SOC2 compliance: A checklist

SOC 2 (Service Organization Control 2) is an auditing standard developed by the American Institute of CPAs (AICPA) that evaluates how well service organizations manage and protect customer data. It focuses on five key trust service criteria: security, availability, processing integrity, confidentiality, and privacy. The framework is specifically designed for technology and cloud computing companies that store, process, or transmit customer information.

There are two types of SOC 2 reports: Type I and Type II. Type I reports assess whether a company's controls are properly designed and implemented at a specific point in time. Type II reports are more comprehensive, examining the operational effectiveness of these controls over a period of time, typically six to twelve months.

SOC 2 compliance demonstrates to customers, partners, and stakeholders that an organization takes data security seriously and has implemented appropriate safeguards. While not legally required, SOC 2 certification has become increasingly important for businesses seeking to build trust and meet the security requirements of enterprise clients. The audit process involves working with an independent CPA firm to assess controls, identify gaps, and ultimately receive a report that can be shared with interested parties under non-disclosure agreements.

SOC2 compliance steps

Understanding and implementing SOC 2 compliance

The first step involves understanding the scope and requirements of SOC 2 compliance. Organizations must determine which of the five Trust Services Criteria apply to their business operations: Security (which is mandatory), Availability, Processing Integrity, Confidentiality, and Privacy. Unlike rigid frameworks, SOC 2 allows companies to design their own controls tailored to their specific business practices and risk profile. This initial phase requires conducting a thorough gap analysis to identify current security posture versus SOC 2 requirements, defining the audit scope, and establishing a project timeline with clear milestones.

The second step focuses on implementing comprehensive controls and documentation. Organizations must develop and deploy security policies, procedures, and technical controls that address their selected Trust Services Criteria. This includes establishing access management systems, incident response procedures, vendor management protocols, and risk assessment processes. All policies must be formally documented, communicated to relevant personnel, and integrated into daily operations. Evidence collection systems should be implemented to continuously gather proof of control effectiveness throughout the review period.

The third step involves preparing for and undergoing the formal audit process. Organizations must select a qualified CPA firm to conduct the SOC 2 audit and decide between Type I (point-in-time assessment) or Type II (operational effectiveness over 3-12 months). During this phase, companies work closely with auditors to provide evidence, demonstrate control implementation, and address any identified deficiencies. The audit process includes interviews with key personnel, testing of controls, and review of supporting documentation to verify compliance with the selected Trust Services Criteria.

The final step encompasses maintaining ongoing compliance and continuous improvement. After receiving the SOC 2 report, organizations must address any exceptions or recommendations from auditors and implement corrective actions. Continuous monitoring systems should be established to ensure controls remain effective year-round, not just during audit periods. Regular internal assessments, employee training updates, and control testing help maintain compliance readiness for subsequent audits and demonstrate ongoing commitment to data security and customer trust.

SOC 2 compliance checklist

• Establish comprehensive access controls and user provisioning processes - Example: Implement multi-factor authentication for all administrative accounts and maintain documented user access reviews every 90 days, ensuring employees only retain access to systems necessary for their current role
• Deploy continuous security monitoring and incident response capabilities - Example: Configure automated alerts for failed login attempts exceeding five tries within 15 minutes and maintain a formal incident response plan with defined escalation procedures and communication templates
• Implement formal change management and system configuration controls - Example: Require documented approval from IT security team before deploying any code changes to production environments, with all changes tracked in a centralized system and tested in staging environments first
• Establish vendor risk management and third-party access procedures - Example: Conduct annual security assessments of all vendors handling customer data, requiring SOC 2 reports or equivalent certifications before contract approval and ongoing monitoring of vendor security posture
• Maintain comprehensive policy documentation and employee training programs - Example: Publish an information security policy handbook accessible to all employees, conduct mandatory annual security awareness training, and require signed acknowledgment of policy updates within 30 days
• Deploy data protection and encryption controls for data at rest and in transit - Example: Encrypt all customer databases using AES-256 encryption and implement TLS 1.3 for all data transmissions, with encryption key management following industry best practices and regular rotation schedules
• Establish business continuity and disaster recovery capabilities - Example: Maintain automated daily backups of critical systems stored in geographically separate locations, with documented recovery procedures tested quarterly and maximum 4-hour recovery time objectives for production systems

Common challenges

Organizations frequently struggle with the complexity and subjectivity inherent in SOC 2 compliance, as the framework lacks rigid requirements and instead allows each company to design its own controls to meet the Trust Services Criteria. This flexibility, while beneficial for tailoring security measures to specific business needs, creates uncertainty about whether implemented controls will satisfy auditor expectations and adequately address the five trust principles. The burden falls on organizations to interpret broad criteria and develop comprehensive control frameworks without clear prescriptive guidance, often leading to over-engineering solutions or missing critical security gaps.

Evidence collection and documentation present another significant challenge, particularly for organizations without established compliance automation systems. Companies must continuously gather evidence across multiple systems, processes, and departments to demonstrate that their controls are not only properly designed but also operating effectively over the audit period. Manual evidence collection processes are time-consuming, error-prone, and difficult to maintain consistently, especially for Type II audits that require 3-12 months of operational evidence. Organizations often struggle to establish repeatable processes for evidence gathering that can withstand auditor scrutiny while maintaining day-to-day business operations.

Resource allocation and ongoing maintenance create substantial operational challenges for organizations pursuing SOC 2 compliance, particularly smaller businesses that may lack dedicated compliance teams. The audit process requires significant involvement from various stakeholders including IT, security, legal, and business operations teams, potentially disrupting normal business activities and requiring specialized expertise that may not exist in-house. Additionally, achieving SOC 2 compliance is not a one-time effort but requires continuous monitoring, annual audits, and ongoing control maintenance to preserve certification status, creating a perpetual resource commitment that organizations must balance against other business priorities.

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Frequently asked questions

Q: What's the difference between SOC 2 Type I and Type II audits?

A: Type I audits assess whether a company's controls are properly designed and implemented at a specific point in time, while Type II audits are more comprehensive, examining the operational effectiveness of these controls over a period of 3-12 months. Type II audits provide stronger assurance to customers and stakeholders because they demonstrate that controls work consistently over time.

Q: Which of the five Trust Services Criteria are mandatory for SOC 2 compliance?

A: Security is the only mandatory criterion for SOC 2 compliance. Organizations can choose to include any combination of the other four criteria (Availability, Processing Integrity, Confidentiality, and Privacy) based on their business operations and customer requirements. Most companies start with Security and add additional criteria as needed.

Q: How long does the SOC 2 compliance process typically take?

A: The timeline varies depending on an organization's current security posture and chosen audit type. Initial implementation of controls and policies typically takes 3-6 months, followed by the audit period itself. Type I audits can be completed relatively quickly once controls are in place, while Type II audits require 3-12 months of operational evidence before the final assessment.

Q: Is SOC 2 compliance legally required for all businesses?

A: No, SOC 2 compliance is not legally required. However, it has become increasingly important for technology and cloud computing companies that want to build trust with enterprise clients and demonstrate their commitment to data security. Many large organizations now require their vendors to have SOC 2 reports before entering into contracts. For government security and healthcare IT sectors, additional compliance frameworks may also apply.

Q: What are the biggest challenges organizations face during SOC 2 compliance?

A: The three main challenges are: 1) Navigating the framework's flexibility and subjectivity when designing appropriate controls, 2) Establishing comprehensive evidence collection and documentation processes, especially for Type II audits, and 3) Allocating sufficient resources for both initial compliance and ongoing maintenance, as SOC 2 requires continuous monitoring and annual audits to maintain certification. For more information on addressing these challenges, contact us.