SOC 2 Type 1 vs. Type 2: Which Certification Is Right for You?

by Shyam Mishra Global ISO Certification Services

When it comes to SOC 2 certification, there are two main types: SOC 2 Type 1 and SOC 2 Type 2. The choice between the two depends on your organization's specific needs and objectives. Let's explore the differences between SOC 2 Type 1 and Type 2 certifications to help you determine which one is right for you:

SOC 2 Type 1:

Focus: SOC 2 Type 1 evaluates the design and implementation of controls at a specific point in time. It assesses whether the organization's systems and processes are designed effectively to meet the Trust Services Criteria (TSC) defined by the American Institute of CPAs (AICPA). It does not evaluate the operating effectiveness of the controls over a period of time.

Duration: SOC 2 Type 1 assessments are typically conducted over a shorter duration, usually covering a snapshot of controls at a specific point in time.

Purpose: SOC 2 Type 1 is often used as an initial step or a baseline assessment to demonstrate that an organization has established the necessary controls and processes to meet the TSC requirements. It provides assurance to customers and stakeholders that the organization has designed and implemented appropriate controls related to security, availability, processing integrity, confidentiality, and privacy.

Reporting: SOC 2 Type 1 results in a report that details the auditor's opinion on the design and implementation of controls at a specific point in time. The report includes an assertion from management and a description of the system, as well as an opinion on the suitability of the design of controls.

SOC 2 Type 2:

Focus: SOC 2 Type 2 evaluates the design and operating effectiveness of controls over a defined period, usually a minimum of six months. It not only assesses the design of controls but also examines the implementation and ongoing effectiveness of those controls.

Duration: SOC 2 Type 2 assessments cover a longer duration to allow auditors to evaluate the operating effectiveness of controls over time. This ensures that controls are consistently applied and effective throughout the assessment period.

Purpose: SOC 2 Type 2 is more comprehensive and provides a higher level of assurance to customers and stakeholders. It demonstrates not only that the controls are designed effectively but also that they have been consistently implemented and operated over a period of time. SOC 2 Type 2 is often sought by organizations that want to provide a higher level of assurance to customers and stakeholders or need to comply with regulatory requirements.

Reporting: SOC 2 Type 2 results in a detailed report that includes the auditor's opinion on the design, implementation, and operating effectiveness of controls over a specified period. The report provides valuable insights into the organization's controls and their effectiveness.

In summary, SOC 2 Type 1 certification assesses the design and implementation of controls at a specific point in time, while SOC 2 Type 2 certification evaluates the design and operating effectiveness of controls over a defined period. SOC 2 Type 1 is typically used as an initial assessment or baseline, while SOC 2 Type 2 provides a higher level of assurance and is sought by organizations looking to demonstrate ongoing control effectiveness. Consider your organization's needs, regulatory requirements, and customer expectations to determine which certification is appropriate for you.