If your clients or prospects have requested a SOC 2 report, obtaining a SOC 2 report typically follows a three step process.
Step 1: Readiness Assessment
A readiness assessment helps your organization prepare for a SOC 2 audit. Used for internal purposes, this assessment provides your organization with a roadmap to prepare for a SOC 2 audit by identifying your current controls as mapped to SOC 2 requirements, identify any control gaps, and make recommendations to close gaps based on your specific business.
Step 2: SOC 2 Type I Report
After a readiness assessment most organizations pursue a SOC 2 Type I report. With a Type 1 report, your organization’s controls are assessed at a specific point in time. The advantage of pursuing a SOC 2 Type I report is that your organization can obtain a SOC 2 report immediately (point in time) rather than over an audit period (as with a SOC 2 Type II Report). A Type I report acts as a snapshot of your environment to determine and demonstrate if the controls are suitably designed and in place.
A SOC 2 Type I audit is also an opportunity to validate that gaps identified during the readiness assessment were remediated and meet SOC 2 audit standards. For example, if during the readiness assessment we found system changes were not documented, during the SOC 2 Type I we will select a recent system change to determine if it followed the defined and documented change management process.
If this is a first year report we recommend organizations start their compliance journey with a Type 1 report, and later move on to a Type 2 in the following audit period. Clients will typically accept a SOC 2 Type I report during the first year with the understanding that you will obtain a SOC 2 Type II report thereafter.
Step 3: SOC 2 Type II Report
For a SOC 2 Type II report, your organization’s controls are assessed over a period of time, typically a twelve-month review period. A SOC 2 Type II Report acts as a historical review of your system to determine and demonstrate if the controls are suitably designed and in place, as well as operating effectively over time.
During a SOC 2 Type II report, audit procedures are adjusted to review information throughout the audit period (rather than a point in time as in the Type I). For example, take the change management example above. Rather than choosing a single change we will review the total population of changes made during the audit period and select a sample of changes to determine if each change followed the defined and documented change management process.
Since a Type 2 report is more comprehensive than a Type 1 report, it often provides your clients with a higher level of assurance and has become the standard expectation from clients and prospects. A SOC 2 Type II report is obtained annually thereafter.