How to Achieve SOC 2 Compliance?

Hari Mahesh

Information security is a critical concern for any organization in the technology sector. The increase in data breaches and security hacks forced most organizations to put more attention and resources into strengthening their information security norms. Organizations that outsource their critical business operations to other vendor companies in areas like SaaS and cloud computing face a significant security risk. Any mishandled data by a person or the application can expose security breach issues like data theft, extortion, and malware installation.

Now, most companies want to know that the vendors who handle their data are committed to doing so securely and seriously. SOC 2 came into place to evaluate those companies. This document explains SOC 2, its principles, SOC 2 reports, and how to achieve it.

What is SOC 2?

The abbreviation for SOC is System and Organizational Control. SOC 2 is an information security compliance auditing procedure designed to ensure that companies securely manage data to protect their clients’ privacy and security based on the Trust Services Categories (TSC). SOC 2 is maintained by the American Institute of Certified Public Accounts (AICPA).

AICPA has developed 3 SOC reports, they are:

• SOC 1: Focuses on meeting financial standards
• SOC 2: Focuses on the protection and privacy of data based on TSC
• SOC 3: High-level public-facing report with no confidential information

SOC 2 compliance plays a crucial role when it comes to showcasing how well a vendor will handle the organization’s data securely. SOC 2 compliance is unique to each company because every company follows a different set of security practices, which is different from other companies. So, the SOC 2 compliance will be customized based on the company’s business operations.

Though it’s referred to as SOC 2 certification, it differs from conventional certifications. The SOC 2 auditors do not certify that the company has met the standard; instead, the report they provide attests to what they observed in the company’s security program. So, it is more likely to be called a “SOC 2 attestation.”

Why SOC 2 Compliance?

As we discussed earlier, with the increase in security threats and data hacking, vendor companies need to say more about their security policies. When it comes to signing a project contract, customer companies will be looking for something solid to showcase what they claim; that is why every company moves towards SOC 2 compliance to share the SOC 2 report with the customers.

When a company claims SOC 2 compliance, it has passed an independent audit verifying its strong security practices. This achievement builds trust among the clients, demonstrating a commitment to safeguarding their sensitive information. Also, having SOC 2 compliance puts the company on a competitive edge compared to others who don’t have it.

Trust Service Principles of SOC 2

To get SOC 2 certification, the auditor must certify whether the organization’s system meets one or more of the trust service criteria. They serve as assessment criteria for reporting the list of controls the organization has implemented in its security program. Let’s go through each of these principles.

Security

Security is the only mandatory criterion. Every SOC 2 audit should cover it. According to AICPA standards, they define security as – “Information and systems are protected against unauthorized access, unauthorized disclosure of information, and damage to systems that could compromise the availability, integrity, confidentiality, and privacy of information or systems and affect the entity’s ability to achieve its objectives”.

This means the organization should implement two-factor authentication, encryption, breach alerts, and firewalls. Also, they should have guidelines on company management and culture, risk assessment, cyber security strategy,

Availability

The principle of availability ensures that the systems and data must be accessible to the customer as outlined in the Service Level Agreement (SLA). For example, if the SLA agrees to 95% availability, the auditors will check that it matches the percentage outlined. They also evaluate the systems established to support performance, facilitate disaster recovery, and manage incidents. The SLA also mentions the minimum acceptable performance level of the system.

Processing Integrity

Per AICPA standards, processing integrity is when “system processing is complete, valid, accurate, timely, and authorized to meet the entity’s objectives”. The processing integrity emphasizes that your system and data are protected against unauthorized changes. So here, auditors look for good monitoring and quality assurance practices, as well as error reports and how quickly system issues are addressed.

Confidentiality

This principle mandates the protection of sensitive data from unauthorized disclosure, which involves implementing encryption, access controls, and firewalls to safeguard customer data. Also, it implements robust user permissions to ensure that only authorized personnel have access to this data. Beyond customer data, confidentiality extends to protecting clients’ intellectual property, trade secrets, and other sensitive information.

Privacy

SOC 2 compliance demands strong privacy practices for customer data. This means adhering to your privacy policy and following the AICPA’s Generally Accepted Privacy Principles (GAPP). The focus is transparency and user control over their Personally Identifiable Information (PII). Customers deserve to know how their data is used, accessed, and disposed of, with clear options for opting out, limiting use, and deletion.

Auditors will assess your communication with customers regarding their data rights and best practices for data access, retention, and deletion. Monitoring privacy compliance and handling data-related incidents are also crucial aspects.

Get Started with SOC 2 Compliance

It won’t take years to get SOC 2 certified. Instead, in a few months, your organization will get approved. Let’s check all the steps for getting certified.

Selecting the Principles

We discussed the five TSC principles, so you must select one or more principles based on your organization. As we discussed, security is mandatory, so you need to add that; along with that, you need to select other principles based on what type of business you are into. For example, if you are in the cloud, you must choose ‘Availability’. If you deal with customer data, then ‘Privacy‘ should be added. It’s based on what operations you are into; you need to select corresponding principles.

Assess current Controls

Once the principles are selected, the next step is to assess your current security practices and compare them with SOC 2 requirements. This involves identifying the gaps in your current systems and processes. This step requires an internal audit, or it may be better to hire an external auditor to ensure all areas are thoroughly reviewed.

Implement required changes

Once the above step is complete, you must start implementing the necessary changes based on the identified gaps. This could involve enhancing IT security, improving data handling procedures, and updating privacy policies. Each control should be documented carefully, which will be crucial during the audit process.

Conduct a Readiness Assessment

Before the formal audit, it is always good to have a readiness assessment with the help of an external auditor. This will help to get a clear picture of any remaining gaps in compliance and also tell how well your organization aligns with SOC 2 standards.

Select a Qualified Auditor

For the audit, choose a CPA or a firm that is qualified to perform SOC 2 audits. The auditor will assess both the design and operational effectiveness of your controls based on the SOC 2 type (Type I or Type II) you are pursuing.

Complete the Audit and Address Findings

Once the auditor completes the review, they will share a report showing any issues or gaps. You need to address those findings and ensure you adhere to SOC 2 requirements. Once all the issues are resolved, you will receive SOC 2 certification or attestation report.

SOC 2 Attestation Reports

As we know, an attestation report is provided by the auditor or CPA firms. So, there are two types of attestation reports – Type 1 and Type 2. Let’s understand these two.

• Type 1 Report: SOC 2 Type 1 focuses on how well your organization has implemented internal controls and policies at a specific point in time. Type 1 attestation is cheaper, and it takes 1 to 3 months. Usually, type 1 SOC 2 reports are requested less compared to type 2.
• Type 2 Reports: SOC 2 Type 2 reports are more comprehensive than type 1. So, the Type 2 report evaluates how the company has implemented internal controls and policies over a period of time. To get a type 2 report, the company should maintain its security policies more robustly. The attestation process for type 2 reports is 3 to 8 months. Usually, the report contains five sections.
  • An opinion letter/auditor report
  • Management assertion
  • Detailed description of the system or service being evaluated
  • Details specific to each of the Trust Services Categories being evaluated
  • Test results from testing done on the controls evaluated

To get both reports, the organization needs to undergo a mandatory audit.

SOC 2 Compliance and Role of Testing

Testing plays a crucial role in ensuring SOC 2 compliance, particularly for a SOC 2 Type 2 report, which focuses on the operating effectiveness of controls. Here’s how testing contributes to SOC 2 compliance:

• Identifying vulnerabilities: Penetration testing (pen testing) simulates cyberattacks to identify system flaws and security procedures. Vulnerability scanning can also be used to find potential security holes.
• Validating control effectiveness: Tests are designed to assess if controls work as intended. For example, testing access controls might involve verifying that only authorized users can access sensitive data.
• Providing evidence for auditors: The results of security testing provide auditors with concrete evidence to support the effectiveness of a company’s SOC 2 controls.

Let’s discuss a few common types of testing used for SOC 2 compliance.

Penetration Testing

Penetration testing or pen tests, also known as ethical hacking, simulate cyberattacks to find system vulnerabilities and security procedures. This testing is crucial, as it helps identify the weaknesses in systems defense that hackers can exploit. The process involves gathering information about the target before the test, identifying possible entry points, attempting to break in virtually or by running a real attack and reporting back the findings. Standard tools used are Burp Suite, Metasploit, and Nmap.

Vulnerability Scanning

We can Identify potential security weaknesses in systems and applications through vulnerability scanning. This process is automated and executed periodically to examine systems, networks, and applications. The scan report shows the vulnerabilities’ nature, risk type, pose, and mitigation plans. The tools that are used most are Nessus, Qualys, and OpenVAS.

Change Management Testing

Verifies that changes to systems and applications are made securely and does not introduce new risks. This type of testing is vital for maintaining system integrity, security, and functionality, as even minor changes can have unforeseen impacts. The process involves testing the change in a controlled environment, reviewing the results, and then deciding if the change can move to production. Commonly used tools involve Git, Jenkins, Selenium, and testRigor.

testRigor is an excellent choice for end-to-end testing. You can execute test cases that help verify that changes in web applications function as expected across different platforms and devices. The best part is that you can test complex scenarios through plain English test cases. testRigor is an intelligent automation testing tool that is SOC 2 Type 2 compliant. Read: How to do End-to-end Testing with testRigor.

Using testRigor, you can perform cross-browser and cross-platform testing singlehandedly. Execute test cases on the web, mobile (native, hybrid), desktop, and API using plain English commands.

login as customer
click "Verify Your KYC"
enter stored value "FirstName" into "First Name"
enter stored value "LastName" into "Last Name"
enter stored value "DOB" into "Date Of Birth"
enter stored value "address" into "Address"
enter stored value "email" into "Email ID"
enter stored value "phone" into "Mobile"
click "Save" roughly to the left of "Submit"
check the page contains "KYC Application Pending"

This sample test script demonstrates that it contains simple English steps. Additionally, with testRigor, we can create reusable functions and save them for future use. This eliminates the need to write all steps repeatedly; instead, we can simply invoke the function, such as “login as customer.” Read: How to use reusable rules or subroutines in testRigor?

Furthermore, we can store values with identifiers and easily reference them in the script, as seen in the command “enter stored value ‘FirstName’ into ‘First Name‘.” Read: How to use variables in testRigor?

testRigor helps you validate files, audio, 2FA, video, email, SMS, phone calls, mathematical validations/calculations of formulas, APIs, Chrome extensions, and many more complex scenarios. Access testRigor documentation and top testRigor’s features to learn about more valuable capabilities.

Conclusion

Achieving SOC 2 compliance is a rigorous process, but it’s essential for organizations that handle sensitive data. It requires an in-depth understanding of the Trust Services Criteria and a thorough assessment of current practices. By adhering to these standards, organizations protect their client’s data and enhance their market credibility and trustworthiness. While the journey to SOC 2 compliance demands substantial effort and resources, client confidence and operational security benefits make it a worthwhile investment for any service-oriented business.

Frequently Asked Questions (FAQ’s)

Certification costs depend on employee size, infrastructure, current technology stack, and auditor fees. On average, we estimate between USD 20,000 and USD 50,000.

SOC 2 certification is valid for 12 months; after that, you need to do the audit again and renew the certification.

Some typical challenges that companies encounter when trying to meet SOC 2 compliance include accurately defining the scope of the SOC 2 compliance framework, aligning business practices with framework requirements, properly documenting policies, selecting the appropriate auditor, conducting thorough risk assessments, choosing a penetration testing partner, and manually gathering necessary evidence.

testRigor is SOC2 and HIPAA compliant and supports FDA 21 CFR Part 11 reporting. You can efficiently perform accessibility testing through testRigor. Read here how to build an ADA-compliant app.

“We spent so much time on maintenance when using Selenium, and we spend nearly zero time with maintenance using testRigor.”

Keith Powe VP Of Engineering - IDT