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What Is SOC 2 Certification? Guide To Compliance & Certification

July 5, 2022
Author
Inkit Team

Proper data management entails quality storage and information security.

For most companies, data is at the core of what they do. For this reason, companies shouldn’t trivialize the importance of safely storing their records and sensitive documents.

SOC 2, aka System and Organization Controls 2, is a verification issuance for services rendered by trustee companies. It’s essential to be aware of partners' compliance in handling clients’ data. Hence, an auditor must verify operation protocols and design control according to organizations' standards. This helps companies maintain shared data and ensure its safety.

If you’re wondering how SOC 2 certifications work, who performs the audit, and if you should consider getting one for your company, here’s what we’ll cover below:

  • What Is SOC 2 Compliance And Why Is It Important?
  • 5 Trust Service Principles Of SOC 2 Certification
  • Why Is SOC 2 Compliance Important? 5 Benefits To Consider

What Is SOC 2 Compliance And Why Is It Important?

SOC 2 isn’t a certification per se, even though the name suggests that. 

The American Institute of Certified Public Accountants (AICPA) founded the policy as a way to look into possible vulnerabilities of an organization's services and offer solutions to alleviate them.

Keep in mind, the SOC 2 qualifications don’t dictate what protocols a company should have in place and the certification isn’t a requirement. 

Service organizations are at liberty to integrate any control of choice. That may even include all the conditions. 

Since there are different scopes of businesses, designs align with varying management principles.

There are 2 main types of SOC 2 reports. And the difference is as follows:

  • Type I SOC 2: This oversees partners’ design controls. The report describes the system of service of an agency and its structural management.
  • Type II SOC 2: The document contains systems' operational effectiveness to confirm they meet demands.

SOC 2 checklist includes various controls that cover safety rules. That includes:

  • System operations.
  • Access control.
  • Risk assessment.
  • Communication and information.
  • Logical and physical access controls.
  • Control environment.
  • Change management.
  • Risk mitigation.

Now, if you’re wondering how to get the SOC 2 certification, here’s what you need to know.

How does one get the SOC 2 certification?

Getting a SOC 2 certification isn’t instant. There are guides to follow for a successful audit. 

But typically, to get the SOC 2 certification, your company should go through the following steps:

  1. Mark out principles you’d like to have scrutinized. Even though security is the most paramount principle, you may also need to include other factors. Whichever way, you get to decide the manner of control you want for your records.
  2. Clarify monitoring. You can do this by outsourcing an external aid or control within your corporation. It will help identify some principles bound to be critiqued by your auditor.
  3. Cross-reference organization’s security protocols with selected principles. IT experts can assist with this process to check whether or not your systems are ready for official scrutiny.
  4. Contact a recognized CPA to get a formal SOC 2 audit. This process can be demanding in terms of time, paperwork, and resources. Often, it can span days or weeks. But this will help if you involve a third-party service in the process. That will rid yourself and your staff of the potential stress.
  5. Receive your SOC 2 report. An attestation report is a decider on how your certification process has gone. It details the extent of compliance of your security controls with the standards of the AICPA. You can then use the SOC 2 certification as a trust signal and display it on your website accordingly.

Who can perform the SOC 2 audit?

Only licensed certified public accountants (CPA) can perform a SOC 2 examination. Typically, ones that specialize in information and data security.

They use already given guidelines by the American Institute of Certified Public Accountants (AICPA), which embody the execution of the auditing process.

After independent CPAs have concluded audit reports, they must go through a peer review. This gives room for thorough cross-checks to ensure there are no errors. It also serves to check how appropriately the guides are obeyed.

Another way the CPA can do this is to include cybersecurity or IT professionals to put reports together. Although after that, they must undergo a separate round of review by the CPAs.

In some cases, a company may not meet sufficient trust criteria. Here, the CPA will give opinions on how the firm can improve its data security. 

However, in other scenarios, protocols are substantiated and endorsed. 

As much as you meticulously heed the pre-certification processes, you're good to go. If this is the case, your organization can include the label of the AICPA on its page. Customers gain confidence in your firm, resulting in an influx of patronage.

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Who needs the SOC 2 report?

Organizations that need a SOC 2 report or certification typically handle a lot of sensitive customer information or data. 

If you store client information in the cloud and need a report that their information is protected and private, a SOC 2 report might be ideal for you.

Some industry examples of organizations that need the SOC 2 report include:

  • Cloud service providers.
  • SaaS providers.
  • Legal industries.
  • Healthcare organizations.
  • Any other company that handles sensitive customer data.

Keep in mind it can take over a year to become SOC 2 compliant and get a type II report. So, it's best to get started early, even if you don't have a prospect requesting this report at the moment.

Most companies can expect to spend between $20,000 to $80,000 for a SOC 2 Type 2 audit

Now, let’s take a look at the trust service principles SOC 2 is based on.

5 Trust Service Principles Of SOC 2 Certification

Principle layouts by the AICPA are crucial to the process with other features of companies. 

The trust service principles of SOC 2 certification are as follows:

  • Availability.
  • Confidentiality.
  • Processing integrity.
  • Privacy.
  • Security.

Now, let’s explore each principle in detail.

1. Availability

Provisional products, services, and other user systems must align with the agreed terms of use. Data should also be usable and readily available.

Availability includes precautions like recovery plans, designed environmental protection, and maintenance of recent processing capacity.  

2. Confidentiality

When a particular piece of information is tagged sensitive, organizations should handle them as such. 

Personal and health information are perfect examples of this. 

This data should be shared, processed, and stored with care according to security and data policies.

It has measures for recognizing and protecting discrete data with safe disposal. 

See our full guide on document management lifecycle systems for more information on the stages your documents go through that need to be protected within your organization. 

3. Processing Integrity

For services with outlines and procedures, the report should have details as valid and accurate. 

An example of this is translational services involving financial institutions and online businesses. More importantly, the system processing must meet its market objectives.

Completeness, timeliness, and authorization are other constituting factors of credibility.

4. Privacy

Privacy is a little different from data confidentiality. 

The latter answers more on how and to whom a company transfers collected data. For the former, it applies to how they get information from the source. Prevention of data misuse involves personally identifiable information (PII).

Some subcategories under privacy include notice and communication of objectives, quality, enforcement and monitoring, disclosure, etc.

Other ways to protect sensitive information in this step include:

  • Classifying your data within a document management system.
  • Training your staff and employing the best security and data management practices internally.
  • Tracking and securing your devices.
  • Using user roles and permission settings so only specific people can access certain documents.

5. Security

Systems should have special protection against data breaches. 

This helps to control unauthorized activities capable of compromising data. Generally accepted principles of privacy (GAPP) are the recognized security protocol by AICPA. Data involving health, gender, race, etc., are monitored under GAPP.

Security tools include firewalls, malware installation, dual authentication, invasive detection, and more.

Now, if you’re wondering why all this matters, here’s what you need to know.

Why Is SOC 2 Compliance Important? 5 Benefits To Consider

Laying a compliance foundation for your company has enormous benefits. 

Essentially, with a SOC 2 Type 2 certification, you're demonstrating that your organization maintains a high level of information security.

Here are some other benefits you gain with a SOC 2 certification.

High standard of authenticity for clients

Among rival companies, SOC 2 grants your enterprise a competitive advantage

Customers are often searching for trustworthy vendors with safe systems of operations. The attestation is a way to put your services out as validated, thereby building a firm brand reputation.

Guaranteed security

SOC 2 reports keep clients’ and employees’ minds at ease against threats of breaches. This gives them the satisfaction that necessary protocols are adopted to ensure data safety.

Improved performance and efficiency

With the audit validating your design controls and business operations, you tend to offer better services. 

You can also track procedures internally, identifying and solving customer issues. It ensures processes are stable and, at the same time, progressive.

It gives your company the privilege to execute services on platforms requiring the certification

Some marketplaces mandate service reports before granting a go-ahead with transactions. If you’re in business with a finance institute, you may be required to tender the assessment.

With the certification, you have easy entry into almost any market. 

Cost-effectiveness

Adoption of SOC 2 audit requires robust capital. However, it depends on the company's scale and complexity of service. In addition to the procurement costs are overhead payments and complementary management software.

Initially, the price of getting a SOC 2 audit may seem to be ridiculous. But in the long run, the benefits make it worth every penny.

Conclusion

While SOC 2 compliance isn't a requirement for businesses, its role cannot be overstated.

To recap, service organization compliance policy inclines with different trust principles. What we covered above is the baseline for ensuring an organization is well equipped to handle customers’ data.

With a SOC 2 certification, you’re demonstrating that your organization maintains the highest level of information security. Which in itself can be a huge competitive advantage. And for customers looking to keep their information secure, you’ll have a huge trust signal being SOC 2 certified.

Inkit regularly undergoes security audits to ensure information security requirements, based on each of the five trust principles covered above. Meaning, establishing zero trust security protocols, your sensitive information will be safe within our document generation platform.

PS - Did you know Inkit is SOC 2 compliant? For more information, see how Inkit manages your security!

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