Ship SOC 2 audits without slowing product velocity

What is SOC 2?

SOC 2 (System and Organization Controls 2) is an auditing standard developed by the American Institute of Certified Public Accountants (AICPA) that evaluates how a service organization manages customer data. A SOC 2 report is the de facto security credential for modern SaaS companies — enterprise buyers request it before signing, procurement teams rely on it during vendor reviews, and auditors consult it when assessing outsourced systems. Unlike a prescriptive standard, SOC 2 is principle-based. It does not tell you which tools to deploy; it tells you which outcomes you must demonstrate and leaves the implementation details to you.

SOC 2 evolved from SAS 70, an older attestation framework used primarily for financial reporting systems. As technology service providers increased their role in handling sensitive data, the AICPA introduced the SOC reporting suite. SOC 1 continued to address controls relevant to financial reporting. SOC 2 and SOC 3 shifted attention to information security, availability, and related commitments. Today, SOC 2 is issued under the AICPA's AT-C 105 and AT-C 205 attestation standards, following the SSAE 18 framework.

A SOC 2 engagement produces an opinion letter from a licensed CPA firm. That letter is the report buyers ask for. It documents the system under audit, the Trust Services Criteria selected, the controls in place, the testing the auditor performed, and any exceptions noted. A clean SOC 2 opinion signals to the market that a third party examined your controls and found them suitable — or in the case of Type II, found them operating effectively across a defined window.

SOC 2 is built on five Trust Services Criteria: security, availability, processing integrity, confidentiality, and privacy. Security is mandatory. The other four are optional and chosen based on your service commitments and customer expectations. Most first-time SOC 2 audits cover security alone or security plus one or two additional criteria. Scope expansion happens later, as the program matures.

SOC 2 Type I vs Type II

Every SOC 2 engagement is either Type I or Type II, and the difference matters.

A SOC 2 Type I report evaluates whether controls are suitably designed and implemented as of a single date. Think of it as a design review. The auditor confirms your policies exist, your technical controls are configured, and your processes are in place. Type I is the fastest path to a SOC 2 report and is useful when a deal is on the line, but it does not prove your controls work day after day.

A SOC 2 Type II report evaluates whether controls operated effectively across an observation period, typically three to twelve months. The auditor samples evidence from throughout the period — access reviews, change approvals, incident tickets, monitoring alerts — to confirm that controls were not just designed but consistently executed. Most enterprise buyers require a Type II, and many will not accept a Type I at all.

For a full comparison including cost benchmarks, observation period tradeoffs, and decision frameworks, see SOC 2 Type 1 vs Type 2. Related glossary terms: SOC 2 Type 2 and Trust Services Criteria.

The five Trust Services Criteria

The Trust Services Criteria define the principles your controls must satisfy. Each criterion addresses a different aspect of how a service organization protects and manages customer data.

Security (Common Criteria) — required

The security criterion, also called the Common Criteria, is required for every SOC 2 engagement. It evaluates whether the system is protected against unauthorized access — both logical and physical. The Common Criteria are organized into nine categories (CC1 through CC9) that map to the COSO internal control framework and cover governance, communication, risk assessment, monitoring, access control, system operations, change management, and vendor risk. Every SOC 2 report includes testing against these categories.

Availability

The availability criterion applies when an organization commits to specific uptime levels or recovery capabilities. It covers environmental protections, capacity planning, disaster recovery, and incident management for availability-impacting events. If your product has published SLAs or customers rely on continuous uptime, include availability. Read the availability criteria deep dive for common controls and implementation patterns.

Processing integrity

Processing integrity focuses on whether the system processes data completely, validly, accurately, timely, and with proper authorization. This criterion is relevant for platforms that perform calculations, process financial transactions, or transform customer data. It is less common in first-time SOC 2 audits but important for fintech, billing platforms, and data pipelines that customers rely on for operational decisions.

Confidentiality

The confidentiality criterion addresses information designated as confidential — distinct from personal information. It covers data classification, access restrictions, encryption, and secure disposal of confidential data. If you handle intellectual property, business plans, or other sensitive non-personal information on behalf of clients, include confidentiality. See the confidentiality criteria deep dive for details.

Privacy

The privacy criterion applies to personal information — data that can identify an individual. It evaluates whether your data practices match your stated privacy commitments across notice, choice, collection, use, retention, disclosure, security, and accuracy. Privacy aligns closely with regulations like GDPR and CCPA and is the most demanding criterion in terms of control coverage. For a full walkthrough, see the privacy criteria deep dive.

Who needs SOC 2 compliance?

SOC 2 is not legally mandated, but the market treats it as a cost of doing business. Any SaaS company, cloud service provider, managed service provider, or data processor that handles customer data is a likely SOC 2 candidate. If your customers are businesses and their security teams will scrutinize your controls before signing, SOC 2 is almost certainly on your roadmap.

Companies typically pursue SOC 2 when one or more of the following is true:

• Enterprise prospects are asking for a report during procurement or vendor reviews.
• Sales cycles are slowing because buyers are blocking deals on security questionnaires.
• Existing customers are requesting a current SOC 2 report during annual reviews.
• Investors or partners are asking about the company's security posture.
• The business is entering regulated verticals like financial services, healthcare, or government.

Industries that almost always require SOC 2 from their vendors include financial services, healthcare, legal technology, HR technology, martech that handles PII, and any B2B SaaS selling into enterprise accounts. For SaaS companies specifically, SOC 2 has become table stakes — see SOC 2 for SaaS for a deeper discussion.

The SOC 2 audit process overview

The SOC 2 audit process follows a predictable sequence. Understanding each phase prevents surprises and helps you set realistic timelines with your team and auditor.

1. Scoping and readiness assessment. Define what systems and Trust Services Criteria are in scope, then perform a readiness assessment to compare current controls against SOC 2 requirements. The output is a prioritized remediation plan.
2. Remediation. Close the gaps identified during readiness. Common items include formalizing policies, enabling MFA everywhere, centralizing logging, documenting vendor risk processes, and running tabletop exercises.
3. Auditor selection. SOC 2 audits must be performed by a CPA firm licensed to issue SOC reports. Request proposals from two to four firms, compare scope and pricing, and check references from similar companies.
4. Audit fieldwork. For Type I, the auditor validates control design at a point in time. For Type II, the auditor samples evidence from across the observation period and tests operating effectiveness.
5. Report delivery and ongoing operation. Once the report is issued, plan the next observation period so you maintain continuous coverage with no bridge gaps that buyers might question.

Most organizations complete their first Type I in three to six months and their first Type II in six to eighteen months, depending on starting maturity and observation period length.

What does SOC 2 cost?

SOC 2 cost varies widely based on scope, starting maturity, and whether you pursue Type I, Type II, or both. Auditor fees are the largest line item, but they are not the only cost. You should budget for readiness consulting, compliance tooling, internal staff time, remediation work, and penetration testing.

Typical benchmarks for a first-time SOC 2 engagement:

• Type I auditor fees: $15,000 to $40,000
• Type II auditor fees: $25,000 to $80,000
• Readiness consulting (optional): $10,000 to $40,000
• Compliance platform: $6,000 to $60,000 annually depending on vendor
• Penetration testing: $8,000 to $30,000 per test
• Internal staff time: 200 to 600 hours across the first cycle

Total first-year cost for most growth-stage SaaS companies lands between $40,000 and $200,000. See the full SOC 2 cost breakdown for detailed ranges and cost-reduction strategies.

Common SOC 2 challenges

SOC 2 programs rarely fail because the audit is unfair. They fail because organizations underestimate the operational discipline required. The challenges show up in predictable places.

• Scope creep. Teams add new systems mid-audit or expand Trust Services Criteria without revisiting the control set. Every addition extends timelines and evidence requirements.
• Evidence gaps. Screenshots expire. Configurations change. Ownership drifts between quarters. By the time the auditor asks, the evidence trail is broken.
• Cross-team coordination. SOC 2 touches engineering, IT, HR, legal, and finance. Without a single source of truth for control status, teams duplicate work or miss handoffs.
• Policy drift. Policies written for the audit do not match how the team actually operates. Auditors detect this quickly during interviews and walkthroughs.
• Vendor oversight. Third-party vendors handle critical data but are rarely monitored with the same rigor as internal systems. See vendor management for how to close this gap.
• Change management. Production changes bypass approval workflows, leaving no audit trail. Change management is a frequent source of Type II exceptions.
• Incident response immaturity. Teams have an incident response plan but have never tested it. Auditors look for evidence of real incidents handled end to end. See incident response.

A structured approach — mapping controls, evidence, and owners from day one — removes most of these friction points before they become audit findings.

How SOC 2 compares to other frameworks

SOC 2 is not the only security framework buyers may request. Understanding how SOC 2 relates to other standards helps you plan a cohesive compliance strategy rather than running parallel audits with overlapping work.

ISO 27001 is an international certification focused on information security management systems. Unlike SOC 2, which produces an auditor's opinion letter, ISO 27001 results in a certificate issued by an accredited registrar. ISO 27001 is prescriptive about building an ISMS but the control set in Annex A overlaps heavily with the SOC 2 Common Criteria. Many mature companies pursue both and reuse evidence across them. ISO 27001 tends to be preferred by European and international buyers; SOC 2 is the North American standard.

HIPAA is a US healthcare law that mandates specific safeguards for protected health information. HIPAA is a regulatory requirement rather than a voluntary attestation — there is no HIPAA certificate, but business associates and covered entities must comply. SOC 2 controls address many HIPAA administrative and technical safeguards, and a SOC 2 Type II report is often used as evidence of HIPAA compliance in vendor due diligence.

PCI DSS is the payment card industry's prescriptive standard for any organization that stores, processes, or transmits cardholder data. Unlike SOC 2, PCI DSS specifies exact controls down to firewall rules and encryption key rotation cadences. SOC 2 and PCI DSS share concepts like encryption, access control, and monitoring, but PCI DSS scope is narrower (cardholder data environment) and the requirements are more specific. Companies that process payments typically need both.

NIST Cybersecurity Framework, FedRAMP, and CMMC address additional specialized audiences — federal contractors, defense industrial base, and government-adjacent systems. These are out of scope for most commercial SaaS but worth mapping if your buyer base includes public sector.

If you are comparing SOC 2 tooling options, our Vanta vs Drata comparison covers the leading compliance automation platforms.

SOC 2 readiness checklist

A readiness checklist keeps your team focused during the months before the audit begins. The full SOC 2 checklist covers every category, but at a high level expect to address:

• Governance and policies (information security policy, acceptable use, code of conduct)
• Access control (SSO, MFA, role-based access, quarterly access reviews)
• Change management (code review, deployment approvals, production change logs)
• Vendor risk management (inventory, assessments, monitoring)
• Incident response (documented plan, tested at least annually)
• Business continuity and disaster recovery (plan with defined RPO/RTO, tested)
• Logging and monitoring (centralized logs, alerting, incident tickets)
• Security awareness training (annual minimum, tracked completion)
• HR controls (background checks, onboarding, offboarding, confidentiality agreements)
• Risk assessment (annual risk review, risk register, treatment plans)

Most companies find that the readiness phase surfaces gaps they did not know existed. That is the point — better to discover them before the auditor arrives.

Getting started with SOC 2

The best time to start a SOC 2 program is before the first buyer demands it. The second best time is now.

A reasonable starting sequence:

1. Pick your Trust Services Criteria. Security is required. Add others only if you have customer commitments that map to them.
2. Decide Type I vs Type II. If you need a report fast for a specific deal, start with Type I. If you have time and buyer pressure is general, skip straight to Type II.
3. Run a readiness assessment. Either internally or with a consultant. The goal is a prioritized remediation list, not a polished report.
4. Remediate in priority order. Address policy gaps, access control weaknesses, and logging first — these are the most common sources of findings.
5. Select an auditor. Get proposals from two to four CPA firms. Check references from similar companies. Book early — good auditors are scheduled quarters in advance.
6. Operate, collect, and iterate. Run your controls, collect evidence continuously, and prepare for fieldwork. Do not treat the audit as a one-time event.

episki was built for exactly this journey. The platform maps your controls to Trust Services Criteria, automates evidence collection, tracks ownership across teams, and gives your auditor structured access when fieldwork begins. Start a free trial or book a demo to see how SOC 2 looks with the scramble removed.