SOC 2 is a voluntary security audit framework from the American Institute of Certified Public Accountants (AICPA). It assesses how a technology or service organisation manages security, availability, processing integrity, confidentiality, and privacy. If you sell software or services to enterprise clients, especially in the US or to regulated industries, your prospects will eventually ask for a SOC 2 report.
SOC 2 is built on five Trust Services Criteria (TSC). Security is mandatory; the rest are optional:
Most SaaS companies pursuing their first SOC 2 cover Security and Availability only. Adding Privacy is common when Canadian privacy regulators (PIPEDA, provincial PIPA) are also a concern.
Enterprise clients nearly always require Type 2. Type 1 is a reasonable starting point if you need something to show prospects while building toward Type 2.
You likely need SOC 2 if:
SOC 2 is not required by law, but it is a strong sales differentiator and increasingly a gating requirement for enterprise deals in North America.
Type 1: Three to six months from the time you have controls implemented. If you are starting from scratch on access controls, logging, and incident response, add 3 - 6 months of preparation.
Type 2: Nine to 18 months total. This includes the implementation phase, a minimum six-month observation period, and the audit itself.
Expect:
Smaller organisations with a clean starting point spend less. Complex multi-region systems with many integrations spend more.
SOC 2 auditors test your controls against the Trust Services Criteria. Common evidence they request:
Is SOC 2 mandatory for Canadian companies? No. SOC 2 is voluntary. However, it is functionally mandatory if your US or enterprise buyers require it.
Is SOC 2 the same as ISO 27001? No. SOC 2 is US-auditor-driven; ISO 27001 is an international standard. Both assess security controls but have different frameworks, auditors, and recognition. Many organisations pursue SOC 2 first for the US market, then ISO 27001 for international buyers.
Can we do SOC 2 alongside PIPEDA compliance? Yes. The controls overlap significantly. A well-designed SOC 2 programme addresses most of PIPEDA's Safeguards principle.
What is the difference between SOC 1 and SOC 2? SOC 1 covers financial reporting controls (relevant for payroll processors, accounting firms). SOC 2 covers security and operations.
Can North Star IT help with SOC 2? Yes. North Star implements the technical controls, evidence collection, and documentation that SOC 2 auditors require. We work alongside your CPA-licensed auditor and can introduce you to qualified Canadian auditors.
Preparing for your first SOC 2? Call 672-983-1174 or book a free readiness discussion at northstarit.ca.
Quick answers.
What is SOC 2?
SOC 2 is a security and operations audit framework from the AICPA. It documents how your organization handles security, availability, processing integrity, confidentiality, and privacy.
Do I need SOC 2?
If you sell to mid-market or enterprise customers, especially in finance or technology, your prospects will likely ask for SOC 2. It can also be a strong sales differentiator.
How long does SOC 2 take?
Type 1 (point-in-time) can be done in 3 to 6 months. Type 2 (six-month observation period) takes 9 to 12 months including the audit.
How much does SOC 2 cost?
Auditor fees alone run 15,000 to 60,000 dollars for SMBs. Internal effort and tooling add more. Plan a six-figure budget if you have not built controls already.
Can Northstar IT help with SOC 2?
Yes. North Star runs the technical controls, evidence gathering, and documentation that auditors require. We work alongside your CPA-licensed auditor.
Have a specific situation in mind?
Book a free 30-minute scoping call with a Northstar IT engineer. We will walk through your environment, your questions, and what good looks like for your team.
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