NDNB provides SOC 2 compliance audit reports for data analytics businesses, which are one of the fastest growing segments in the North American services economy. From mining “big data” to developing unique tools for data modeling, such entities are now being required to undertake annual SOC 2 compliance audit reports, and NDNB can help, providing both SOC 2 Type 1 and SOC 2 Type 2 reporting. It’s important to understand all critical key elements within the SOC 2 auditing world – from scoping to pricing, and more – so take note of the following topics regarding SOC 2 compliance for data analytics companies:
1. Understand the SOC 1 vs. SOC 2 Debate. Which assessment should a data analytics business undertake, SOC 1 (SSAE 18) or SOC 2? It’s a valid question – and one we receive all the time – so let’s clear the air on the SOC 1 vs. SOC 2 debate. SOC 1 reporting, which uses the SSAE 18 professional standard – is geared towards service organizations exhibiting a true relation to the ICFR element – “Internal Controls Over Financial Reporting”.
Simply stated, if a service organization is performing function for clients that could impact the client’s financial reporting, then SOC 1 is the preferred assessment. However, if your company is more technology driven – for which data analytics entities are – then the AICPA SOC 2 framework is much better assessment solution than SOC 1. Furthermore, not only is SOC 2 become the standard, de facto assessment for technology companies, it’s also become very well-known and respected in the world of regulatory compliance.
2. Pick the CORRECT Trust Services Criteria (TSC). If it’s SOC 2 that you’ve decided upon, then it’s time to determine which of the five (5) Trust Services Criteria (TSC) to include for purposes of audit scope – one, two, all of them? The best answer to this is first finding out what legal and contractual requirements you may have, then identifying any other significant issues that could help in picking the correct TSC’s. As for data analytics businesses, the two (2) most commonly tested TSC’s are security and availability. “Security” in that the entire platform is safe and secure, and “availability” in that the service provided are available, void of downtime, particularly in a cloud based model. The remaining three (3) TSC’s – confidentiality, processing integrity, and privacy, can possibly be added if needed.
3. Be aware of Remediation and Documentation. A big part of SOC 1 and SOC 2 success is the ability for service organizations to actively identify and remediate various operational and I.T. processes. This often requires comprehensive documentation to be in place, which ultimately means developing InfoSec documents. Remember that technical remediation can be a time-consuming process, so keep this in mind.
Also, note that making infrastructure and security setting changes to system resources – such as enhancing firewall rulesets, implementing a more formalized data backup plan, and more – are all part of remediation when it comes to SOC 1 and SOC 2 compliance. In summary, look upon both the SOC 1 and SOC 2 assessment frameworks as those that test a multitude of internal controls relating to a service organization’s I.T., operational, and infrastructure environment.
5. Work with Industry Leaders. You don’t trust your oil changes, dry cleaning, baby sitting – and other essential life duties to just anyone, do you – so think in the same way when choosing a provider for annual SOC 2 compliance, which means looking to the experts at NDNB. As compliance experts for decades, NDNB has issued hundreds of SOC 1 and SOC 2 reports, so let’s talk! From technical remediation to fixed-fee assessments, we offer the very best service and solutions for today’s growing regulatory compliance mandates, no question about it. Remember something very important – and obvious – regulatory compliance is here to stay, so now’s the time to find a firm you can work with for years to come, and that’s NDNB!