SOC 2 Type 1 VS Type 2 – What’s the Difference?

Data breaching is a serious threat to every field of business. Security is the topmost concern for organizations. Every organization has its confidential data constantly on the stake of stealth and manipulation. This problem calls for a solid security audit system that shields your data against countless threats. A security audit is an advanced-level description of how organizations can assess their overall security position, encompassing cyber-security. There are various security audits like versions of ISO, SOC, TISAX, and more. In this blog, we will talk about SOC 2 Compliance and its type 1 and 2 difference as a security audit program.

What is a SOC 2 Audit?

A Service Organization Control or SOC 2 Audit is a security auditory procedure created to ensure that the service organizations can leniently manage their data to protect the identifications and information of their clients. In many business giants, this compliance is necessary to implement any further operations.

There are two types of SOC Reports. Type 1 determines whether a vendor can meet the trust principles, like of a specific date. On the other hand, Type 2 describes the operational effectiveness of the system to which they are applied over a disclosed period of time.

Further explained are the detailed explanations of and differences between the two types of SOC 2 audit reports.

What is SOC 2 Type 1 Report?

A SOC 2 Type 1 report analyzes the design control procedures to the service’s organization system. It attributes the system at a point in time, especially in scope, controls in place, the management of the company describing the system.

Organizations that provide cloud storage services should opt for SOC 2 Type 1 Compliance if they aim to partner with bigger firms, that consider data security as their priority. Business giants are more likely to partner with service providers that possess a Type 1 Compliance provided by a reputed auditor. Complying with this auditory process gives a competitive advantage to the service providers.

What is SOC 2 Type 2 Report?

Although Type 1 Compliance has multiple benefits, it may still fade off in comparison to its Type 2 Compliance. One may suggest that its Type 2 Compliance gives a level up to the assurance being provided by SOC 2 Type 1 Compliance. To comply with this report, a company needs to pass a thorough examination of the internal control policies and practices over a specified period of time by an auditor.

Type 2 Compliance report helps a firm to send a strong message to targeted potential costumes that it applies for the best programs on data protection and control systems. Service providers with this compliance are exposed to getting contracts from larger firms.

What is the Difference between SOC 2 Type 1 and Type 2 Reports?

Whether it’s a SOC 2 Type 1 or a SOC 2 Type 2 report, both are non-financial report control procedures under a service organization as they are related to the Trust Service Criteria. Talking about the key differences, Its Type 1 report is an attestation of controls in an organization at a particular point in time, whereas, in a Type 2 report, the attestation is done over a while, a minimum of six months.

The Type 1 reports describe the controls provided by the management of the service firms and prove that the controls are designed properly and implemented. A Type 2 report contains the description of controls given out by the management of the service organizations, attests that the controls are suitably implemented, and to the operating effectiveness of the controls.

Nowadays, almost every organization needs to undergo a third-party SOC 2 Compliance and audit. If you have queries about which type of SOC report suits your databases or have further questions regarding data protection, Contact under-controls today!

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