Key Takeaways
- Assurance Over Financial Reporting: A SOC 1® report is a critical, independent attestation that specifically evaluates the effectiveness of your internal controls related to your client’s financial reporting (ICFR).
- Validation of Controls: It certifies that your organization has the necessary safeguards and IT General Controls in place to protect sensitive business processes that could impact your partners’ financial data.
- Know Your Assurance Level: You can select a SOC 1® Type 1 report (a snapshot of control design at a specific date) or a more robust SOC 1® Type 2 report (verification of control operating effectiveness over a period of time).
Demonstrate Your Commitment
A SOC 1® report can demonstrate to your current and future clients that your organization takes data security seriously. The SOC 1® report is designed to offer clarity for clients when your services may impact their financial statements.
What is SOC 1®* Compliance?
A SOC 1® report demonstrates that your organization has effective controls and safeguards in place to protect sensitive business processes that could impact your client’s financial reporting, and the effectiveness of your organization’s IT general controls.
Why Does My Organization Need a SOC 1®*?
Does your organization impact the financial reporting of your clients? Then you need to ensure that your organization is SOC 1® compliant. For example, if a company relies on an organization for payroll processing, they may want to see a SOC 1® report for reassurance regarding their operating effectiveness. A SOC 1® report provides independent and actionable feedback to ensure that critical systems and data are properly protected.
Speak to a Compliance Specialist.
Are There Different SOC 1®* Types?
There are two different types of SOC 1® reports to consider. Your specialist can help work with you to determine which reporting type best suits your organization’s business needs.
- SOC 1® Type 1 focuses on the service organization’s system, the suitability of controls for achieving control objectives, and the description of those controls as of a specific date.
- SOC 1® Type 2 provides the same analysis and opinions that are in a SOC 1® Type 1, however, it also offers the assessor’s views on the capabilities of your controls over a specific period of time.
Auditwerx is Your SOC 1®* Report Partner
When it comes to SOC 1® reporting, select an assessor that is a true partner. Our experienced team is here for you before, during, and after your assessment. From scoping your organizational needs, to evidence gathering, to your final SOC 1® report, our full-service compliance assessment services will help make achieving your organization’s compliance goals simple. Contact a SOC 1® specialist today.
FAQs
What is the fundamental goal of a SOC 1® report?
The fundamental goal is to provide clarity and a third-party opinion to clients whose financial statements may be impacted by the services your organization provides. It is designed to give clients reassurance about your control environment.
Why is a SOC 1® report essential for my service organization?
If your company offers services like payroll processing, claims administration, or loan servicing that directly impact a client’s financial reporting, this compliance report is often a mandatory request from clients and their financial preparers to satisfy their due diligence requirements.
What is the distinction between a Type 1 and Type 2 SOC 1® report?
A Type 1 report confirms the suitability of control design as of a specific date.
A Type 2 report includes this same information but also provides an assessment of those controls’ sustained operation and effectiveness over a longer, specified period.
What is the best way to prepare for a SOC 1® report?
The most effective preparation is to complete a readiness assessment. This process involves a team of compliance professionals working with you to identify and promptly remediate any potential gaps in your controls before the final reporting begins.
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