Key insights
- A SOC readiness assessment helps service organizations identify control gaps to address risks and develop a plan to address those gaps.
- By identifying areas of where controls can be enhanced and developing a corrective action plan, organizations may reduce business operations risks and improve efficiency.
- After a Type 1 assessment, organizations may choose to move on to a Type 2 assessment. A Type 2 assessment is a more comprehensive attestation evaluating an organization's compliance efforts over a period, typically at least six months.
Reduce risk and improve efficiency with a SOC assessment.
A system and organization controls (SOC) readiness assessment helps service organizations evaluate their controls against control objectives defined by the service organization (SOC 1) or criteria established by the American Institute of Certified Public Accountants (SOC 2).
It’s a valuable tool to help service organizations identify control gaps to address risks and develop a plan to address those gaps. Explore what a readiness assessment is, the value it brings, and the typical journey for a services organization from a readiness assessment to a Type 1 and a Type 2 assessment.
What is a readiness assessment?
A readiness assessment evaluates an organization’s controls against set of control objectives or criteria. It’s typically conducted before a formal examination or assessment to identify areas of noncompliance and develop a plan to address control gaps. The assessment can be conducted internally or by a third-party auditor.
The value of a readiness assessment
A readiness assessment provides several benefits to service organizations, including:
Identifying control gaps or weaknesses
A readiness assessment helps service organizations identify where controls have not been implemented or sufficiently documented to demonstrate meeting the risk identified related to the control objective or criteria. This information can be used to develop a corrective action plan to address those areas before a formal examination or assessment.
Reducing business operations risks
By identifying areas where controls can be enhanced and developing a corrective action plan, organizations may reduce business operations risks and improve efficiency. This may help avoid inefficient use of limited resources, fines, legal action, and reputation damage.
Developing the system description
A readiness assessment helps service organizations develop the system description, which is a required report component.
The journey from a readiness assessment to a Type 1 assessment
After a readiness assessment, organizations typically move to a Type 1 assessment. A Type 1 assessment is a formal attestation evaluating an organization’s compliance with its policies and procedures as of a specific point in time. A third-party auditor conducts the assessment and provides an independent evaluation of the organization’s controls.
During a Type 1 assessment, the auditor evaluates the organization’s policies, procedures, and controls to determine if they are designed and implemented. The auditor will conduct interviews with employees and review documentation to evaluate compliance.
The journey from a Type 1 assessment to a Type 2 assessment
After a Type 1 assessment, organizations may choose to move on to a Type 2 assessment. A Type 2 assessment is a more comprehensive attestation where the auditor evaluates the organization’s policies, procedures, and controls to determine if they are designed, implemented, and operating effectively over a period of time, typically at least six months to determine compliance with the established policies. A third-party auditor conducts the assessment and provides an independent evaluation of the organization’s controls.
How we can help
Engaging an experienced SOC auditor is crucial to completing a high-quality SOC examination providing meaningful value to your customers and stakeholders. With our team’s deep understanding of the ever-evolving SOC examination and reporting trends — spanning many industries and relevant frameworks — CLA can help.
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