Things Small and Mid-sized Business Need to Know About SOC 2 Compliance

SOC 2 is one of the most common compliance goals for technology companies. But what does SOC 2 compliance mean, and how can you go about achieving it? We’re here to break down the complexities of compliance requirements for you.
Things Small and Mid-sized Business Need to Know About SOC 2 Compliance

What is SOC 2 and Why Compliance?

SOC 2, developed by the AICPA, refers to a framework where organizations outline their basic structure for data security and applies to any company that uses the cloud to store its customers’ information. SOC 2 is considered a technical audit and requires companies to establish and follow strict information security policies and procedures, encompassing the security, availability, processing, integrity, and confidentiality of customer data.

Why is compliance becoming such a big thing? There are two primary drivers behind this. Every company is moving to SaaS and Cloud services. Increasingly, you are becoming more dependent on third-party providers for their internal security. Companies need to find ways to address the risks associated with the 3rd party cloud providers. 

What Does It Mean to SMBs?

Many B2B, B2C customers prefer to do business with service providers that have attained the SOC 2 attestation of compliance from an independent CPA or CPA firm. SOC 2 reports provide evidence that your business has taken steps toward handling sensitive data according to established guidelines. Customers who conduct business with you will have confidence that their data is safe, secure, available, and accessible. 

SOC 2 reporting is more adaptable than other guidelines, such as PCI DSS, and as an SMB, you can determine the best procedures for optimizing your operations to remain compliant. ISO 27001 and SOC 2 are both prime standards, if you want to know which standard is better for your organization, check out our blog “ISO 27001 Or SOC 2? How To Decide Which Audit To Pursue First”

On the other hand, SMBs are particularly at risk of data security breaches, and unlike large corporations, they lack the resources to implement and maintain cybersecurity practices.

Compliance with SOC 2 is voluntary. However, some companies may encounter certain challenges when they are trying to implement cybersecurity initiatives. Here are some tips as to how you can gain company-wide support. 

What Can SMBs Do?

  1. Identify project owners and establish a working team

This team will be the primary resource for SOC 2-related activities and should contain skilled personnel who are familiar with SOC reporting and what your business needs to do to become compliant.

A good place to start is to include members from the management team such as Chief Security Officers, Chief Information Officers, project managers, IT consultants, etc.

  1. Set specific compliance goals

The next step is to define the scope of SOC 2 reporting. Are you more concerned with a specific product/service, or would you like to expand compliance to the entire organization?

  1. Prepare and organize all relevant materials

Start by collecting all relevant data, assessing effectiveness, and identifying gaps that need to be filled. In this way, you can determine what should be done.

  1. Work with a trusted auditor

The final audit has to be issued by a CPA. It is important that you identify and work with a trusted auditor. Meeting with your auditor prior to the audit is beneficial. Your auditor can address any concerns you may have, and give you an idea of what to expect during the security audit.

Four Key Cybersecurity Practices When It Comes to Working Towards SOC 2 Compliance

Here are the four areas of security practices that are critical to meeting SOC 2 compliance.

1. Monitoring the Known and the Unknown

You need the ability to monitor not just the known malicious activity, but also the unknown. You can achieve this by baselining what normal activity looks like in your cloud environment so you can then determine what abnormal activity is.

Put in place a continuous security monitoring practice so that you can detect potential threats coming from both external and internal sources.

2. Anomaly Alerts

With proper alerting procedures in place, when there is any unauthorized access to data occurs, you have the ability to respond and take corrective action in time.

To combat noises from false positives, you need a process that sounds the alarms only when activity deviates from the norm that has been defined for your unique environment.

3. Detailed Audit Trails

Nothing is more important than knowing the root cause. Audit trails are the best way to get the insights you need to implement your security operations, giving you insights into:

  • Changes in key system components
  • Any unauthorized data and configurations modifications
  • Impact of the attack
4. Actionable Forensics

To demonstrate that you have the ability to take corrective action before a system-wide situation compromising customer data occurs, you need intelligence. Since your decisions can only be as good as the intelligence you base them on, it is very important for you to have visibility into:

  • Origin of the attack

  • Where it traveled to

  • What parts of the system are impacted

  • What its next move might be

More SOC 2 Compliance and Cybersecurity Questions Answered

SOC 2 is about putting in place well-defined cybersecurity policies, procedures, and practices. Doing so effectively builds trust with customers and end-users about your operation and infrastructure. 

Want to learn more? The good news is that can help you quickly and achieve SOC 2 compliance.

In our webinar, “SOC 2 for Startups: Preparation, Timing, Execution, Sustainment”, we also covered:

* Why SOC 2, and how it compares to other standards including ISO27001, NIST CSF, HIPAA and more

* When to start your SOC 2 journey – not too soon, not too late

* Understanding SOC 2 – Type 1, Type 2, the Trust Services Criteria

* Defining scope and key controls

* How to tackle it – partners, technology, internal readiness

* Choosing an auditor

* Sustaining SOC 2 after the initial audit

In case you missed it, you can rewatch it and learn how to accelerate your achievement of compliance, lower costs, lessen the impact on your organization and unlock business growth.

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