6 ways having a SOC report adds value to your organization
Never heard of a SOC report? You’re not alone, but we expect you will be hearing about them soon. SOC reports or System and Organization Control reports are becoming more prevalent because more and more companies are outsourcing services. When you outsource services to a third party, you hope their level of internal control is consistent with your expectations. SOC reports provide a broad range of assurance reporting frameworks that can enhance trust and address transparency issues.
It’s important for your clients to know how you and your vendors are handling sensitive data and risk management. SOC reports provide a comprehensive, repeatable and well-organized framework to communicate to your internal and external stakeholders.
In addition to providing an efficient and effective way to communicate to stakeholders, we’ve identified six ways having a SOC report adds value to your organization.
1. Efficiency. Going through the process of a SOC report requires you to formalize and document your business processes and procedures and store them in one place so they are easy to access and share, aligning organizational expectations and creating an opportunity to identify unnecessary or duplicative controls.
2. Accountability. Customers are often demanding SOC reports to prove an organization’s commitment to data security and best practices. A SOC report can provide the needed assurance that your controls are designed and operating effectively and that you’re doing what you say you’re doing.
3. Knowledge. A SOC report provides a holistic view of control activities and a starting point for identifying improvements. The process also delivers valuable insights into your organization’s risk and security posture, vendor management, internal controls governance and regulatory oversight.
4. Best Practices. SOC reports provide an avenue to introduce and establish accountability for best practices in employee training, performance management, system monitoring, system documentation and audit trail, to name a few.
5. Competitive Advantage. In some cases, having a SOC report gives you a seat at the table. There may be new markets where you want to compete and having a SOC report is the minimum requirement to gain entry or to retain customers.
6. Marketing. Your customers understand the risks posed by poor internal controls. SOC reports provide instant credibility. Having a SOC assessment and report to provide to clients can help provide the trust your clients and prospects need to do business with you.
We believe the popularity of SOC reports will continue to grow and embracing the value it creates for your organization will elevate you above your competition.
Helping clients meet standards for internal control compliance is a core focus of LWBJ. For more information or to have an initial consultation with one of our SOC experts, please contact Mike DeKock.
The material and information contained here are for general informational purposes only. You should not rely upon the material as a basis for making any business, legal or other decisions. Please contact your advisor for detailed information.