All you need to know about SOC 2 Compliance
Data Security is more important to organizations all over the world now than it was twenty years ago. The rise of third-party SaaS and cloud-computing providers has increased the need for data security. Mishandled data by network providers can leave enterprises vulnerable to cyber attacks such as malware installation, extortion, and data theft.
What is SOC 2 Compliance
SOC 2 is an auditing procedure that ensures the correct and secure management of all your data, interests, and the privacy of your clients. SOC 2 compliance is a minimal requirement for any security-conscious business that is hiring a SaaS provider.
The American Institute of CPAs (AICPA) developed SOC 2 as a compliance standard organizations should follow. SOC 2 defines the criteria for the secure management of customer data on five “trust service principles”. Security, availability, processing integrity, confidentiality, and privacy make service providers SOC 2 compliant.
A SOC 2 report is unique to each organization. Your business practice must design its own controls to be SOC compliant with one or more of the trust principles. SOC reports contain important information on how your service provider manages your data.
Who Needs a SOC 2 Report
Any organization that hires third-party Software as a Service (SaaS) providers, cloud computing providers, or stores information on the cloud must be SOC 2 Compliant. Organizations that provide those services as well must be SOC Compliant.
What are the types of SOC Reports?
There are two types of SOC reports:
Type I describes your vendor systems and whether their design is compliant with the relevant trust principles.
Type II details the effective operation of those systems.
Which SOC 2 report Should I Get?
Choosing which SOC 2 report to get, depends on the duration of coverage requested.
SOC 2 Type I describes the systems and controls you have in place at a particular moment. An auditor checks your controls to ensure you meet the relevant trust principles.
SOC 2 Type II assesses the effectiveness of your processes and controls in providing the desired level of data security over a period of time. The coverage for SOC 2 Type II is six months at the least.
The goal of any organization is to have a SOC 2 Type II that lasts for twelve months. A new type II audit is then conducted every year to ensure continued coverage. A SOC 2 Type I audit is a lot quicker to conduct and can help show the current controls of an organization at a point.
What Do I Have To Do To Get a SOC 2 Certification?
To become SOC 2 compliant, an auditor needs to do a SOC 2 audit on your system and controls. Outside auditors issue SOC 2 certifications. They assess the level of compliance you have with one or more of the five relevant SOC 2 trust service principles.
The five SOC 2 trust service principles are:
- Security
The SOC security principle encompasses the protection of system resources against unauthorized access. Software Access Controls help prevent the theft of data, software abuse, breaches, and the irregular alteration or disclosure of information.
Some examples of IT Software Access Tools are Network and Web Application Firewalls (WAFs), two-factor authentication, and intrusion detection tools.
- Availability
The availability principle refers to the accessibility of the system, products, or services to both parties. The minimum performance level for a system’s accessibility is to be set by both parties.
While the principle does not address a system’s functionality, it does involve security-related criteria that may affect availability. Network performance and availability, security incident handling are crucial here.
- Process Integrity
The Process Integrity principle checks whether a system achieves its intended purpose. That is, it delivers data at the right time with precision and authority.
An important note. Process integrity does not always imply data integrity. This means that process integrity is incapable of detecting errors in data before processing. Quality assurance procedures alongside effective data processing can help ensure process integrity.
- Confidentiality
Data is confidential if only a select group can access it. Examples are, personnel information, financial information, e.t.c.
Encryption on data during transmission ensures its confidentiality. Firewalls and access controls protect data during its transmission between systems.
- Privacy
The privacy principle covers the collection, use, retention, disclosure, and disposal of personal information in accordance with your organization’s privacy policy and the AICPA’s generally accepted privacy principles (GAPP).
Personal information such as name, address, and Social Security Number as well as information related to health, race, and sexuality always requires protection. Controls must be in place to ensure protection from unauthorized access.
What You Need to Ace your SOC 2 Audit
The SOC security principle is always checked by an auditor. It is always needed to satisfy an audit. Once you have these controls down you are well on your way to acing a SOC 2 audit. The controls addressed are:
- Logical and access controls: How you restrict, manage and authorize data to prevent unauthorized access.
- System Operations: How you manage your system operations to monitor possible deviations from set procedures.
- Change Management: How you implement a controlled management process change while preventing unauthorized changes.
- Risk Mitigation: How you identify and develop risk mitigation practices when dealing with business disruptions or the use of vendor services.
ITASC Helps you Become SOC 2 Compliant Quickly
ITASC is a leader in SOC Auditing. We undergo annual SOC 2 audits to ensure we always remain compliant with all five trust service principles. We can help your organization become SOC 2 compliant quicker than you can imagine.