SOC 2

Learn what SOC 2 compliance is, who needs it, and how it helps organizations build trust, strengthen security, and meet enterprise customer expectations.

What Is SOC 2 Compliance?

SOC 2 compliance refers to an independent assessment of an organization's controls for protecting customer data. Unlike a certification, SOC 2 is an attestation (not a certificate) performed by a licensed CPA firm under standards developed by the American Institute of Certified Public Accountants (AICPA).

During the engagement, auditors evaluate whether an organization's controls are suitably designed and, for Type II reports, whether they operate effectively over time against one or more of the five Trust Services Criteria.

SOC 2 is primarily designed for SaaS providers, cloud service providers, managed service providers (MSPs), fintech companies, healthcare technology vendors, and other organizations that store, process, or transmit customer information.

» Make sure you what a SOC 2 audit are and how it works

» Simplify your SOC 2 compliance journey today with our expert guidance

What Does SOC 2 Stand For?

SOC 2 stands for System and Organization Controls 2. Introduced by the AICPA in 2010, the framework was created to help service organizations demonstrate that they have appropriate controls in place to protect customer data.

Unlike frameworks that prescribe a fixed set of technical requirements, SOC 2 allows organizations to design controls that fit their business while meeting the applicable Trust Services Criteria.

The Five Trust Services Criteria

Every SOC 2 engagement is evaluated against the Trust Services Criteria (TSC), a set of principles developed by the American Institute of Certified Public Accountants (AICPA) to assess how organizations protect customer data.

Take note: Security is the only mandatory criterion, while the other four are selected based on your organization's services, the type of data you handle, and customer or regulatory requirements.

The five Trust Services Criteria are:

Security (Mandatory): Protects systems and data against unauthorized access, cyber threats, and other security risks through administrative, technical, and physical safeguards.
Availability: Ensures systems remain operational and accessible according to business commitments and service level agreements (SLAs).
Processing Integrity: Confirms that systems process data accurately, completely, and in a timely manner.
Confidentiality: Protects sensitive business information from unauthorized access, disclosure, or misuse.
Privacy: Governs how personal information is collected, used, retained, disclosed, and disposed of in accordance with privacy commitments and applicable regulations.

SOC 2 Type I vs. Type II

Organizations pursuing SOC 2 compliance can choose between a Type I or Type II report. While both evaluate controls against the Trust Services Criteria, they differ in scope and the level of assurance they provide.

SOC 2 Type I	SOC 2 Type II
Evaluates whether controls are suitably designed at a specific point in time.	Evaluates both the design and operating effectiveness of controls over an observation period, typically 3–12 months.
Provides a snapshot of your security controls.	Demonstrates that controls operate consistently over time.
Faster to complete and often used as a first step toward compliance.	Provides stronger assurance and is the report most enterprise customers request during vendor evaluations.

Organizations that are just beginning their compliance journey may start with a SOC 2 Type I report to demonstrate that appropriate controls have been implemented.

However, if your goal is to win enterprise customers, shorten security reviews, or meet procurement requirements, a SOC 2 Type II report is generally the better choice. Because it demonstrates that controls have been operating effectively over time, it provides the level of assurance that most enterprise buyers expect before entering into a business relationship.

» For a deeper look at each report type, see our guides on SOC 2 Type I and SOC 2 Type II

SOC 1 vs. SOC 2 vs. SOC 3

Although they're part of the same family of reports developed by the AICPA, SOC 1, SOC 2, and SOC 3 serve different purposes and audiences.

SOC 1: Focuses on controls relevant to a customer's financial reporting. It is primarily intended for auditors, finance teams, and organizations whose services could impact their clients' financial statements.
SOC 2: Evaluates an organization's security and operational controls against the Trust Services Criteria. It is designed for service organizations that store, process, or manage customer data and is commonly requested by customers during vendor security assessments.
SOC 3: Provides a public-facing summary of a SOC 2 report. Unlike a SOC 2 report, which contains detailed audit findings and is typically shared under a non-disclosure agreement (NDA), a SOC 3 report is intended for broader distribution and can be used to demonstrate your commitment to security without disclosing sensitive information.

» Read the full breakdown: SOC 1 vs. SOC 2, and if you're weighing whether to publish a public-facing summary, see What's in a SOC 3 Report?

Who Needs SOC 2?

SOC 2 is designed for service organizations that store, process, or manage customer data on behalf of other businesses. While it's most commonly associated with SaaS companies, many organizations across different industries pursue SOC 2 to meet customer expectations and demonstrate a strong security posture.

Organizations that commonly benefit from SOC 2 include:

SaaS companies handling customer data or business-critical applications.
Cloud infrastructure providers delivering hosting, storage, or computing services.
Managed Service Providers (MSPs) managing customer IT environments and systems.
Fintech companies processing financial data or supporting financial services.
Healthcare technology vendors handling protected health information or other sensitive data.

» If you're an early-stage company, see our dedicated guide: SOC 2 for Startups

Why SOC 2 Compliance Matters

An independent SOC 2 report demonstrates that your organization has implemented controls to protect customer data, helping build trust with prospects, customers, and partners.

Some of the key benefits include:

Builds customer trust: An independent attestation provides assurance that your security controls have been evaluated by a qualified third party.
Accelerates enterprise sales: Many enterprise procurement teams request a SOC 2 report before signing a contract. Having one ready can reduce delays caused by lengthy security reviews and questionnaires.
Reduces business risk: Implementing SOC 2 controls strengthens your overall security posture, helping reduce the likelihood of data breaches, operational disruptions, and compliance issues.
Creates a competitive advantage: As security becomes a key purchasing criterion, SOC 2 can help your organization stand out from competitors that cannot demonstrate the same level of assurance.

According to IBM's Cost of a Data Breach Report 2024, the global average cost of a data breach reached US$4.88 million, highlighting the importance of implementing effective security controls before an incident occurs.

» Learn more about the sales impact: Why Buyers Ask for SOC 2 Report

SOC 2 Requirements and Common Controls

Rather than prescribing a fixed checklist, SOC 2 requires organizations to implement controls that support the applicable Trust Services Criteria. The specific controls will vary depending on your business, systems, and audit scope, but several are commonly expected across most SOC 2 engagements.

Common control areas include:

Access control: Restricting system access based on user roles and the principle of least privilege.
Change management: Reviewing, testing, and approving system changes before deployment.
Incident response: Establishing documented procedures for detecting, responding to, and recovering from security incidents.
Vendor management: Assessing and monitoring third-party vendors that may introduce security risks.
Continuous monitoring: Logging system activity and monitoring for suspicious behavior or potential threats.
Encryption: Protecting sensitive data both in transit and at rest using appropriate encryption methods.

» Penetration testing is often an important control supporting the Security criterion. Learn more in Penetration Testing for SOC 2 Compliance

How Long Does SOC 2 Take and What Does It Cost?

The time and cost required to achieve SOC 2 compliance depend on your organization's size, existing security maturity, and the type of report you're pursuing.

A SOC 2 Type I engagement can often be completed within a matter of weeks once your controls are in place.

A SOC 2 Type II engagement includes an observation period that typically lasts three to twelve months.

Costs vary depending on factors such as audit scope, business complexity, and readiness.

» For a full cost and timeline breakdown, see SOC 2 Attestation Costs and SOC 2 Readiness Assessment: Cost & Timeline

How to Prepare for a SOC 2 Audit

Preparing for a SOC 2 audit begins well before the auditor arrives. Taking a structured approach helps identify gaps early, strengthen your security controls, and streamline the audit process.

A typical SOC 2 preparation process includes:

Conduct a gap assessment to identify areas that need improvement.
Remediate gaps by implementing or updating policies, procedures, and technical controls.
Collect evidence demonstrating that controls have been implemented and are operating effectively.
Select an independent CPA firm to perform the SOC 2 audit.
Complete the SOC 2 audit and address any findings where necessary.

» Use our full SOC 2 Audit Preparation Checklist and How to Conduct a SOC 2 Gap Assessment to get started

Continue Your SOC 2 Journey with GRSee

Whether you're just beginning your SOC 2 journey or preparing for your next audit, GRSee is here to help. Explore the guides throughout this SOC 2 resource hub for expert insights on report types, audit preparation, costs, requirements, and best practices.

When you're ready, our team can support your organization with readiness assessments, penetration testing, and compliance expertise to help you achieve SOC 2 with confidence.

FAQs

Is SOC 2 mandatory?

No. SOC 2 is voluntary, but many enterprise customers require it as part of their vendor risk assessment.

Is SOC 2 a certification or an attestation?

SOC 2 is an attestation, not a certification. A licensed CPA firm issues a report evaluating your organization's controls.

How do you "pass" a SOC 2 audit?

There is no formal pass or fail. The auditor issues an opinion on whether your controls meet the applicable Trust Services Criteria.

Is SOC 2 the same as ISO 27001?

No. SOC 2 is an attestation based on the Trust Services Criteria, while ISO 27001 is an internationally recognized certification for information security management.  

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