Companies rely on service providers to streamline their day-to-day operations. This is evident through the emergence of data centers, cloud computing, and software-as-a-service (SaaS) organizations.
Before we dive into SOC 2 audit steps, let’s understand the difference between SOC 1 and SOC 2. A SOC 1 audit helps the organization examine and report its internal controls relevant to its customer’s financial statements. A SOC 2 audit helps the organization examine and report its internal controls relevant to security, availability, processing integrity, confidentiality, and privacy.
A SOC 2 report is issued by a third-party auditor at a licensed CPA firm. The auditor conducts a detailed review of a company’s infosec systems and procedures to verify that they have a good controls system. The report assures the design and operating effectiveness of controls and outlines any potential risks for customers or partners considering working with the organization.
Steps for preparing SOC 2 Audit
1. Select a report type
Before starting the SOC 2 report process, ask yourself what kind of report your organization needs, a Type 1 or Type 2 report.
A Type 1 report typically says if the system controls are correctly designed, whereas a Type 2 report says if those controls function as intended.
|Type||SOC 1 Type 1||SOC 2 Type 2|
|Goal||States if the controls are designed properly||States if the controls function as mentioned|
|Timeframe||1-3 months||3-6 months|
2. Conduct a readiness assessment
A readiness assessment helps you determine your preparedness for a SOC 2 final audit. You can perform a readiness assessment independently or engage an auditing firm to complete your review. It is highly recommended to use a third-party auditor to conduct the readiness assessment – to pressure test controls, which the internal teams can miss. The auditor walks through the systems, processes, and controls that would be in the audit. At the end of the audit, the company receives a detailed report covering any weaknesses or gaps and recommendations to fix them.
3. Execute the remediation plan
If the auditor identifies any gaps in the initial readiness assessment, it’s time to fix them. Remember, gap analysis and correction can take up to a few months. Ensure that you have set up a project team with clearly defined roles and responsibilities to execute this remediation plan. A project manager must ensure that the plan is getting executed correctly and on time.
4. Define the scope
Plan and strategize to define the scope. People, location, policies and procedures, and the technology stack you use impact the security of sensitive data. Start by determining which of the Trust Service Criteria (TSC), such as security, availability, processing integrity, confidentiality, and privacy, you want to include in your scope while security is mandatory. Otherwise, conduct a risk assessment to identify internal and external risks to your organization to identify the controls to be implemented.
In a nutshell, what type of customer information you store and the process, you follow influence this decision.
Safeguard the information and systems against unauthorized access and disclosure of details.
Information and systems should meet your organization’s service objectives mentioned in SLAs.
Systems should perform their functions thoroughly and accurately to meet the organization’s objectives.
Encrypt the data, so no one uses, retains, or discloses clients’ personal data or information.
No system or automation tool should not disclose and use peoples’ personal information.
5. Select the auditor
With an unprecedented number of CPA firms performing SOC 2 audits, choosing the right auditing firm is overwhelming. In addition to the final audit, the ‘right’ auditor does a pre-audit to identify gaps, so you can streamline the process and be final audit-ready. It will also help you build a robust action plan to remediate the gaps and improve your infosec posture.
Here’s what you should look at while choosing an auditor to work with:
- Communication style
- Knowledge of tech stack
- Team availability and escalation SLA
We know this sounds overwhelming. Scrut experts will help you with your SOC 2 report.
Scrut Automation is an innovative and radically simple governance, risk, and compliance automation platform for growing startups and mid-market enterprises. With Scrut, Compliance teams can reduce ~70% of their manual effort in continuously maintaining compliance towards SOC 2, ISO 27001, GDPR, PCI DSS, HIPAA, and CCPA. Schedule your demo today to see how it works.