What is a SOC report
A SOC report is a service organization control report. It is an independent assessment of the controls that a service organization has in place to protect its clients’ data. The report typically includes a description of the controls, how they are implemented, and whether or not they are effective.
A SOC 1 report is used by organizations that provide services to other businesses and need to demonstrate their internal controls over financial reporting. A SOC 2 report is used by organizations that provide services that involve the handling of confidential data, such as cloud providers.
SOC reports are usually prepared by a certified public accountant (CPA) firm that has been engaged by the service organization. The CPA firm will conduct an assessment of the controls in place and issue a report that includes its findings and conclusions.
SOC report types
There are two types of SOC reports: SOC 1 and SOC 2.
A SOC 1 report is used by organizations that provide services to other businesses and need to demonstrate their internal controls over financial reporting. A SOC 2 report is used by organizations that provide services that involve the handling of confidential data, such as cloud providers. What is a SOC Report ? – Learn more from TrustNet.
A SOC 2 Type 1 report is an evaluation of the controls at a service organization. It assesses whether the controls are designed and implemented properly. A SOC 2 Type 1 report does not provide any assurance that the controls are effective. A SOC 2 Type 2 report is an evaluation of the controls at a service organization. It assesses whether the controls are designed and implemented properly, and whether or not they are effective.
SOC reports are usually prepared by a certified public accountant (CPA) firm that has been engaged by the service organization. The CPA firm will conduct an assessment of the controls in place and issue a report that includes its findings and conclusions.
Organizations that are considering engaging a service organization should request a copy of the SOC report before entering into any agreement. This will allow them to see how the service organization controls its own environment and whether or not it is adequately protecting their data.