What Is SOC 2 Compliance? FAQs for Business Owners
If you’re a business owner, you may have heard about SOC 2 compliance and wondered if it’s something that applies to you. What does it mean to be SOC 2 compliant? Do you need a SOC 2 audit?
Fortunately, getting answers is easy with our helpful guide about this common type of compliance. We’ll explain what it means to be compliant, how long it takes to become compliant, how to receive an audit, and more.
What Is SOC 2 Compliance?
The term SOC stands for Service and Organization Controls. So what is SOC 2 compliance? This is a requirement for technology companies that relates to their ability to report on how they design their controls. It is intended as a minimum standard ensuring that third-party companies are securely handling data and protecting their client’s privacy.
The “2” in SOC 2 compliance refers to the type of report created by auditors. (There are also SOC 1 and SOC 3 reports, which we will discuss later.) A SOC 2 report is highly confidential and should not be shared outside of the company.
Compliant companies are able to show how they test and effectively operate controls for any service organization. This is based on a set of points called the Trust Services Criteria (TSC). The categories of TSC include:
- Processing integrity
Who Should Be Concerned with SOC 2 Compliance?
Any companies that store or process data in order to provide a service to other businesses should be concerned with SOC 2 compliance. These types of companies might include cloud computing, SaaS, or payment processing companies.
Becoming SOC 2 compliant gives your company an edge against the competition, shows your clients that your company is trustworthy, and helps you avoid data breaches. In fact, many companies refuse to work with a service provider that is not SOC 2 compliant. For this reason, not being compliant could be one of several possible performance killers for your company.
Consider SOC 2 compliance as a requirement as essential as ISO 27001 certifications. Almost every type of technology company or cloud computing company today touts their SOC 2 compliance and can verify their status whenever a client might want to see it.
Who Conducts a SOC 2 Compliance Audit?
Now that you understand the importance of this type of audit for tech companies, you may be wondering how to go about becoming compliant.
In order to be SOC 2 compliant, you must have an audit done by someone who is certified to do so. So who can perform a SOC 2 audit?
This type of audit can only be done by an independent Certified Public Accountant who is trained in the most recent types of SOC audits. These are defined by the AICPA (American Institute of Certified Public Accountants). Some auditing firms may not be certified as CPAs, so it’s important to insist upon the credentials of your auditor. If the audit is conducted by a non-CPA firm, the SOC 2 report would not be valid and would have to be done again.
How long does it take to get SOC 2 compliance? Getting reporting processes complete takes an average of somewhere between 6 weeks and 3 months, but it could take up to 18 months in some cases. The time difference depends on the complexity of the report.
How Often Should SOC 2 Compliance Be Conducted?
SOC 2 compliance audits should be conducted about once a year. In many cases, however, it may be appropriate to have audits done more often. The frequency of the audit should depend on the company’s goals and objectives.
Some companies opt to get a SOC 2 audit every six months. These companies may have very real concerns about the security of their data and want to keep a close eye on their compliance.
What Are the SOC 2 Compliance Requirements?
TSC offers a detailed list of SOC 2 compliance requirements. These requirements mainly deal with four categories, including:
- Control access: This refers to both the logical and physical accessibility of controls. How are controls restricted and managed? How is unauthorized access prevented?
- Operations: All operations should be defined by a clear set of procedures. Any variance from set procedures should be easy to detect and stop.
- Data management: Any time data management is transferred, there should be a secure process to avoid unwanted changes.
- Risk mitigation: Compliant businesses should have reliable procedures in place for handling potential disruptions.
Other compliance requirements deal with the availability of data, the integrity of data processing, confidentiality, and privacy.
What Are the Other Types of SOC?
There are other types of SOC—specifically, SOC 1 and SOC 3. A SOC 1 report is important for companies whose operations may influence their Internal Controls over Financial Reporting. A SOC 3 report is similar to a SOC 2 report, but it is not as comprehensive and is intended for public viewing.
There are two types of SOC 2 reports. While both types measure the controls against the trust service principles, the first one is like taking a snapshot of one point in time, with the second report measuring a period over at least 6 months.
How Do You Know if Your Outside Service Providers Are SOC 2 Compliant?
You can find out if your outside services providers are SOC 2 compliant by asking to see their certification. As we mentioned previously, many service providers advertise their compliance, but you will still want to check the certification to make sure it is valid and up to date.
Hiring a SOC 2 Compliant Call Center
If you’re outsourcing your customer service (or any other aspect of your business), it’s important to choose a company that is SOC 2 compliant. Choose ROI Call Center Solutions and you can trust us to remain SOC 2 compliant when handling your customers’ information. We value integrity and transparency in every type of service we handle.
Learn more about how ROI Solutions can help your business save time and resources today.