A SOC 1 Audit is an in-depth examination of a business’s internal controls and security environment that relate to financial reporting. Completing a SOC 1 Audit shows your clients, customers, and third-party partners that their financial information is fully protected. Organizations that handle large amounts of customer or client financial data benefit greatly from becoming SOC 1 certified.
SOC 1 Type 1 vs SOC 1 Type 2
The two types of SOC 1:
- Type 1: Tests the internal controls and security of an organization’s financial reporting on a specific date.
- Type 2: Tests the internal controls and security of an organization’s financial reporting over 6 to 12 months.
Type 2 audits are seen as a higher level of security compliance, but many organizations will achieve a SOC 1 Type 1 before attempting a SOC 1 Type 2 the next year.
Which Organizations Need A SOC 1?
Organizations that handle large amounts of customer financial data, such as collection agencies or third-party administrators, are the most common recipients of a SOC 1 Audit.
Why Become Certified?
Completing a SOC 1 Audit provides several key benefits:
- Proves the strength of your financial security to clients.
- Provides an overview of your organization’s internal controls and allows you to cover any potential security gaps.
- Differentiates your business from non-certified competitors.
If you would like to learn more or get started on your next SOC Audit, contact us today!
