What is SOC Compliance, and How to Achieve It
Service Organizational Control (SOC) compliance is a set of standards and controls that helps organizations manage and protect customer data.
- All businesses that store sensitive customer information must meet SOC compliance standards.
- There are different levels of SOC compliance, so you’ll need to decide which one is right for your business.
- SOC 2 compliance does not require organizations to follow any specific rules, but instead, organizations can have an audit performed.
SOC compliance is essential for businesses to protect themselves and their customers from data breaches and cyberattacks. Organizations can do a few key things to meet SOC compliance and ensure that any stored information remains safe and secure.
What is SOC Compliance?
Service Organizational Control, or SOC, compliance is a set of standards and controls by the American Institute of Certified Public Accountants (AICPA). SOC compliance helps organizations manage and protect customer data. All businesses that store sensitive customer information must meet SOC compliance standards.
SOC compliance has become increasingly important as data breaches have become more common. A data breach can cause severe financial and reputational damage to a business, so it's essential to take steps to prevent them. Companies can protect themselves and their customers from data breaches and cyberattacks by remaining SOC compliant.
Does My Business Need SOC Compliance?
Your business must be SOC compliant if it stores sensitive data. Sensitive data includes credit card numbers, social security numbers, bank account information, and valuable organizational information. If you aren't sure if your business stores this type of information, err on the side of caution and assume that you do.
There are different levels of SOC compliance, so you’ll need to decide which one is right for your business.
Difference Between SOC Types
There are three types of SOC reports: SOC 1, SOC 2, and SOC 3. Each class focuses on a different area of the service. In addition, SOC 1 and SOC 2 also break into Type I and Type II reports. The type of report your organization needs depends on the services you're looking to have covered.
SOC 1 is a report that focuses on the financial statement audit of a service organization and covers the system's controls relevant to financial reporting. SOC 1 ensures internal control over financial reporting.
Type I: SOC 1, Type I reports focus on a system's effectiveness at a specified point in time.
Type II: SOC 1, Type II reports include everything from Type I reports but also have information on a system's effectiveness over a period of time.
SOC 2 focuses on the non-financial statement audit of a service organization and covers the system's security, confidentiality, and privacy controls. Organizations that handle sensitive information through the cloud benefit the most from SOC 2 compliance.
SOC 2 compliance is the most important type for most organizations because it focuses on security, confidentiality, and privacy. These are all essential aspects of data security businesses need to protect themselves from cyberattacks and data breaches. Meeting SOC 2 compliance standards is critical for companies that store sensitive customer information.
Type I: As with SOC 1 Type I reports, SOC 2 Type I reports cover an organization's compliance at a specific point in time.
Type II: SOC 2 Type II reports include everything from a Type I report but also evaluate an organization's capabilities of sustaining security and compliance.
SOC 3 focuses on the organization's ability to protect its customers' information. SOC 3 compliance is less rigorous than SOC 2 compliance, so organizations that take data security seriously opt for SOC 2.
Unlike SOC 1 and SOC 2, SOC 3 does not have Type I and Type II reports.
5 SOC Compliance Points of Focus
SOC 2 compliance does not require organizations to follow any specific rules. Instead, the AICPA performs an audit to determine the security of organizations. To meet SOC 2 requirements, organizations should meet the following standards:
Security: The system should have controls to protect against unauthorized access, use, or disclosure of information.
Privacy: The system should have controls in place to protect the privacy of individuals' information.
Confidentiality: The system should have controls to prevent disclosing information to unauthorized individuals.
Availability: The system should be available for use when needed.
Processing Integrity: The system should have controls to ensure that information is processed accurately and completely.
The Bottom Line
SOC compliance is important for organizations because it helps protect their customers' data. It is important for all organizations to determine if they store data that must meet SOC compliance.
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