If you are looking to perform a SOC audit on your company, you’re probably aware that there are several types of SOC reports, which may have you asking which SOC Audit type does my company need?
SOC 1 Type 1 & 2
A SOC 1 report is conducted by a third-party auditor specifically examining the effectiveness of the internal controls of a service organization related to their clients’ financial reporting and documents. The primary difference between SOC 1 Type 1 and Type 2 is that a SOC 1 Type 1 report tests the controls of your organization at a specific moment in time while a SOC 1 Type 2 report tests those controls over at least 6 months and are generally more rigorous. This type of SOC certification is perfect for letting your clients know that their financial data is secure and properly controlled.
SOC 2 Type 1 & 2
A SOC 2 report has a third-party auditor examines controls related to the availability, processing integrity, and security of non-financial systems within your organization that relate to its services. These reports are very in-depth looks at several aspects of the processes of your service organization and reassure your clients that your systems are secure and reliable. Like the SOC 1 reports, the difference between SOC 2 Type 1 and Type 2 is that type 1 examines these controls at a particular time whereas a type 2 report examines these reports over at least 6 months.
Which SOC Should I Choose?
A type 2 SOC type provides a greater level of confidence than its type 1 counterpart however a type 1 report is still very useful and typically takes less time to complete. If your company relies on trust in the security of its financial reporting then a SOC 1 report is the right SOC type for you, and if your organization relies on trust that its services are available and secure then a SOC 2 report is right for you. If a client is specifically requesting that you receive a SOC audit, they will usually state which SOC Audit type fits their needs, and you should complete the type that the client requests.
If you have any questions about which SOC certification your organization needs, or would like to set up a meeting, please contact us.
