How do you know you can trust your software provider? Is it critical for you that they are trustworthy in protecting private data like card information, identity information, employee information, and client details? During these uncertain times, there is a greatly increased risk of data and security breaches, and you should be confident that your data is secure and in good hands. Learn more about why you should know your software provider should be SOC 1 compliant to make sure your data is secure.
What Is SOC 1 Compliance For Software Providers?
SOC 1, is an audit process performed by the American Institute of CPAs (AICPA) to certify that a software platform provider’s internal controls that have to do with financial reporting is securely protecting client and customer data. For a software provider to pass their SOC 1 audit, they must follow specific security procedures and policies. The organization or business being audited must follow the criteria and meet the requirements set and distributed by the AICPA.
SOC 1 certification lets you know that your service provider is diligent about:
- protecting client and customer data.
- Proves the security of controls relating to financial reporting.
- Maintain security of private information.
There are two types of SOC 1 audits an organization can undergo.
Type 1 Audits
A SOC 1 Type 1 report certifies the effectiveness of a business or organizations’ internal controls over their financial reporting at a specific point of time.
Type 2 Audits
A Type 2 report certifies the effectiveness of a business or organizations’ internal controls over financial reporting over a period of at least 6 to 12 months.
Utilizing a software provider who is not SOC 1 certified could be a large risk for your organization. Even if the organization could pass a SOC 1 audit, you cannot be sure of their data security if they are not properly SOC 1 certified. It would be a great idea to request a SOC 1 report before choosing any non-certified software provider to ensure the security of their financial reporting and data.
Software Providers SOC 1
Technology and software provide organizations huge benefits, but if they are not careful in their choices it could lead to an increased risk of a security breach. Technology and software need to maintain a high level of security for the best interest of the user. Identifying any potential risks and keeping control over the security of your data are large factors in becoming SOC 1 compliant. There has been a large rise in demand from businesses for their SaaS (Software as a Service) providers to centralize their processes and increase security. This demand should make any software provider feel required to be SOC 1 compliant. A software provider being SOC 1 certified ensures that the organization’s controls over users’ financial and private information are strong and user data is secure. Having completed a SOC 1 audit makes potential clients or customers confident that their critical data is secure and their risk is minimized.
To learn more about getting started on your SOC 1 Audit, contact us today!
