☑️ SOC 2 Compliance and Certification: What SaaS Businesses Need to Know

📓 SOC 2 is a technical security audit report from the AICPA that evaluates a tech service business’s cloud security controls.

In the last two years alone, cloud-based cyberattacks more than doubled — even though SaaS spending grew just 18%.

While these numbers are merely a correlation from a statistical standpoint, it does indicate that if your business stores customer data in the cloud, it’s more important than ever for your business to take measures to secure that data. Especially given SaaS spending is expected to increase an additional 36% between 2020 and 2022.

A SOC 2 certification from the AICPA is a foundational step that will help every service provider reduce security risks. Below is a guide to SOC 2 compliance requirements and certification.

What Is SOC 2?

SOC 2 is an independent audit report that evaluates the security controls a tech service business uses to protect the data they process in the cloud. Possession of a SOC 2 report is considered table stakes in the SaaS industry, as the answers to most security questions a customer may have about their business’s security posture can usually be pulled from this report.

SOC 1 vs. SOC 2 vs. SOC 3

“SOC” stands for “System and Organization Controls” and was created by the American Institute of Certified Public Accountants (AICPA). SOC 2 is one of three SOC reports, each with different purposes and/or levels of transparency:

1. SOC 1. Used to audit internal controls relevant to a customer’s financial systems. Report usage is “restricted,” meaning its use is limited to auditors, the service organization, and authorized users.
2. SOC 2. Used to audit the overall management of customer data. Report usage is also “restricted” the same way SOC 1 is.
3. SOC 3. The same as SOC 2, but the report is simplified and publicly available to increase transparency.

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