Vanta’s Guide to SOC Reporting
If you’ve done research on SOC reports, you’ve probably seen that there are three types of SOC reports:
- SOC 1
- SOC 2
- SOC 3
A SOC 1 evaluates an organization’s financial controls – the practices and procedures in place to ensure financial information is accurate. These reports are issued after an audit and can only be shared with a non-disclosure agreement.
Companies will often send these reports to their prospects and customers to demonstrate their commitment to financial accuracy.
It is most useful for companies that process financial transactions:
- Payroll processors
- Medical claims processors
- Loan servicing companies
- Software as a Service (SaaS) companies that process or store financial data about their users’ businesses
A SOC 2 evaluates an organization’s technical oversight and policies. These reports are issued after an audit and can only be shared with a non-disclosure agreement.
Companies will often send these reports to their prospects and customers to demonstrate their commitment to data security and privacy.
It is most useful for technology companies that store data from their users:
- Software as a Service (SaaS) service providers
- Platform as a Service (PaaS) service providers
You can learn more about SOC 2 at Vanta's SOC 2 Guide.
A SOC 3 verifies the service organization underwent a SOC 1, SOC 2, or both. It’s a high-level overview of the audit and can be published without restriction. Earlier-stage companies tend to forgo SOC 3 reports and instead share their SOC 1 or SOC 2 under NDA.
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How Vanta helps companies achieve and maintain SOC compliance
Vanta simplifies the SOC burden for companies by:
- Creating controls custom to your company that conform to AICPA guidance
- Verifying your company’s infrastructure, data, organizational, and physical security with integrations into your tools
- Providing tools and guidance to fix weak points
- Working with auditors to guide companies through SOC 1 and SOC 2 audits
SOC audits that assess and validate compliance usually happen annually, but SOC compliance is not a one-time event – it’s a continuous and substantial effort to assess, remediate, and maintain security. A company’s security and compliance requirements evolve as the business does, which means that audits differ from year to year for the same company; there is no “set it and forget it” in the security and compliance space. Further, relying on the auditors to spot problems leaves customer data less secure and your business vulnerable to a questionable (“qualified”) SOC report.
Instead, continuous security monitoring and alerting, tied to your company’s compliance controls, is an effective and efficient way to protect data and maintain compliance. It leaves the tedious work of monitoring controls to software and frees up your team to respond to deviations – every single day of the year.