SOC 2 isn’t just about passing a test and getting back to business. In fact, SOC 2 isn’t about passing a test at all. Despite common misconceptions, SOC 2 is not a certification, but rather an attestation report. A CPA firm attests that an organization’s internal controls are designed effectively (Type I SOC 2), or designed effectively and operated effectively over a period of time (Type II SOC 2). In short, the auditor provides an opinion whether the internal controls meet the SOC 2 criteria.
And this is not just an abstract conceptual issue. Understanding what SOC 2 is actually for, and how implementing SOC 2 can create real value for your company, is key to making more strategically-informed decisions.
Why a SOC 2 audit is so important for your organization?
As the new year approaches, it’s time to revisit that SOC 2 compliance project you put on hold in 2022. Though daunting at first, SOC 2 compliance is critical for many cloud-based solutions that store customer data, ensuring your organization meets those security compliance demands from customers, has the highest levels of data protection, and wins more deals, faster. In short, a SOC 2 report provides the official ‘stamp’ of confirmation that your security systems, policies and procedures meet the high standards of the AICPA’s SOC 2 compliance framework.
So much more than a box-ticking exercise
It’s one thing if the law requires you to meet a certain standard. You have to go with the flow, tick all the right boxes to get certified, and then get on with the business of doing business.
These regulations may serve a useful broader purpose within the industry, but meeting them is often just a pain. You do what you need to do to meet the compliance rules, diverting as few resources as possible. Indeed, increasingly heavy compliance demands, especially due to the continuing increase of SaaS companies or companies using more SaaS tools, are a major factor in the rise of RegTech.
By contrast, SOC 2 compliance is not imposed on your business from the outside – apart from the competitive pressure of the market. There is no formalised business or legal requirement telling you to be SOC 2 compliant. Although, many clients will demand it or, at least, prioritise those that are. You don’t even ‘pass’ a SOC 2 compliance audit. As mentioned already, your auditor will issue an opinion on the efficacy of your internal controls.
SOC 2 compliance is, therefore, often more intensive and demanding than a routine tick-the-box compliance process, but ultimately, much more rewarding. However, for that very reason, you really need to understand why you’re choosing SOC 2 and whether it’s right for your business. And then you need to implement it thoroughly, without cutting corners.
How SOC 2 adds lasting value to your company
SOC 2 is renowned for its flexibility. It’s not a one-size-fits all process. Rather, businesses will select which SOC 2 controls they want to focus on, based on a careful strategic analysis of their business operations
In all circumstances, though, SOC 2 compliance should be thorough, systematic and comprehensive. Rather than applying a random assortment of security and workflow measures, becoming SOC 2 compliant means developing bulletproof organizational structures that protect sensitive data and improve the company’s dependability.
So while SOC 2 isn’t a certification, it is a powerful way to demonstrate that your organisation meets the highest levels of excellence, in terms of governance, risk management, transparency and reliability.
That’s an invaluable competitive edge when you’re entering a new market or looking to supply clients with strict procurement criteria.
Achieving SOC 2 success, right now and in the future
Now let’s get practical. Once we appreciate what SOC 2 is for and what SOC 2 can do for your business, we can appreciate that SOC 2 isn’t something you just do once and forget about. It’s an ongoing process.
After all, in order to become SOC 2 compliant you need to actually build and sustain first-class organisational controls.
That may sound daunting. After all, SOC 2 is complex and it needs to be implemented with care and attention to detail, or it risks not adding long-term value.
That’s why it is extremely valuable to consult with an expert if you are considering implementing SOC 2. The right advisory service will be invaluable and, not just for advice and guidance on how best to implement SOC 2. They should also advise on which SOC 2 controls are right for your business and help clarify your strategic compliance goals.
Secondly, you need tools that minimise the administrative burden of SOC 2 compliance. Powerful new technology automates the most laborious and time-consuming elements of SOC 2, reducing the burden on your team.
Integrated SOC 2 solutions
There’s no substitute for excellent strategic advice and effective digital tools. However, there is a way to maximize the value of both these elements, advisory and technology – which is by integrating them into a holistic SOC 2 solution.