SOC (System and Organization Controls) certifications are designed to evaluate the controls in place at a service organization, primarily focusing on data security, availability, and processing integrity. They’re particularly relevant in cybersecurity, cloud services, and data handling. Here’s a breakdown of the two primary types:

SOC 1

Purpose: SOC 1 reports are focused on the internal controls relevant to a client’s financial reporting.

Audience: Primarily useful for clients and auditors to evaluate how the service organization’s controls may affect financial statement reporting.

Types:

Type 1: A point-in-time report, assessing the design of controls as of a specific date.

Type 2: Covers both the design and operating effectiveness of the controls over a specified period, usually six to twelve months.

SOC 2

Purpose: SOC 2 reports address a broader range of controls relevant to security, availability, processing integrity, confidentiality, and privacy (based on the AICPA’s Trust Services Criteria).

Audience: Clients, regulators, and stakeholders interested in an organization’s data management practices.

Types:

Type 1: Evaluates the design of controls at a specific point in time.

Type 2: Assesses both the design and effectiveness of the controls over a period, typically six to twelve months. Type 2 is generally more rigorous and provides greater assurance about the ongoing effectiveness of controls.

SOC 1 and SOC 2 audits are frequently pursued by service organizations to meet client requirements and enhance trust. SOC 3 is also available, which is a public report based on the SOC 2 audit but without specific details about controls and test results, making it suitable for marketing.