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SOC 1 Compliance
Conducting a SOC 1 involves guiding our clients through the process of preparing for a SOC 1 audit, which focuses on the controls relevant to financial reporting.
Step 1Understanding your Operations and Systems
Assess Client’s Environment: Get an understanding of the client's business processes, particularly those related to financial reporting.
Understand Outsourced Services:
Determine which services provided by the client are relevant to their customers' financial reporting.
Define Control Objectives: Work with the client to understand their control objectives related to these services (e.g., payroll processing, data management).
Understand Outsourced Services:
Determine which services provided by the client are relevant to their customers' financial reporting.
Define Control Objectives: Work with the client to understand their control objectives related to these services (e.g., payroll processing, data management).
Step 2Readiness Assessment
Gap Analysis: Perform a readiness assessment or gap analysis to identify the current state of internal controls and whether they align with the SOC 1 requirements.
Review Existing Controls: Assess the design of the existing internal controls over financial reporting.
Identify Control Deficiencies: Point out any control deficiencies, gaps, or areas of improvement.
Control Mapping: Map existing controls to the appropriate control objectives for financial reporting.
Review Existing Controls: Assess the design of the existing internal controls over financial reporting.
Identify Control Deficiencies: Point out any control deficiencies, gaps, or areas of improvement.
Control Mapping: Map existing controls to the appropriate control objectives for financial reporting.
Step 3Gap remediation
Recommend Improvements: Provide recommendations to remediate any control gaps. This might include revising policies, improving documentation, enhancing segregation of duties, or implementing new controls.
Testing New Controls: Ensure that any new controls or remediated controls are properly tested and working effectively before the audit.
Testing New Controls: Ensure that any new controls or remediated controls are properly tested and working effectively before the audit.
Step 4Prepare Policies and Procedures
Develop or Update Control Narratives: Assist in creating or updating documentation that describes the controls in place, such as process narratives, policies, and procedures.
Create Control Matrices: Develop detailed control matrices that map the control objectives to the specific controls in place.
Flowcharts: Use flowcharts to visually depict key processes and how they align with control objectives.
Create Control Matrices: Develop detailed control matrices that map the control objectives to the specific controls in place.
Flowcharts: Use flowcharts to visually depict key processes and how they align with control objectives.
Step 5Pre-Audit Testing and Review
Internal Review of Controls: Conduct a pre-audit review to test the operating effectiveness of key controls.
Simulation of Audit Process: Walk through a simulated audit, mimicking the SOC 1 audit process to ensure readiness.
Sampling: Help the client determine appropriate sampling techniques for testing controls.
Simulation of Audit Process: Walk through a simulated audit, mimicking the SOC 1 audit process to ensure readiness.
Sampling: Help the client determine appropriate sampling techniques for testing controls.
Step 6Coordination with External Auditors during audits
Engage External Auditors: Once the client is ready, coordinate with external auditors to begin the formal SOC 1 audit process.
Facilitate Audit Process: Assist with responding to auditor queries, ensuring proper access to evidence, and managing any issues that arise during the audit.
Facilitate Audit Process: Assist with responding to auditor queries, ensuring proper access to evidence, and managing any issues that arise during the audit.
Step 7Provide Post-Audit Support
Review Auditor Findings: After the audit, review any control deficiencies or findings raised by the auditors.
Remediation Plan: If needed, assist in developing a plan to remediate any issues identified during the audit.
Ongoing Monitoring: Support the client in establishing an ongoing monitoring process for controls to ensure continued compliance with SOC 1 requirements.
Remediation Plan: If needed, assist in developing a plan to remediate any issues identified during the audit.
Ongoing Monitoring: Support the client in establishing an ongoing monitoring process for controls to ensure continued compliance with SOC 1 requirements.
These steps will ensure that you are well-prepared for a successful SOC 1 audit
We help prepare you and help in maintaining effective controls over financial reporting.
