SOC Compliance Readiness Check

1. Introduction to SOC Compliance

SOC 1 is a type of SOC report that focuses on an organization’s financial reporting controls. SOC 2 and SOC 3 reports focus on a company’s non-financial reporting controls and are designed to help service providers build trust and confidence in their service delivery processes and controls. SOC 2 analyzes a company’s internal controls as they relate to Security, Availability, Processing Integrity, and Confidentiality. The principles companies regulate with the SOC 2 controls report are at their own determination. The SOC 2 audit is designed for service providers storing customer data in the cloud but can be adapted for any company. A SOC 3 is an Executive Summary report that can be freely distributed and shows the company has a clean bill of health. It includes the SOC 2 report but removes sensitive company information and anything considered "client insights" not to be made public.

Service organizations are under constant attack for data breaches. SOC assurances and security and privacy compliance are vital to protect consumers’ personal and sensitive information. All businesses must take a proactive approach to earn trust through compliance. Data breaches have seen a dramatic increase, with significant financial losses reported. With advances in governance, policy, and compliance, executives and organizations are held accountable to adopt new federal and business best practices for IT general controls. Compliance strategies are often aligned with organizational business strategies to gain a competitive edge and tap into new markets in major and foreign countries. SOC compliance has made its way into almost every industry mainstream. So for an organization that engages in third-party attestations for IT general controls, it heavily relies on SOC 1 compliance standards.

2. Key Components of SOC Compliance

While compliance involves a range of efforts to be conducted within your organization, based on your control framework, the goal is to establish controls and document practice data conforming to specific criteria. The foundation of these efforts includes governance, risk management, and internal control systems that align operations per a predefined model. There are key components in helping to foster a culture of compliance at your organization.

The Trust Services Criteria refer to key areas that data processing policy must address. They include:

1. Security
2. Availability
3. Processing Integrity
4. Confidentiality
5. Privacy.

These are the things that your clients ask themselves about daily as they contract with you to process their data. It is the role of someone designing a control framework (or the reviewer of a control framework) to assess what normal operations look like using these areas of interest. Once a control framework is decided upon, controls are built and the use of those controls documented to demonstrate alignment per the given framework. Technology may or may not be a formal part of your compliance solution. The majority of case work for client companies in pursuing compliance does integrate tools into the solution. Tools can serve to automate control procedures, document user evidence, enforce control requirements, send alerts, and help manage the program overall. When this integration is in place, policies and control practice become part of user operations, and continual verification through evidence becomes a way of life. Maintenance rebates is an example of software engineering with embedded compliance. Their technology directly turns the key in four of the five Trust Service Criteria. Keep in mind, technology alone does not make you compliant. Compliance comes from you as the service provider following your own established organized control framework. Technology comes in to make this process automatic to reduce overhead costs and overhead mistakes for policy consumption and practice reporting.

3. Conducting a Readiness Check for SOC Compliance

Before an official SOC audit commences, it is usually a good idea to check if you're on the right path; this means determining if your existing policies, procedures, and controls would qualify for a SOC examination. Conducting a readiness check could help you determine beforehand what kinds of weaknesses your organization has and must work on for successful compliance. The first thing to do is to confine the scope of the SOC readiness check to the "to-be-audited" entities. Engage the services of an external auditor who is an expert in SOC compliance to assist with the readiness check. The readiness check should cover the following:

Interviews with selected staff who work in areas that will be reviewed as part of the SOC compliance process. This could be the IT department, HR, finance, internal audit, etc. Review of existing policies, procedures, and IT technical setups. Use tools and methods that auditors would use to carry out their checks. The findings and identified weaknesses should be presented in a report with detailed management recommendations on how to close the gaps and resolve the weaknesses in your IT infrastructure, procedures, or setup. This report, if comprehensive, should be turned into a detailed action plan. It should serve as a blueprint or a project initiation document that describes the required steps from where you are to being compliant with all the relevant SOC criteria requirements. A SOC readiness check exposes your organization to the SOC auditor way before the independent auditor speaks to you. Furthermore, it helps to reinforce your compliance and security culture as it gets everyone talking about your compliance. However, if the interviews and discussions uncover any red-flag non-compliance issues, management usually initiates quick remedial actions.

4. Best Practices for Achieving SOC Compliance Readiness

Best Practices for Achieving SOC 2 Compliance Readiness

Building SOC compliance readiness can be complex and challenging. Here are 10 best practices that will help you as you navigate your way through the compliance certification process.

1. Gain Leadership Support. Your organization is more likely to achieve and maintain compliance with support from top leadership.

2. Keep Your Team Informed. Everyone must know what the aim is. Invest in preparing and retraining policies and processes.

3. Formalize Policies and Processes. Record the organization’s plans, conventional rules, and criteria to support you in the execution of your compliance priorities.

4. Invest in Technology for Monitoring and Reporting. Read and talk to other businesses about technology for processing and tracking privacy information and complying with policy documents.

5. Stay Informed. As security and privacy laws are updated, it is important to regularly review these processes and prepare for improvements in IT protection and confidentiality policies.

6. Hire an Independent Consultant or Auditor. Whether your consultant conducts daily reviews of the IT system or acts as an external advisor, they may provide you with extra advice and support to stand firm against an unfavorable examination.

7. Check Your Security Regularly. It is important to ensure that the relevant information has been obtained and audited on a consistent and continuous basis.

8. Customize the IT Policy. Keep in mind that the business environment and technology protection alignment are likely to change. Providers may alter the compliance specifications to coordinate with you.

9. Stay in Contact with the Experts. Do not attempt to balance a set of compliance requirements alone. Get out and speak to those who are more familiar with your compliance process.

10. A Non-Specific Compliance to the Service Commission Process. Reputation protection and a competitive advantage would benefit enterprises. Application for an external SOC certification indicates the pursuit of an efficient and secure IT security environment. While current clients are typically requested to undergo some certification or security examination, a robust and securely maintained protection infrastructure may attract them to seek you even with a newer consumer.