Your guide to SOC 2 audits
A SOC 2 audit can often become a time of stress, indecision, and burnout for many companies. For some, the SOC 2 process may appear simple enough at the outset, but it soon turns into something much bigger. For others, it may seem like no level of preparation is enough.
But it doesn’t have to be that way. Whether you’re new to SOC 2 audits, or you’re searching for a better way, this guide will give you a comprehensive understanding of what to expect. In addition, you’ll learn how Vanta is helping 4,000+ businesses save time and money throughout the SOC 2 journey.
What is SOC 2 compliance?
SOC 2 is a compliance framework designed and maintained by the American Institute of CPAs (AICPA). SOC 2’s security guidelines are used as a standard to assess an organization’s security program and level of compliance.
To determine if your company is trustworthy, prospects, customers, and investors will want to see some kind of proof. That’s where SOC 2 comes in. Your SOC 2 report will serve as a testament to your company’s commitment to security and data privacy practices.
To obtain a SOC 2 report and prove that your organization is adhering to security guidelines, a third-party compliance expert conducts an audit. A SOC 2 audit is an unbiased evaluation of how well your business creates security protocols and implements them.
What is a SOC 2 audit and why is it important?
A SOC 2 audit is the process of assessing the way an organization upholds security and compliance through policies, practices, and controls. There are two main reasons why companies go through SOC 2 audits.
1) Undergoing a SOC 2 audit helps businesses develop a deeper understanding of how secure (or not secure) their organization actually is. Protecting sensitive data should rank high on the list of priorities for any business.
2) Organizations undergo SOC 2 audits in order to receive a SOC 2 report, which provides detailed information about internal security practices and protocols. Once obtained, this report can be shared with anyone who requests to see proof of security such as regulators, vendors, and especially prospective customers.
SOC 2 Trust Services Criteria
SOC 2 reports contain detailed information about your organization’s adherence to five standard categories known as the Trust Services Criteria.
- Security: All SOC 2 reports include the Security category. Your systems and the data you store are protected against unauthorized access and unauthorized disclosure.
- Availability: Your information and systems are available for operation and use.
- Confidentiality: Confidential information is protected.
- Processing integrity: System processing is complete, valid, accurate, timely, and authorized. Customer data remains correct throughout the course of data processing.
- Privacy: Personal information is collected, used, retained, disclosed, and disposed of in accordance with pre-stated policies. Although the Confidentiality category applies to any sensitive information, the Privacy category applies only to personal information.
The difficult part of the SOC 2 process is knowing which requirements are important to your organization. Businesses have a lot of jurisdiction when it comes to designing their compliance environment. All SOC 2 reports include the Security category; the other categories are optional. AICPA’s Trust Services Criteria includes 33 main requirements and 28 optional requirements.
Are SOC 2 audits legally required?
SOC 2 is not a mandatory regulation, but you may want to pursue a SOC 2 report if you intend to do business with large, US-based enterprise companies. Most prospects and vendors will accept a SOC 2 report within 12 months of the report being issued. There is no mandatory time frame, but most companies complete a SOC 2 audit on an annual or semi-annual basis.
Who performs SOC 2 audits?
A third-party certified auditor is required to conduct a SOC 2 audit and generate a verified report. Only CPA firms who are licensed can perform a proper SOC 2 audit. SOC 2 auditors are generally independent CPAs who are trained to evaluate the SOC 2 criteria and report on the policies and controls in place at your organization.
It is important that an auditor remains objective and unbiased to maintain the integrity and accuracy of the report. Cost, timing, and reputation are just a few factors that come into play when choosing the right auditor.
How long does a SOC 2 audit take?
SOC 2 audit timelines are difficult to estimate because each audit process is totally unique. Your auditor and the resources you commit to the project are the two main variables that determine an accurate time frame.
The other decisive factor is choosing between a SOC 2 Type I report and a SOC 2 Type II report. On average, Vanta customers can receive a SOC 2 Type I report in weeks, and a SOC 2 Type II report around seven months. These timeframes can be shorter for those who use an automated platform like Vanta.
SOC 2 Type I vs. SOC 2 Type II audits
SOC 2 Type I is a static point-in-time assessment of your business’s security and compliance posture. An auditor will investigate this snapshot to discover whether or not the right controls are in place. Type I reports are ideal for businesses that need a SOC 2 report as fast as possible.
SOC 2 Type II is a much more in-depth compliance review that takes place across six to 12 months. The auditor will evaluate the evidence collected over this period of time and determine the strength of controls and policies. Type II requires more time and resources, but offers a more meaningful and reliable attestation. Many prospects, especially in the enterprise, will specifically request a Type II report.
How much does a SOC 2 audit cost?
Before Vanta’s automated compliance platform, the fees for a SOC 2 audit could range between $10K to $70K annually. Similar to SOC 2 timelines, the average cost of a SOC 2 audit varies greatly depending on the size of the company, goals, and capabilities. Vanta offers many features in one package that would otherwise incur separate costs such as finding an auditor and risk assessments.
How Vanta streamlines the SOC 2 audit process
Our first-to-market compliance platform has helped thousands of companies tackle SOC 2 audits with confidence. Here are just a few ways Vanta accelerates the SOC 2 process compared to other options.
Find your ideal auditor with Vanta Seamless Audit
Even if you find an automated platform, you’ll still have to source an auditor on your own, but not with Vanta. We’ll save you hours of searching for the perfect auditor through Vanta Seamless Audit—our bundled package option that offers a premier platform matched with a five-star auditor.
Get ahead of audit issues with Vanta Risk Management
Risk assessments are another piece of the SOC 2 puzzle that can add extra costs to the bottom line. Risk assessments serve as an important preparatory step before your audit takes place. Vanta’s Risk Management solution is built into our platform, offering one hub and interface during your audit. It includes automated workflows and pre-built content to guide you along the way.
Automate your evidence collection and monitoring
Manual tasks and processes involved in the SOC 2 process have been replaced with compliance automation. Vanta’s platform seamlessly integrates with your tech stack to gather necessary evidence for your auditor. The platform also continuously monitors your organization, alerting you when something needs to be updated or fixed.
Put access reviews on autopilot
Access reviews monitor user access to systems and applications to ensure only the right people have access to your organization’s systems. These reviews are a necessary, recurring exercise as part of most standards and frameworks. They can also be painful and time consuming.
Vanta’s Access Review is a continuous automated solution that aligns to the required stages of standard frameworks. Using Vanta’s enhanced solution means faster, better, lower-cost access reviews that lead to streamlined audits, lower labor costs, stronger security posture, and accelerated revenue.
Determine whether the GDPR applies to you and if so, if you are a processor or controller (or both)
Do you sell goods or service in the EU or UK?
Do you sell goods or services to EU businesses, consumers, or both?
Do you have employees in the EU or UK?
Do persons from the EU or UK visit your website?
Do you monitor the behavior of persons within the EU?
Create a Data Map by taking the following actions
Identify and document every system (i.e. database, application, or vendor) which stores or processes EU or UK based personally identifiable information (PII)
Document the retention periods for PII in each system
Determine whether you collect, store, or process “special categories” of data
Determine whether your Data Map meets the requirements for Records of Processing Activities (Art. 30)
Determine whether your Data Map includes the following information about processing activities carried out by vendors on your behalf
Determine your grounds for processing data
For each category of data and system/application have you determined the lawful basis for processing based on one of the following conditions?
Take inventory of current customer and vendor contracts to confirm new GDPR-required flow-down provisions are included
Review all customer contracts to determine that they have appropriate contract language (i.e. Data Protection Addendums with Standard Contractual Clauses)
Review all in-scope vendor contracts to determine that they have appropriate contract language (i.e. Data Protection Addendums with Standard Contractual Clauses)
Have you performed a risk assessment on vendors who are processing your PII?
Determine if you need to do a Data Protection Impact Assessment
Is your data processing taking into account the nature, scope, context, and purposes of the processing, likely to result in a high risk to the rights and freedoms of natural persons?
Review product and service design (including your website or app) to ensure privacy notice links, marketing consents, and other requirements are integrated
Does the notice to the data subject include the following items?
Does the notice also include the following items?
Do you have a mechanism for persons to change or withdraw consent?
Update internal privacy policies to comply with notification obligations
Update internal privacy notices for EU employees
Determine if you need to appoint a Data Protection Officer, and appoint one if needed
Have you determined whether or not you must designate a Data Protection Officer (DPO) based on one of the following conditions (Art. 37)?
If you export data from the EU, consider if you need a compliance mechanism to cover the data transfer, such as model clauses
If you transfer, store, or process data outside the EU or UK, have you identified your legal basis for the data transfer (note: most likely covered by the Standard Contractual Clauses)
Have you performed and documented a Transfer Impact Assessment (TIA)?
Confirm you are complying with other data subject rights (i.e. aside from notification)
Do you have a defined process for timely response to Data Subject Access Requests (DSAR) (i.e. requests for information, modification or deletion of PII)?
Are you able to provide the subject information in a concise, transparent, intelligible and easily accessible form, using clear and plain language?
Do you have a process for correcting or deleting data when requested?
Do you have an internal policy regarding a Compelled Disclosure from Law Enforcement?
Determine if you need to appoint an EU-based representative, and appoint one if needed
Have you appointed an EU Representative or determined that an EU Representative is not needed based on one of the following conditions?
If operating in more than one EU state, identify a lead Data Protection Authority (DPA)
Do you operate in more than one EU state?
If so, have you designated the Supervisory Authority of the main establishment to act as your Lead Supervisory Authority?
Implement Employee Trainings to Demonstrate Compliance with GDPR Principles and Data Subject Rights
Have you provided appropriate Security Awareness and Privacy training to your staff?
Update internal procedures and policies to ensure you can comply with data breach response requirements
Have you created and implemented an Incident Response Plan which included procedures for reporting a breach to EU and UK Data Subjects as well as appropriate Data Authorities?
Do breach reporting policies comply with all prescribed timelines and include all recipients i.e. authorities, controllers, and data subjects?
Implement appropriate technical and organizational measures to ensure a level of security appropriate to the risk
Have you implemented encryption of PII at rest and in transit?
Have you implemented pseudonymization?
Have you implemented appropriate physical security controls?
Have you implemented information security policies and procedures?
Can you access EU or UK PII data in the clear?
Do your technical and organizational measure ensure that, by default, only personal data which are necessary for each specific purpose of the processing are processed?
Consider streamlining GDPR compliance with automation
Transform manual data collection and observation processes into continuous monitoring
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Develop a roadmap for successful implementation of an ISMS and ISO 27001 certification
Implement Plan, Do, Check, Act (PDCA) process to recognize challenges and identify gaps for remediation
Consider ISO 27001 certification costs relative to org size and number of employees
Clearly define scope of work to plan certification time to completion
Select an ISO 27001 auditor
Set the scope of your organization’s ISMS
Decide which business areas are covered by the ISMS and which are out of scope
Consider additional security controls for business processes that are required to pass ISMS-protected information across the trust boundary
Inform stakeholders regarding scope of the ISMS
Establish an ISMS governing body
Build a governance team with management oversight
Incorporate key members of top management, e.g. senior leadership and executive management with responsibility for strategy and resource allocation
Conduct an inventory of information assets
Consider all assets where information is stored, processed, and accessible
- Record information assets: data and people
- Record physical assets: laptops, servers, and physical building locations
- Record intangible assets: intellectual property, brand, and reputation
Assign to each asset a classification and owner responsible for ensuring the asset is appropriately inventoried, classified, protected, and handled
Execute a risk assessment
Establish and document a risk-management framework to ensure consistency
Identify scenarios in which information, systems, or services could be compromised
Determine likelihood or frequency with which these scenarios could occur
Evaluate potential impact of each scenario on confidentiality, integrity, or availability of information, systems, and services
Rank risk scenarios based on overall risk to the organization’s objectives
Develop a risk register
Record and manage your organization’s risks
Summarize each identified risk
Indicate the impact and likelihood of each risk
Document a risk treatment plan
Design a response for each risk (Risk Treatment)
Assign an accountable owner to each identified risk
Assign risk mitigation activity owners
Establish target dates for completion of risk treatment activities
Complete the Statement of Applicability worksheet
Review 114 controls of Annex A of ISO 27001 standard
Select controls to address identified risks
Complete the Statement of Applicability listing all Annex A controls, justifying inclusion or exclusion of each control in the ISMS implementation
Continuously assess and manage risk
Build a framework for establishing, implementing, maintaining, and continually improving the ISMS
Include information or references to supporting documentation regarding:
- Information Security Objectives
- Leadership and Commitment
- Roles, Responsibilities, and Authorities
- Approach to Assessing and Treating Risk
- Control of Documented Information
- Internal Audit
- Management Review
- Corrective Action and Continual Improvement
- Policy Violations
Assemble required documents and records
Review ISO 27001 Required Documents and Records list
Customize policy templates with organization-specific policies, process, and language
Establish employee training and awareness programs
Conduct regular trainings to ensure awareness of new policies and procedures
Define expectations for personnel regarding their role in ISMS maintenance
Train personnel on common threats facing your organization and how to respond
Establish disciplinary or sanctions policies or processes for personnel found out of compliance with information security requirements
Perform an internal audit
Allocate internal resources with necessary competencies who are independent of ISMS development and maintenance, or engage an independent third party
Verify conformance with requirements from Annex A deemed applicable in your ISMS's Statement of Applicability
Share internal audit results, including nonconformities, with the ISMS governing body and senior management
Address identified issues before proceeding with the external audit
Undergo external audit of ISMS to obtain ISO 27001 certification
Engage an independent ISO 27001 auditor
Conduct Stage 1 Audit consisting of an extensive documentation review; obtain feedback regarding readiness to move to Stage 2 Audit
Conduct Stage 2 Audit consisting of tests performed on the ISMS to ensure proper design, implementation, and ongoing functionality; evaluate fairness, suitability, and effective implementation and operation of controls
Address any nonconformities
Ensure that all requirements of the ISO 27001 standard are being addressed
Ensure org is following processes that it has specified and documented
Ensure org is upholding contractual requirements with third parties
Address specific nonconformities identified by the ISO 27001 auditor
Receive auditor’s formal validation following resolution of nonconformities
Conduct regular management reviews
Plan reviews at least once per year; consider a quarterly review cycle
Ensure the ISMS and its objectives continue to remain appropriate and effective
Ensure that senior management remains informed
Ensure adjustments to address risks or deficiencies can be promptly implemented
Calendar ISO 27001 audit schedule and surveillance audit schedules
Perform a full ISO 27001 audit once every three years
Prepare to perform surveillance audits in the second and third years of the Certification Cycle
Consider streamlining ISO 27001 certification with automation
Transform manual data collection and observation processes into automated and continuous system monitoring
Identify and close any gaps in ISMS implementation in a timely manner
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Determine which annual audits and assessments are required for your company
Perform a readiness assessment and evaluate your security against HIPAA requirements
Review the U.S. Dept of Health and Human Services Office for Civil Rights Audit Protocol
Conduct required HIPAA compliance audits and assessments
Perform and document ongoing technical and non-technical evaluations, internally or in partnership with a third-party security and compliance team like Vanta
Document your plans and put them into action
Document every step of building, implementing, and assessing your compliance program
Vanta’s automated compliance reporting can streamline planning and documentation
Appoint a security and compliance point person in your company
Designate an employee as your HIPAA Compliance Officer
Schedule annual HIPAA training for all employees
Distribute HIPAA policies and procedures and ensure staff read and attest to their review
Document employee trainings and other compliance activities
Thoroughly document employee training processes, activities, and attestations
Establish and communicate clear breach report processes
to all employees
Ensure that staff understand what constitutes a HIPAA breach, and how to report a breach
Implement systems to track security incidents, and to document and report all breaches
Institute an annual review process
Annually assess compliance activities against theHIPAA Rules and updates to HIPAA
Continuously assess and manage risk
Build a year-round risk management program and integrate continuous monitoring
Understand the ins and outs of HIPAA compliance— and the costs of noncompliance
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