What is SOC 2 Compliance? (And Why You May Want to Achieve it)

What is SOC 2 compliance is a question that many business owners don’t know the answer to, or may be confused about.

In this blog post, we will attempt to clear up any confusion and provide a detailed explanation of what SOC 2 compliance actually is. We’ll also compare SOC 2 compliance to other forms of compliance, in order to show why becoming SOC 2 compliant is so important for businesses today.

What is SOC-2 Compliance?

SOC 2 compliance is a type of certification that provides assurance to customers and clients that the service provider has successfully met specific criteria (discussed below) relating to their internal controls over data security, confidentiality, and privacy.

This certification is governed by the American Institute of Certified Public Accountants (AICPA), under its Service Organization Control framework. As far as compliance goes, SOC 2 applies to specifically focused-on trust principles related to security, availability, processing integrity, confidentiality, and privacy.

What is SOC 1 and SOC 2 Compliance (Plus SOC 3): Explaining the Difference

There are three other types of SOC compliance: SOC 1, SOC 3, and SOC for Cybersecurity. These all revolve around similar trust principles as the SOC 2 statement on standards, but type 1 and type 3 differ in their specific focus:

• SOC 1 focuses on financial statements and reporting controls
• SOC 2 specifies how organizations should manage customer data
• SOC 3 is a shorter, publicly available version of the SOC 2 report
• SOC for Cybersecurity focuses on an organization’s cybersecurity risk management program.

Why Should Your Business Be SOC 2 Compliant?

Obtaining SOC 2 compliance shows both current and potential clients that your business takes customer data protection seriously and has measures in place to protect their sensitive information.

This can instill trust in your clients and ultimately lead to more successful partnerships and business growth.

In addition, many industries (such as healthcare or finance) require that their partners or vendors have achieved SOC 2 compliance before doing business with them. Failing to obtain this certification could result in losing out on valuable opportunities for your business.

What is SOC 2 Type Compliance: The 5 Trust Services Criteria of Certification

In order to achieve SOC 2 compliance, your organization must adhere to the following trust principles:

1. Security
   The system is protected against unauthorized access, use, or modification.
2. Availability
   The system is available for operation and use as committed, or agreed.
3. Processing Integrity
   System processing is complete, accurate, performed within a reasonable period of time, and authorized.
4. Confidentiality
   Information designated as confidential is protected consistent with the commitments in the service provider’s contract.
5. Privacy
   Personal information is collected, used, retained, disclosed, and disposed of in conformity with the commitments in the service provider’s contract and with criteria set forth in Generally Accepted Privacy Principles issued by AICPA/CICA (Canadian Institute of Chartered Accountants).

How to Create a SOC 2 Compliance Report

In order to create a SOC 2 compliance report, your organization must first undergo a thorough audit by an independent third party.

This involves extensive review and testing of policies, procedures, and access controls in place related to the trust principles mentioned above.

Once the auditor has collected all necessary information, a report will be issued detailing the results of their findings. If any deficiencies or risk areas were identified during the audit, these would need to be addressed before achieving full SOC 2 compliance.

5 Challenges to Becoming SOC 2 Compliant (and How to Overcome Them)

1. Lack of Resources & Expertise

It can be difficult for small or newly established businesses to dedicate the necessary time and resources towards becoming SOC 2 compliant. One solution is to partner with a third-party service provider that specializes in SOC 2 compliance and has the expertise to guide your organization through the process.

2. Inadequate Policies & Procedures

Many organizations struggle with having clear, up-to-date policies and procedures in place related to information security and privacy. It’s important to regularly review and update these documents as needed, ensuring that they align with current industry standards and regulations (such as the standards for attestation engagements).

3. Weak Risk Management Processes

Identifying potential risks and having a plan in place for how to handle them is crucial for SOC 2 compliance. Consider conducting regular risk assessments and implementing a formal incident response plan to address any issues that may arise.

4. Lack of Employee Awareness & Training

It’s important for all employees to understand their role in protecting sensitive data and adhering to compliance standards (whether this data is stored in data centers or on-premise). Providing regular security awareness training can help ensure that everyone is on the same page and following proper procedures.

5. Insufficient Monitoring & Testing

Ongoing monitoring and periodic testing of your organization’s internal controls can help ensure that they are effectively implemented and operating as intended. Consider automating certain processes or utilizing tools to make this process more efficient and effective.

Becoming SOC 2 Compliant with the Help of a Leading Managed IT Services Provider

Becoming SOC 2 compliant can seem like a daunting task, but it is crucial for the success and growth of your business.

Remember, at the end of the day, achieving SOC 2 compliance shows both current and potential clients that your business prioritizes protecting their sensitive information.

If you feel that you would benefit from having a leading IT managed services provider assisting you with your SOC 2 compliance needs, please contact us today to set up a free consultation where we can work to identify your specific needs together.