SOC 1 and SOC 2 Audits
As a service provider, your clients need to know that your processes and security controls meet their standards in order to conduct business with you, which is both a competitive advantage to your service organization, and an assurance to your clients.
And as a company, you should know the strengths and weaknesses of your service providers to assure their systems and processes do not present risk to your financial reporting or data security.
SOC Audit Definition
Many service companies have the potential to impact their customers’ financial information and data integrity across their business functions. Auditors of company financials and data security protocols require assurance that the controls and processes of those service providers are in full compliance so that the integrity of company financials and their data are intact.
System Organization Control Audits, or SOC Audits, are an analysis and report given on a service organization’s controls of said financial information and data integrity. These audits provide assurance to auditors that the processes service organizations are utilizing will not have a negative impact on financial reporting or data integrity.
Companies that should have a SOC Audit
Any service organization that houses or services confidential and private financial data should consider performing a SOC audit of their organization.
- SaaS companies
- Payment processors
- Service providers to insurance brokers and banks
- Data outsourcers
Additionally, those serving high-risk industries, including:
- Financial services
- Professional services