People familiar with various compliance measures have probably at least heard passing mentions of System and Organization Controls 2, more commonly referred to as SOC 2. Its a type of voluntary compliance developed by the American Institute of Certified Public Accountants.
SOC 2 covers various aspects of sensitive data handling. For example, an SOC 2 data center would show that it follows strict security procedures when working with confidential customer information.
An organization must follow specific steps to become SOC 2 compliant. Here’s a breakdown of what’s involved.
1. Become Familiar With the Criteria
A major part of becoming SOC 2 compliant is passing an audit. The auditor examines a company according to its performance in 1-5 areas collectively known as the Trust Services Criteria (TSC). All companies attempting SOC compliance get scored in the Security category. It encompasses the extent to which a company’s data and storage systems safeguard against unauthorized access and disclosures.
Whether a company’s audit includes the other four areas depends on its business scope. Those areas are availability, confidentiality, processing integrity and privacy.
Availability: How consistently people can use a company’s systems and data
Confidentiality: How well the company safeguards all sensitive information
The final two categories have several criteria a company must meet.
Processing Integrity: Systems processing occurs completely and accurately and in a timely, authorized and valid manner. Moreover, customer data remains correct throughout all systems processes.
Privacy: Personal data gets gathered, utilized, kept, disclosed and discarded in ways that align with pre-specified policies.
Understanding the scope of an SOC 2 audit helps company representatives explore how a business is doing well and where room for improvement exists. Before moving ahead with SOC 2 efforts, people should verify whether the four categories other than Security meet
2. Create a Team and Craft Associated Policies
The next step is to build a team of people committed to helping a company achieve SOC 2 compliance. The auditor is the only team member originating from outside an organization. All the rest of the people come from within, but ideally from various departments.
Forming a Highly Functional Team
Someone aiming to have an SOC 2 data center might initially want to form a team solely comprised of front-line personnel, such as technicians and operators. However, that’s a short-sighted goal. Other workers, including those in the customer service and human resources departments, handle data daily, too. Keeping data safe, for compliance reasons or otherwise, is a company-wide effort, and it’s best if people from as many departments as possible get involved.
The auditor must be from a certified public accounting (CPA) firm. However, people should take the time to choose someone who fits that description and understands the company’s line of business.
They must also realize the extent of the auditor’s duties and obligations. For example, they can give input on the effectiveness of a given control implemented to achieve a compliance ideal. However, they cannot offer recommendations for the control’s design.
Writing Policies That Make Sense for Business and Compliance-Related Aims
After building the team, it’s time to make the policies that will help the company reach compliance. Consider the example of an SOC 2 data center candidate that currently has an excessive downtime issue. Statistics show it can cost more than $7,900 per minute when a data center has an outage.
Beyond the financial costs, that problem interferes with the availability prong of the SOC 2 criteria. A potential policy change might involve the batteries for the facility’s backup power, ensuring they’re always ready to kick in when needed.
SOC 2 policies could also relate to things companies do to stay safeguarded from worst-case scenarios. Ransomware is a good example of something that throws businesses into data-loss chaos that can push decision-makers to desperation. A global 2020 study found that in 56% of cases, ransomware victims caved to demands, hoping doing so would get their data back. However, doing that only resulted in full restoration 29% of the time.
The policies people write during the preparations for SOC 2 compliance should ideally fit with both the criteria and the company’s overarching goals. That way, it will be easier to justify putting the effort into following them.
3. Set a Realistic Timeline
Many organizational representatives will understandably want some guidance about how long it could take to become SOC 2 compliant. The challenging reality is that the timeframe will vary based on numerous things. Those could include how many of the criteria apply to the business, how many people are on the team working to achieve compliance and the company’s readiness before setting SOC 2 compliance as a goal.
If the aim is to have an SOC 2 data center, the facility may already have numerous protocols in place that support responsible information usage and protection. However, if a company’s leaders have never closely examined their procedures that keep data safe, compliance could be a more challenging aspiration.
All things considered, it could take anywhere from weeks to months to become SOC 2 compliant. It’s important that everyone at the organization realizes that this may not be something that happens quickly. Even so, that’s not a reason to become discouraged.
People should also try to adopt long-range viewpoints about what the SOC 2 compliance would mean for the organization. In the case of an SOC 2 data center, it would inspire trust and confidence in customers that the facility is well-protected against breaches. Many companies also mention SOC 2 compliance on their websites after passing the audit.
4. Prepare the Management’s Assertion for the Audit Report
A component called Management’s Written Assertion is a valuable part of the audit process. It tells the auditor about the design of the company’s systems and controls to protect data. The auditor can then refer to it when making their assessments.
The assertion contains a specified time in which the controls were implemented. It also mentions that the controls worked as intended throughout that span.
Finally, the assertion details what criteria were used to verify that the controls functioned as expected. It should also confirm that the business consistently applied the controls during the period in question.
5. Read the Auditor’s Report
Once the auditor finishes assessing an organization, they will provide a written report of their findings and associated opinions. Those will include:
- Whether the descriptions in the Management’s Written Assertion match what the auditor noticed in the examination
- Whether the controls mentioned by the management designed and operated sufficiently to meet the Trust Services Criteria
The auditor’s report will also contain a written breakdown of their findings, including whether the organization passed and is now compliant. If it did not, the auditor’s report will include details that should help the organization make improvements before reattempting the compliance process.
A Methodical and Worthwhile Process
This overview of how a company becomes SOC 2 compliant highlights how there are specific steps it must go through to increase the chances of success. It takes time and effort to complete them, but the results could mean that organization has achieved a compliance seen as increasingly valuable in today’s data-driven society.
