An Overview of the SOC 2 Observation Period

If your organization falls within the scope of SOC 2, you’ll need to undergo an observation period to achieve certification. But what exactly does the SOC 2 observation period entail? Understanding this process is key to setting the foundation for long-term success and trustworthiness in the market. 

What is the Observation Period for SOC 2?

The SOC 2 observation period is mandatory for those seeking SOC 2 compliance, especially for businesses hoping to get a SOC 2 Type 2 report. Unlike the Type 1 audit, which evaluates the design of controls at a single point in time, the Type 2 report covers an extended period of time, often ranging from three to twelve months. 

As you might imagine, this requires a more in-depth auditing process. With great effort comes great reward, and organizations are increasingly realizing the value of obtaining SOC 2 Type 2 certification. It demonstrates a strong, ongoing commitment to security and compliance.

What Happens During the SOC 2 Observation Period?

During the observation period, auditors test how well an organization’s controls operate in real-world scenarios. It’s not enough for businesses to design and implement controls––they must also demonstrate that those controls hold up over an extended timeframe. This level of testing involves several activities. 

Continuous Monitoring and Evidence Gathering

Auditors expect to see ongoing processes and will collect evidence throughout the observation period. Such evidence may include log files, access control records, and security monitoring data that shows the system’s operation over time. For example, the auditor might ask for proof (logs) that showcase how sensitive information is restricted and only made available to the appropriate parties.

Controls Testing

Auditors conduct extensive testing using both manual and automated processes to evaluate the effectiveness of the organization’s controls. There are several things they might look at during this time. Say you have a control that requires the encryption of data at rest. The auditor would most likely want to test that control to make sure it does what you say it does, possibly using a sampling approach in which they test during different periods within a selected window.

Incident Response and Remediation

How you respond to security incidents matters. It’s not a question of if, but when trouble occurs, and you need to prove that you can take swift and effective action to resolve issues. To evaluate your readiness to respond and restore, auditors may ask questions like:

• Did they follow the established incident response procedures?
• Did they address vulnerabilities in a timely manner?
• What is their plan to mitigate risk going forward?

Auditors really want to see evidence that you can not only identify problems, but remediate them. Having a strong incident response and business continuity plan during the SOC 2 observation period serves as a positive indicator of operational effectiveness.

Documentation and Reporting

Throughout the observation period, you will need to provide documentation to support the auditor’s evaluations. This may include internal policies, risk assessments, and records of system configurations. Detailed documentation helps the auditor verify the effectiveness of controls. At the end of the observation period, these findings will be compiled into a report that evaluates how well the controls held up during that time.

How Long Does SOC 2 Compliance Last?

So you’ve made it through the observation period and passed with flying colors. Congratulations! But you may wonder: how long does compliance certification last? SOC 2 compliance does not have a fixed expiration date, but it is generally valid one year from the issuance of the report. 

Tips for Ensuring Ongoing Compliance With SOC 2

Achieving SOC 2 compliance can be a long and complicated process, but renewal is much more straightforward. As such, it’s important to avoid taking a lackadaisical approach. Here are some tips for ensuring ongoing compliance with SOC 2.

Keep Monitoring Your Security Controls

Just because the SOC 2 observation period has ended doesn’t mean you can push your controls to the back of your mind and forget about them. Ongoing compliance with SOC 2 requires continuous monitoring. The good news is, you can streamline the process using security information and event management (SIEM) tools, which aggregate data from various sources. This makes it easier to monitor for discrepancies or breaches. 

Perform Regular Internal Audits

Don’t rely solely on external auditors to keep your systems in check. You should be conducting your own internal assessments on a regular basis, looking specifically for gaps in your security posture. Consider auditing on a quarterly or biannual basis, as this can help you catch issues before they escalate significantly.

Foster a Culture of Continuous Improvement

SOC 2 compliance doesn’t happen overnight, and staying aligned with the required standards takes effort that extends far beyond the initial observation period. To ensure ongoing compliance, it’s important to educate employees on SOC 2 expectations and best practices. A few elements to include in your continuous compliance training program are:

• Policy Management: Evaluate and update your company’s policies. Take any needed corrective action to get them aligned with current standards. 
• Vulnerability Management: Perform regular security scans on your systems to identify any vulnerabilities. 
• Human Resources Management: Your HR team should understand SOC 2 in and out and know their role in maintaining compliance.
• Vendor Management: Monitor your company’s relationships with third-party vendors. Make sure they’re using the right security tools and processes to remain compliant with SOC 2 standards.

By continually educating employees and partners, you can create a culture where improvement becomes second nature, something that’s embedded in the fabric of your organization. 

Prepare for the SOC 2 Observation Period With Compyl

If you’re eager to get certified with SOC 2, you need to start preparing for the observation period. Compyl offers a streamlined path to SOC 2 certification, helping businesses like yours get on track to achieve and maintain compliance. Our end-to-end compliance automation platform offers everything from automated evidence gathering to framework mapping, making it easier than ever to comply with SOC 2 and other frameworks.

To learn more about how we can help you prepare for the SOC 2 observation period, get in touch with us today or request a demo.