Service Organization Control (SOC) 2 compliance ensures organizations have proper procedures in place to safeguard private information and quickly mitigate cases when data leaks happen. Originally part of the American Institute of CPAs’ Service Organization Control reporting platform, SOC 2 compliance has become the seal of approval required by organizations to assure customers that their personal information is secure. To ensure your organization passes SOC 2 compliance, follow the guidance in this post and the detailed items in the downloadable checklist.
Download the SOC 2 compliance checklist:
7 steps to prepare for a SOC 2 audit
SOC 2 compliance requires organizations to adhere to the following five principles:
- Security. Processes and policies to secure information and systems from both internal and external threats.
- Availability. The reliability, monitoring, maintenance, and reasonable level of performance required to sustain stable operations.
- Process Integrity. Procedures to validate that private information isn’t manipulated or delayed either intentionally or by accident.
- Confidentiality. Controls to ensure private information is accessible only by authorized personnel.
- Privacy. Safeguards to protect personally identifiable information from unauthorized access.
When you define the scope, identify the processes in your organization that you must include in the SOC 2 report. Likewise, determine which processes you need to exclude from the report. For example, a service that’s used only to store information should adhere to the Security and Availability principles. If no data is manipulated, the Process integrity, Confidentiality, and Privacy principles may not apply.
After you define and understand the basic scope, it’s time to drill down into the finer details.
1. Identify and mitigate risks
SOC 2 is not a fixed set of rules. It’s a generalized strategy that’s unique to each business model. Therefore, your organization must map out the processes and procedures that it uses that might lead to, for example, financial and non-financial fraud, loss or modification of information, or unauthorized access.
SOC 2 requires your organization to have procedures in place to identify and mitigate issues that threaten any of the five SOC 2 principles that apply to your organization. A SOC 2 audit is a thorough and expensive 6–12-month long process. If you fail to identify the risks in your organization, you can receive a poor result on your SOC 2 audit. Therefore, you must clearly document every organizational process and procedure so you have mitigation plans ready in case of failure.
2. Develop a communication and training strategy
Often, the weakest link in an organization is an employee who doesn’t follow organizational security policies or can’t recognize a phishing attempt. To help prevent these situations, develop a communication and training strategy. As part of this strategy, also include the following objectives:
- Enforce a security policy
A major part of SOC 2 compliance is training employees to perform their tasks according to the security policies that were created specifically for your organizational structure. These organizational-wide and role-based mandates ensure employees understand their role in maintaining organizational security. For example, your security policies should ban the risky practice of password sharing, prevent access abuse for personal gain, and control which devices grant access to private information.
- Train to detect phishing
Phishing has become one of the most prevalent threats to organizations today. Phishing works by tricking employees through email, messaging, and even voice communication. It fools them into taking actions that compromise your organization by providing malicious actors with access.
Because phishing works through trickery, the only way to protect your organization against phishing is to provide effective cybersecurity awareness training. These training programs teach employees how to recognize suspicious requests and their accompanying pressure tactics. Do not limit cybersecurity awareness training to a one-off mandated lecture or documents for employees to read. Effective training requires repetition through contextual simulation bites that align with the employee’s daily workflow.
3. Define controls for high-risk areas
SOC 2 compliance is a generalized strategy that you must optimize for your unique organizational structure. However, high-risk areas apply everywhere that can negatively affect a SOC 2 audit. Be sure to address the following high-risk areas:
- Access controls and permissions
Employees join your organization, change roles, and eventually leave for whatever reason; that’s the circle of employment. As employee positions within your organization shift, review their access to systems and property as part of your organization’s standard security policy. If you fail to do so in a timely manner, you’ll fail your SOC 2 audit.
- Asset inventory management
Do you have a list of every computer on your network with a manifest of the software installed on each system? Do you have a security policy that covers employees who bring their own devices to work? If something fails, do you have a backup ready to take over? The SOC 2 audit’s goal is to assess risks to information. Therefore, you must know about every device that’s connected to your network and its maintenance schedule. You must also have a clear policy in place to deal with employees’ personal devices. If you don’t have a way to manage these items, your SOC 2 auditor will flag them.
- External communication
Your organization doesn’t exist in a bubble. It needs to communicate with the outside world, and that communication must remain secure. SOC 2 auditors require organizations to show how external communication is secured, down to the level of the transport protocol that you use to encrypt your data. Another aspect of external communication is how your organization monitors and handles unauthorized network usage. Failing to monitor and intercept unauthorized communication will also affect your SOC 2 audit.
- Separation of duties
SOC 2 mandates a separation of duties as an important security feature. Having a single person handle multiple duties without oversight can adversely impact information security within your company. For example, a single developer might push code full of bugs into production and negatively affect information security if no oversight or safety procedures are in place. You must be able to demonstrate your peer-review strategies and separation of duties. Without these protocols, you’ll face a poor outcome on your SOC 2 audit.
- Effective awareness training
Employees are the backbone of your organization. Help them stay cybersecurity aware to avoid being tricked into giving malicious actors access that compromises your organization. To receive a good SOC 2 audit, demonstrate how your organization uses awareness training by showing them real-time metrics that prove the effectiveness of regular employee training simulations.
4. Gain buy-in from stakeholders
To most people, an audit is considered a nuisance or chore. Upper management often doesn’t realize the commercial edge that’s obtained through SOC 2 compliance in future contract negotiations. SOC 2 compliance assures your clients that their private information is safe with you. However, this level of confidence is achievable only if upper management conveys SOC 2 compliance as an organizational goal that all employees must strive for. Therefore, gain buy-in from your stakeholders early in the SOC 2 preparation process.
5. Establish internal control monitoring
Within each organization, multiple controls and policies govern daily organization operations and mandate how an organization reacts to crises. Whether for employee turnover, infrastructure upgrades, or system configuration, you must consistently monitor controls that impact information security to ensure operational stability. Remember, SOC 2 audits take 6–12 months. Therefore, controls and procedures must remain stable throughout the duration of the audit. If enforcement becomes lax over time, you might not achieve the desired result of the audit.
6. Monitor third-party providers
Your organization may use third-party providers and services to meet operational requirements. Third-party providers that interact with private information can affect your SOC 2 audit.
Therefore, you must account for your third-party providers. Some providers, such as Amazon AWS, might have their own SOC 2 compliance accreditation that can simplify your audit. However, for providers that don’t have compliance accreditation, you must control and account for their internal processes. These controls provide assurances that any information passing through third-party systems remains secure and monitored at every point.
7. Conduct a pre-audit readiness and risk assessment
If you miss consideration of even a small section of your organization or its outsourced activity, your compliance audit can return unfavorable results, costing your organization time and money.
To strengthen your case for compliance, perform a pre-audit. Preferably, do the pre-audit with the same auditing agency that will perform the actual SOC 2 compliance audit later. The pre-audit helps you gain insight into the method, process, and depth that an auditor uses to assess your organization’s compliance. The information that you gain through a pre-audit readiness and risk assessment allows you to better scope your SOC 2 compliance requirements. It’s a powerful way to prevent unexpected surprises from popping up during an actual audit.
Download our step-by-step checklist
Whether you’re preparing for your first SOC 2 audit or are looking to correct mistakes from previous attempts at SOC 2 compliance, follow the advice in this post. To begin, scope the processes for your audit that are specific to your organization’s business model. Then, create a communication and employee training strategy to keep your employees from being exploited by malicious actors. Next, have backups and mitigation plans ready in case something goes wrong during the audit. Most importantly, download the detailed checklist to guide you step-by-step through the process. Remember: it’s always cheaper and faster to do things right the first time around.