The Service Organization Control (SOC) standard is a well-known, but often misunderstood, approach to cybersecurity. It’s not mandatory, it has several methods, and some attestations involve different types of reports and assessments.
Sometimes, the most difficult challenge is understanding the breakdown between reports. While SOC 2 is the most well-known and deployed assessment on the market, many organizations opt to get a SOC 3 report.
What Is SOC 2 Reporting?
It’s hard to discuss SOC compliance without discussing SOC 2 as a baseline.
The American Institute for Certified Public Accountants (AICPA) released the SOC standard to help financial institutions manage specific data control and management areas. SOC 2 breaks these areas down along 5 “Trust Services Criteria,” which include:
- Processing Integrity
The entire goal of these criteria is to help organizations implement technical controls, institutional processes and policies to protect client data while it is stored or processed by their systems. These controls support various priorities like obfuscating data through encryption, setting up anti-malware and firewall protections, maintaining data privacy from internal and external users, and ensuring that data can be used effectively throughout the organization with unexpected corruption or deletion.
SOC 2 reports require an external audit and certification from an authorized CPA with certification capabilities.
SOC 2 reports are important for a few reasons. Financial companies will often undergo regular audits to ensure that their systems meet minimum requirements in certain areas (although, for all SOC 2 reports, the security criteria are mandatory across all audits).
Furthermore, these reports instill a sense of trust with customers and clients. It demonstrates a commitment to excellence and integrity, alongside the willingness to perform due diligence on all systems used to handle data.
Alongside SOC 2 reports (which will include security controls), organizations can undergo SOC for Cybersecurity audits to demonstrate their ability to implement a compliant risk assessment program. This certification is intended to emphasize risk and cyber defenses for businesses outside the SOC 2 baseline.
SOC 2 is significant because, without a SOC 2 report, your organization cannot get a SOC 3 version.
What is a SOC 3 Report?
A SOC 3 report is a generalized version of the SOC 2 in-depth report used for public consumption, often for marketing or notification purposes.
A SOC 2 report will contain the following elements:
- An Opinion Letter: The auditor will, on the conclusion of the assessment, provide an opinion of the audit based on their findings; This opinion will provide one of three ratings:
- Unqualified: Literally, an unqualified success. The organization passes.
- Qualified: The organization is close to success but needs to implement changes to reach SOC 2 certification. Technically a failure.
- Adverse: The organization failed to meet several criteria. Also, a failure.
- A Management Assertion: This section is a notice from the assessed organization on their systems, how they work, and how operations fit into the SOC assessment.
- Detailed Descriptions of the System: This includes breakdowns of assets, resources, personnel, and any relevant components assessed in the system.
- Results: The tests conducted, a description of those tests, and a listing of the results.
- Optional Information: If the auditor believes commentary or notes are justified as part of the report.
As might be obvious from reading this, a SOC 2 report may contain sensitive information. The inner workings of an IT system, implemented security controls, proprietary implementations or policies–basically, the organization’s inner workings.
This presents a problem. While an organization may achieve SOC 2 attestation, the report may be that they cannot publish commentary and results from the auditors without disclosing company secrets or private data.
That’s where a SOC 3 is useful. Essentially, the SOC 3 report is a collection of select elements of the SOC 2 report that will generally include:
- The auditor’s opinion letter
- The Organizational Management Assertion
- A List of Tested Services with Descriptions
- Contact Information
Under the SOC 3 report, a reader can see what the auditor said about the audit, what the company asserted about its services, what services were tested and if the company passed.
Many companies choose to undergo SOC 3 for the main purpose of advertising their adherence to SOC requirements. In some cases, simply stating SOC 2 compliance is enough for branding and marketing. Still, more technically focused companies (like Amazon and Google) make their SOC 3 reports public to show their commitment. Furthermore, many organizations will package SOC 3 reports into marketing assets if the auditor provides good comments about their performance.
Complete Comprehensive SOC Audits with Continuum GRC
SOC 1, SOC 2 and SOC 3 serve as an essential and informative part of any company’s technical reporting. SOC 1 demonstrates security related to third-party partners. SOC 2 is a prominent part of the security and technical auditing industry. SOC 3 provides opportunities to engage potential customers with informative discussions of security capabilities.
SOC reports are like any other form of compliance: regular audits and system maintenance. These processes can swamp a business under documentation and preparation –especially if they aren’t ready to streamline that process.
Compliance isn’t just another business process. It is its own practice that calls for expertise and automation. Continuum GRC provides automation and auditing support for SOC reporting, including all three reporting paths. Unlike other SOC auditors who meet minimum requirements as a CPA, we are a security-first firm that achieved our CPA licensing to provide critical compliance support for the industry.
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Call Continuum GRC at 1-888-896-6207 or complete the form below.