Service Organization Control (SOC)

August 25, 2025
Posted by: admin
Categories: Business plans, Competitive research, Information Technology, Uncategorized

SOC 1 – Internal Controls over Financial Reporting (ICFR)
- Focus: Controls that impact clients’ financial reporting.
- Audience: Auditors, CFOs, financial regulators.
- Example: Payroll processors, financial services.
SOC 2 – Trust Services Criteria (Security, Availability, Processing Integrity, Confidentiality, Privacy)
- Focus: Controls relevant to data protection & operations.
- Audience: Customers, regulators, business partners.
- Widely used in cloud and IT service providers.
- SOC 2 Type I: Point-in-time assessment (are controls designed properly?).
- SOC 2 Type II: Covers a period (6–12 months) to test operating effectiveness.
SOC 3 – Public Report
- Focus: Similar to SOC 2 but less technical.
- Audience: General public, marketing purposes.
- Usually shared as a seal of trust on websites

Trust Services Criteria (for SOC 2 & 3)
- Security – Protection against unauthorized access.
- Availability – System availability as agreed.
- Processing Integrity – Accuracy, timeliness, and validity of processing.
- Confidentiality – Protection of sensitive business data.
- Privacy – Proper handling of personal information.
Why SOC Reports Matter
- Build trust with clients and stakeholders.
- Ensure compliance with industry and regulatory requirements.
- Provide assurance over data handling, security, and operational practices.
- Competitive advantage in SaaS, fintech, healthcare IT.

SOC vs HIPAA vs ISO 27001
- HIPAA → Law (healthcare focus).
- ISO 27001 → Global standard (information security management system).
- SOC 2 → Assurance framework (security & privacy controls, widely requested by customers).
SOC 2: A SaaS company shows clients its cloud security is independently audited.
HIPAA: Hospital ensures patient records are private and secure.
ISO 27001: A multinational sets up an enterprise-wide security management system.