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A Service Organization Control 1 or Soc 1 (pronounced “sock one”) report is written documentation of the internal controls that are likely to be relevant to an audit of a customer's financial statements.
A SOC 1 Report (System and Organization Controls Report) is a report on Controls at a Service Organization which are relevant to user entities' internal control over financial reporting. SSA 18 Type I Report Background Information.
Summary. A SOC 1 report is designed to address internal controls over financial reporting while a SOC 2 report addresses a service organization's controls that are relevant to their operations and compliance. One or both could be right for your organization.
Your service organization may need a SOC 1 report because your client or regulatory body is requesting it, or maybe because you're being proactive with information security and compliance. A SOC 1 report demonstrates to your clients that you take the security of sensitive data seriously.
SOC 1: A SOC 1 examination focuses on a service organization's controls that are relevant to an audit of a service organization's client's financial statements. The service organization, with the assistance of the service auditor, will figure out the key control objectives for the services provided to their clients.
A SOC 1 engagement is an audit of the internal controls which a service organization has implemented to protect client data, specifically internal controls over financial reporting (CFR). A SOC 1 report validating the organization's commitment to delivering high quality, secure services to clients.
Summary. A SOC 1 report is designed to address internal controls over financial reporting while a SOC 2 report addresses a service organization's controls that are relevant to their operations and compliance. One or both could be right for your organization.
A SOC 2 report, similar to a SOC 1 report, evaluates internal controls, policies, and procedures. However, the difference is that a SOC 2 reports on controls that directly relate to the security, availability, processing integrity, confidentiality, and privacy at a service organization.
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