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5 Checklist for SOC 2 Compliance Audits for SaaS Companies in 2022

5 Checklist for SOC 2 Compliance Audits for SaaS Companies in 2022

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Most consumers worry about how companies handle their data, especially personally identifiable information (PII). The same applies to enterprise clients dealing with anxious customers and strict regulators. So, they can not gamble with data security or anything that soils trustworthiness.

The increasing cybersecurity risks make cloud and SaaS vendors prime targets. About 80% of firms have experienced cloud cyber breaches in the last 2 years alone. Hence, companies, especially tech entities, use data protection as a competitive edge. Having a good cybersecurity team is a good way to protect your systems. 

However, you must show your stakeholders that they are in safe hands. One way of doing so is through sound internal control policies. For tech companies, getting SOC 2 compliance is a compelling trustworthiness badge. SOC stands for service organization control and includes policies for robust internal control. 

SOC 2 compliance improves your security posture and drives competitive leverage. In this article, you’ll learn about SOC 2 compliance and the factors to consider to be compliant. 

What Is SOC 2 Compliance?

What Is SOC 2 Compliance?

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SOC 2 is a compliance standard for service providers created by the American Institute of CPAs (AICPA). The AICPA guides companies on how to manage customer data and meet certain compliance requirements.

SOC 2 reports can be designed to meet each company’s needs. The framework covers a broad range of controls: 

  • Operational 
  • Technical 
  • Informational security controls. 

Thus, it has a high level of customization and can include other standards too. For example, SaaS and cloud vendors can use the Cloud Security Alliance (CSA) assessment. 

There are other frameworks like COBIT, COSO, etc. Your chosen framework should be suitable to your needs and SOC 2 criteria. SOC 2 compliance audits level up your risk management. Besides, it wins your vendors’ and customers’ trust. You’ll have demonstrated your ability to secure data and systems.

However, SOC 1 should not be confused with SOC 2 standard. SOC 1 highlights the company’s internal control design and adherence to the trust principles. 

In contrast, SOC 2 compliance audit evaluates the operational efficiency and compliance of the internal control systems. It follows AICPA’s Trust Services Criteria:

  • Security: You have protection and safeguard against unauthorized access.
  • Availability The data and system will be available and accessible as per the service agreements.
  • Integrity: It keeps the data from explicit changes without prior permission.
  • Confidentiality: It keeps the sensitive data safe from unauthorized disclosure.
  • Privacy:  It involves safeguarding personally identifiable information and its use.

Checklist for SOC 2 Compliance Audits 

  1. Define Company Goals and Applicable Framework 

You should have a goal for conducting the SOC 2 compliance audit. It could be to assure your clients or achieve a business advantage etc. 

Whatever the reason, it is significant to know achieving SOC 2 compliance will improve your company. You should also know the cost of the process in terms of time and resources. It will help plan the process to avoid any conflict with the regular running of company operations. 

So, you should ensure your internal controls are optimized for a smooth SOC 2 audit. Also, ensure your chosen framework will effectively evaluate what you already have. As mentioned earlier, CSA is gaining traction amongst SaaS and other cloud vendors. 

However, be open to other frameworks as well based on your objective of the SOC 2 audit. It will help check your readiness to avoid overlooking any SOC 2 security control policy gaps. 

  1. Select An Auditing Firm 

With a clear objective, your next checklist is selecting the best and most appropriate auditing firm. Your top pick should be trustworthy and have extensive experience. Also, it should automate some of the workflows for easy compliance management. 

You can also consider the following for your chosen auditing firm:  

  • Procedure and policy management provisioning. 
  • Security and training awareness suite. 
  • Vendor risk monitoring support. 

The ultimate goal is automating the whole process for continuous monitoring and compliance. It gives you complete visibility on audit and SOC reports alongside readiness assessments. 

A firm that provides a dedicated SOC compliance platform for simplified workflows and management is a bonus. You can read more on important features your chosen firm should have here

The bottom line is, you should have a single platform to manage all your SOC compliance requirements and features 

The auditor will assess your SOC 2 security controls and processes and approve the compliance audit. With your goals in mind, the auditor will help you get the maximum customer data protection. 

  1. Know the Scope and Check Preparedness
Know the Scope and Check Preparedness

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This third step involves selecting which of the five service criteria for auditing. For SaaS companies, security is a common criterion to select for SOC 2 compliance audit. 

But, your selection is at the discretion of your SOC 2 compliance objective. If you want customers’ trust, for example, your scope will be customer priorities. The next question you should ask is: what will make customers safe and comfortable with you? 

Here are some factors that customers might emphasize: 

  • High-grade data encryption 
  • Quality control
  • Excellent access control 
  • Process monitoring

However, some organizations forego the privacy principle if they comply with global standards like the EU’s GDPR

The integrity criterion is also largely applicable to financial firms and those that handle transactions. Most SaaS firms can fall under transactions so can be included in the compliance audits. But it must align with your goals. 

  1. Select the Applicable SOC 2 Report 

You can either choose the SOC I or SOC II reports. But, if it’s your first time conducting a SOC 2 audit, then you can only have a SOC I report. 

SOC 2 report is based on the previous evaluation. Hence it needs a prior compliance work report to work from. After putting up a running SOC 2 policy, create periodic reports to evaluate your performance against it. SOC 2 report contains all details in SOC 1 report and stakeholders value it more. 

So, go for SOC 2 report and document your performance across a certain period to demonstrate your established internal controls. 

  1. Prepare for Assessment and Run Continuous Monitoring 

With your objectives, scope, and the type of report in place, you can now prepare for the audit. For best compliance audit results consider the following: 

  • Evaluate any procedure and security control policies documents in current operation. 
  • Check out for gaps in these control policy documents. You can recheck how sensitive data is accessed and ways of tracking your policy effectiveness. 
  • Run continuous monitoring to identify areas of improvement. Come up with ways of improving them to meet SOC 2 compliance.

Recheck everything after addressing current policy gaps to confirm smooth operations as expected. 

Your auditor will check your scope. It will conduct internal interviews and review relevant SOC 2 documentation. You’ll be SOC 2 compliant upon approval by the auditor. 

Take Away

Being SOC 2 compliant has its perks. It gives you a competitive advantage and improves your brand trust and internal security controls. 

The increasing number of cybersecurity threats and attacks make cloud-native firms, especially SaaS and others vulnerable. It affects brand trust and may undermine your business if customers look elsewhere. Going for SOC 2 compliance is a badge of trustworthiness you need to assure your clients. 

We have listed the significant checklist to help you pass SOC 2 compliance audit. 


Team NGA


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