Are customers or partners already asking for proof you’re SOC 2 compliant? Or are you just trying to understand what you need to gain SOC 2 compliance? If either answer is positive, you’re on the right track being here.
SOC 2 compliance is a voluntary compliance standard for service organizations to align and standardize how customer data is managed. The American Institute of CPAs (AICPA) developed SOC 2 audits to ensure that customers' assets are not compromised and that organizations are aware of the security and financial risks.
With your software platform or API, a SOC 2 audit should be part of your minimum requirements so customers know you can be trusted with their data. Which, frankly, increases your ability to earn more revenue.
SOC 2 compliance means your business checks the security, and usually several more, Trust Services Criteria. You may not need all.
They are standards set by the AICPA and they are used to evaluate the suitability of the design and operating effectiveness of the controls relevant to the Security, Availability, Processing Integrity, Privacy, and Confidentiality of your organization’s information and systems.
What do we mean by “You may not need all”? The Trust Services Criteria isn't a checklist. Neither is SOC 2 compliance a strict standard that every company must abide by.
Your SOC 2 compliance depends on your product, API, website and/or services. This means your audit report only concerns criteria that are relevant to your business. The only exception is Security.
Security is the only criterion that must be present in a SOC 2 audit, no matter the type of organization. It is also called the common criteria because it's essential to all SOC 2 audits.
The 5 Trust Services Criteria are focused on specific things:
Security involves the protection of data systems from unauthorized access and unauthorized disclosure.
Availability ensures the system is available for operation as agreed between the question company and the user.
Processing Integrity ensures system processing is complete, valid, accurate, authorized, and timely.
Confidentiality means information that must remain confidential is protected according to all agreements.
The Importance of SOC 2 Compliance
Why should you get SOC 2 compliance?
To start with, your customers’ point of view changes and they see you as more trustworthy. It shows them you value them and their data.
When you need to partner or close a deal, clients may ask for this audit. Do you want to be unprepared when this happens?
As a direct benefit to you and your organization, passing a SOC 2 audit ensures you have processes and systems that keep you sustainable and profitable for the long term.
SOC 2 compliance can make or break your business. 71% of customers are unlikely to buy if a company loses their trust. The need for proof that your organization is SOC 2 compliant usually comes up during the sales process, near the closing stage. A lot of trust is lost when you can't provide a report they deem basic. So, a lot of deals fall through immediately.
Whatever your (expected) revenue, your organization does not want to continue to take that risk.
How to get a SOC 2 Audit
It's very common to hear of a SOC 2 certification. But there is no such thing. AICPA doesn't award certificates to companies to show SOC 2 compliance. So what can you show to prove or confirm that your organization has gone through a SOC 2 audit and is compliant?
SOC 2 audits are performed by independent and licensed CPA companies and them alone. No other type of company can provide a signed audit. Even if there's a CPA professional on board, the whole company must be independent before a true claim to performing SOC 2 audits can be made.
You need to review your controls, processes, and policies, organize them and properly document them. Some organizations present templates to prepare for a SOC 2 audit. These audits, however, are tailored by company, so while these templates may help you get started, they are nowhere near a substitute for a professional.
You submit a report and invite the CPA organization to verify the systems you've put in place according to the Trust Services Criteria related to your company.
So, is the first step to simply reach out to one? No.
One risk of doing that is getting a Qualified Report Opinion. Qualified opinions mean that your organization is not compliant with one or more of the Trust Services Criteria. This means you have to return to the company, review your processes again, and invite them for another audit, costing even more money.
There are numerous reasons for receiving a Qualified Report Opinion, but a top mitigator is getting externally and professionally prepared for your SOC 2 audit.
To pass an exam well, you need to prepare. To gain SOC 2 compliance in one go, you also need to prepare.
So how do you prepare? What do you need? Are there steps to go through?
Rather than weigh yourself down with these questions, find a trusted company that will guide you through all the stages needed and get your organization 100% ready for your SOC 2 audit.
Choosing A Preparation Company
When choosing how to prepare for your SOC 2 audit, there are three things to look out for:
1. Experience in preparing companies for SOC 2 audits
As much as the benefit of the doubt should be given to companies who have never prepared any for SOC 2 audit, it should not be your first move. Being SOC 2 compliant holds a lot of weight.
You want the company you choose to be versatile in preparing for SOC 2 audits and is audited itself.
2. Type of organization
Your type of service organization matters too. Claims can be made to cater to all kinds of industries, but niches are important so that common mistakes and loopholes in your industry can be anticipated. At Resilient, our focus is SaaS, HealthTech, Crypto/Blockchain, and EduTech organizations for SOC 2 audit preparation.
3. Communication and availability
Communication might seem a basic necessity in deals but with your company’s future riding on it, you might not be comfortable with the agency preparing you for the SOC 2 audit reaching out to you when they feel like it.
Rather, predetermined contact times should be set so everyone knows how, when, and where updates should be exchanged.
Is Getting a SOC 2 Audit Urgent?
If clients have requested them already, the answer is yes! Book a free consultation now to get started.
If it's something you just wanted to learn more about, now knowing the impact of a SOC 2 audit, you should put it on your “Urgent and Important” to-do list right now.
SOC 2 audit is recognized nationwide, and it is highly respected.
The expectations are that preparing for it costs a fortune, but that is not the case. Preparing for SOC 2 compliance costs less than 20% of a junior software developer's salary.
Ready to be SOC 2 compliant?