SOC 2: A Beginner’s Guide

For founders using no-code platforms and aiming for compliance, securing your information systems and meeting established standards is crucial. The SOC 2 report, essential for businesses handling sensitive data, provides a framework for demonstrating this commitment. This article covers the basics of SOC 2, including its background, scoping, and audit process, while also addressing how compliance might be impacted for companies built on no-code platforms.

Understanding SOC 2: Background and History

The SOC 2 report, governed by the American Institute of Certified Public Accountants (AICPA), serves as a reporting framework rather than a security framework. This flexibility allows businesses to align their controls with their unique operational needs. The growing demand for assurance around information security and privacy drives the need for SOC 2 reports, especially in the B2B space, where larger companies often require SOC 2 compliance from their vendors.

For businesses using no-code platforms, understanding SOC 2's adaptability is crucial. No-code platforms can simplify the development process but also present unique challenges for compliance. Ensuring that these platforms align with SOC 2 criteria involves assessing how they handle data security, privacy, and other Trust Services Criteria.

Scoping Your SOC 2 Report

Determining the scope of your SOC 2 report is a critical step. The SOC 2 framework comprises five Trust Services Criteria: security, availability, processing integrity, confidentiality, and privacy. While security is mandatory, additional criteria are optional and can be selected based on industry norms or client expectations.

• Security: The baseline requirement for all SOC 2 reports.

• Availability: Important for organizations requiring reliable access to their services.

• Processing Integrity: Relevant for FinTech and similar sectors.

• Confidentiality: Critical for businesses handling sensitive information.

• Privacy: Essential for privacy-sensitive industries like healthcare.

No-code platforms often handle various aspects of data security and privacy, but it's essential to verify how these platforms meet SOC 2 criteria. For example, ensuring that the platform's data storage and processing practices align with confidentiality and privacy requirements is crucial.

The SOC 2 Readiness and Audit Process

The readiness phase is vital for preparing for SOC 2. It involves a gap assessment to identify existing controls and areas needing improvement. Engaging with a firm specializing in SOC 2 can streamline this process by providing guidance on necessary controls and remediation steps.

For companies built on no-code platforms, the readiness phase may include evaluating the platform's built-in security features and how they align with SOC 2 requirements. Once readiness is established, organizations proceed with the audit, which includes Type 1 and Type 2 reports.

Typical Timeline for SOC 2 Compliance

Achieving SOC 2 compliance typically takes three to six months for a Type 1 report, with an additional 12-month period for the Type 2 report. Companies using no-code platforms should consider the platform's role in this timeline, ensuring that all necessary controls are in place and effective.

Steps in the Audit Process

The audit process generally includes:

1. Conducting a readiness assessment to identify gaps.

2. Implementing necessary controls and remediation efforts.

3. Completing the SOC 2 Type 1 audit.

4. Transitioning to the SOC 2 Type 2 audit period.

Effort Breakdown by Resource

Implementing SOC 2 often requires significant resources, particularly in the first year. This includes time from teams such as engineering, product management, and security. For no-code platforms, the effort might focus on configuring the platform to meet SOC 2 requirements and ensuring that the platform’s features align with compliance needs.

SOC 2 Tips and Commonly Asked Questions

Impact of Cloud Services on SOC 2 Compliance

For organizations operating in the cloud, including those using no-code platforms, it's important to recognize that cloud service providers are considered sub-service organizations. Their controls can be included in the SOC 2 report, potentially reducing the scope and effort required for compliance. Verify that your no-code platform provider’s controls are included in your compliance efforts.

Remote Work Considerations

With remote work becoming more common, organizations must assess how their distributed team structure impacts SOC 2 compliance. No-code platforms can facilitate remote work by providing cloud-based solutions that meet security and compliance requirements, even without a physical office.

Cost of SOC 2 Compliance

The cost of SOC 2 compliance varies, typically ranging between $30,000 and $50,000 per year. For companies using no-code platforms, costs may be influenced by the platform's compliance features and the need for additional security measures.

Choosing the Right Audit Firm

Selecting the right audit firm is crucial for a successful SOC 2 engagement. Evaluate firms based on their experience, the level of customization offered, and the resources available to assist with compliance. Ensure that the firm understands the nuances of no-code platforms and can provide tailored advice.

Conclusion

Achieving SOC 2 compliance is a significant undertaking requiring careful planning and execution. For businesses using no-code platforms, this involves understanding how these platforms meet SOC 2 criteria and ensuring that controls are effectively implemented. With the right resources and support, businesses can meet compliance requirements, enhance their security posture, and build client trust.