Texas Compliance, LLC offers the following SOC 2 compliance assessment checklist for Texas businesses seeking to undertake annual SOC 2 Type 1 and SOC 2 Type 2 audits. With more and more organizations throughout Austin, Dallas, Houston, San Antonio – and other surrounding areas – being forced to comply with the AICPA SOC reporting framework, here’s what you need to know for ensuring an efficient auditing process from beginning to end:
Essential SOC 2 Checklist for Texas Business
1. Start with a SOC 2 Scoping & Readiness Assessment: Learning about SOC 2 – all the technical merits and other important considerations – begins by performing a comprehensive SOC 2 scoping & readiness assessment. When performed correctly by a competent CPA firm, Texas businesses will gain true insight and understanding into their control environment – specifically – the current status of one’s internal policies, procedures, and processes. This is critically important because SOC 2 assessments evaluate a laundry list of “common criteria”, which are essentially an organization’s internal control framework. You’ll also gain a strong understanding of audit boundaries, personnel expectations, and much more when performing a SOC 2 scoping & readiness assessment.
2. Learn more about the SOC 2 Auditing Process: What’s an audit actually look like? Good question, so here are some things you need to know. First and foremost, it’s about providing audit deliverables to the auditors. Items such as screenshots of system settings, log reports, memos, and other system outputs are what the auditors are after, so keep this in mind. It’s also about documentation – your policies and procedures – essential documents detailing one’s internal control activities for which auditors will also be asking for. In summary, expect to be handing over a tremendous amount of material to the auditors during the SOC 2 audit process.
3. Determine Next Steps with Critical Remediation: After the successful completion of a SOC 2 scoping & readiness assessment, all businesses will have some degree of remediation to perform – after all – no single organization ever has a picture-perfect internal control environment. With that said, it’s important to begin the process of correcting all deficiencies found, especially the critical technical/I.T. challenges, which can include a wide range of issues.
Common technical remediation areas consist of re-configuring network devices, hardening servers, enforcing stronger passwords, and much more. It’s important to have capable employees on the board with the requisite skill sets that can successfully perform all necessary changes to your information systems.
4. Develop all Necessary Policies and Procedures: What’s one of the most demanding and grueling aspects of becoming SOC 2 compliant? Developing all the required information security policies and procedures and other supporting documents. In fact, whatever the regulatory compliance mandate is, documentation is often the most exhaustive aspect of becoming compliant, and its why Texas businesses are turning to Texas Compliance, LLC as we offer all of our client’s complimentary security policies consisting of hundreds of pages of information security policies, procedures, forms, checklists, and more.
5. Undertake Essential I.T./Security/Operational Remediation: While remediating policy documents can be a challenge, don’t forget about critical security remediation initiatives for many of your information systems. For example, businesses often find that they need to re-configure firewall rules, strengthen password parameters, re-provision servers – just as a few notable examples that you’ll often find in terms of security remediation.
Most of the mandates are generally done by internal employees as they know their own systems better than anyone else, but Texas Compliance, LLC does offer meaningful security remediation services, if necessary. Additionally, Texas Compliance, LLC offers helpful forms and checklists, such as provisioning and hardening guides, for helping you through the process. It’s just another example of how we go above and beyond what other CPA firms offer in terms of service.
7. Assess Third-Party Scoping Parameters: In today’s economy, outsourcing and the use of third-party entities for performing essential services is the new norm, and it’s only going to continue to grow. Therefore, organizations who are in fact outsourcing critical business functions need to be aware of having regularly scheduled due-diligence initiatives for ensuring such outsourcing entities have adequate internal controls in place.
Your internal controls are only as good as the outsourcing entity’s controls, all the more reason for having a structured, formalized, and documented process in place with checklists and other essential documents that can be used as necessary.
As for SOC 2 compliance, auditors will often want to learn more about the services being provided by third-parties, and what assessment procedures – if any – should be performed for validating an adequate system of internal controls are in place. Simply stated, assessing third-party relevance has now become an important element of SOC 2 reporting – and SOC 1 reporting – thanks to the SSAE 18 standard.
8. Work With your Auditors in Developing Assessment and Testing Criteria: Which of the relevant Trust Services Principles and Criteria (TSC) are to be included within the scope of the audit, and what deliverables are you going to provide to the auditors? These are just a few of the important things you’ll want to cover when preparing for the SOC 2 journey.
Essential SOC 2 Checklist for Texas Business