our post on SOC 2 compliance.
There are two types of SOC 2 reports, so choose the one that’s specific to your goals and requirements.
SOC 2 Type 1 checks your organization’s controls at a particular point in time. It’s a fast and efficient means to secure data and communicate the results to your customers.
SOC 2 Type 2 covers SOC 2 Type 1, but it also examines the controls’ effectiveness over time, say, for an entire year. Expect to have better assurance with SOC 2 Type 2 than SOC 2 Type 1.
Once you have determined the goals, scope, and report type, it’s time to prepare for your audit. Here are a few tips:
Zeguro’s Cyber Safety Platform offers several capabilities designed to simplify and accelerate SOC 2 compliance for small and medium-sized businesses, including employee security awareness training, web app monitoring, and security policies. For more information, visit https://zeguro.com/solutions/soc-2-compliance or sign up for a 30-day free trial.