What Is SOC 2 Compliance and Why Is It Important for Accountants?
Data security is important in every business, but for accountants and accounting firms, it is an absolute necessity. Companies should always have data protection practices to ensure that their customer’s personal information and data is protected from theft, but for accountants who deal with banking and financial information, data security needs to be taken one step further.
Data security can be complicated because each business establishes its own data security standards. What may be standard practice at one company can be completely ignored by another. This makes it difficult for the consumer to know if they can trust their data with a company, or how well their data is protected.
That is where SOC 2 compliance can help. SOC 2 compliance establishes criteria for managing customer data and can serve as an indicator of meeting data security best practices.
Learn more about what SOC 2 compliance entails, and why accountants should aim to become SOC2 compliant today.
What Is SOC 2 Compliance?
System and Organization Controls for Service Organizations 2 (SOC 2) compliance was developed by the American Institute of CPAs (AICPA) and helps ensure that data is securely managed. It is broken down into five “trust service principles” that must all be met for a business to become compliant.
The five categories that must be met for SOC 2 compliance are:
- Privacy – This category focuses on how data is collected, used, retained, disclosed, and disposed. Throughout the lifespan of data, from collection to disposal, controls must be put in place to protect it from unauthorized access.
- Security – This category focuses on the general security measures in place to prevent unauthorized access. This includes internal practices and systems in place to help prevent theft or misuse of software, as well as external threats.
- Availability – While SOC 2 does help establish a set of security standards, this category is determined more by each company and their clients. This category checks to ensure that the company is following the service level agreement (SLA) with their clients in relation to the accessibility of the system, products, or services. This includes monitoring network performance and availability, security incident handling, and site failover.
- Confidentiality – This category focuses on the encryption and protection of restricted internal data within an organization. For example, confidential information can include business plans, internal price lists, or intellectual property.
- Processing Integrity – This category focuses on if the system performs its purpose in delivering the correct data to the correct user, while still protecting other data. Data processing integrity aims for the data to be complete, valid, accurate, timely, and authorized.
Why Do Accountants Need to Be SOC 2 Compliant?
For accountants, SOC 2 is not a requirement, but the benefits it provides cannot be overstated. Because accountants deal with such considerable amounts of sensitive personal information, SOC 2 compliance is a crucial step in protecting that information.
Being SOC 2 compliant sets you apart in the crowd of competitors and shows your customers that you maintain a high level of data security in everything you do. When you become SOC 2 compliant, your customers know that their personal information is always managed responsibly and that there is a system in place to help prevent data leaks or breaches.
Because SOC 2 compliance creates protective layers of data security, one of the largest benefits is what you do not have to experience. Because data is handled correctly and protected against unauthorized use, SOC 2 can significantly impact loss prevent and reduce the change of reputation damage that is associated with data breaches.
SOC 2 Compliance Starts with the Right Software
Meeting the standards of SOC 2 compliance is only possible if you choose to use the right software. By implementing software that is SOC 2 compliant, like Payroll Relief, you’re choosing to use software that can meet high data security standards.
Payroll Relief can help with more than just SOC 2 compliance. It was designed with professionals in mind giving you the tools you need to succeed.