Beyond the Checkbox: Why SOC-in-a-Box Solutions Don’t Cut It

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Beyond the Checkbox: Why SOC-in-a-Box Solutions Don’t Cut It


Beyond the Checkbox: Why SOC-in-a-Box Solutions Don’t Cut It

Beyond the Checkbox: Why SOC-in-a-Box Solutions Don’t Cut It

September 23, 2024
October 1, 2024
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Commodification is undermining SOC 2 compliance

The SOC 2 process can be a chore, no doubt about it. You’ve probably seen 'SOC-in-a-box’ solutions marketed as faster, cheaper routes to a SOC 2 report. But cheap isn’t necessarily cost-effective, and quick fixes may come at a steep price.

Data security risk grows every year. As of 2024, data breaches cost organizations around the world an average of $4.88 million per incident. Compliance has become a key selling point, and customers increasingly expect vendors to demonstrate SOC 2 compliance.

In response, we’ve seen an increase in templated, pre-packaged offerings that promise a faster, cheaper path to a SOC 2 report. The SOC-in-a-box approach, as we like to call it, may seem like an attractive shortcut, especially for organizations eager to earn their SOC 2 badge and get selling.

Unfortunately, this trend toward rubber-stamped compliance poses significant risks—not just to the organizations that turn to these solutions but also to their customers and the broader industry. Treating risk standards as a formality undermines the very purpose of SOC 2.

This ebook explains why quick-fix solutions fall short of real-world compliance needs, the repercussions for all involved, and how to maintain credibility despite this troubling trend.

Understanding SOC-in-a-box

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The rise of the templated SOC-in-a-box approach

Providers started marketing SOC-in-a-box as a convenient and budget-friendly way to obtain SOC 2 reports. These packages and platforms take a one-size-fits-all approach, using pre-set templates and checklists to streamline the SOC 2 evaluation process. 

SOC-in-a-box can appear tempting for several reasons:

  • Cost Savings: Pre-packaged tools are relatively cheap.
  • Faster Turnaround: Checklist-based processes promise to shorten the audit preparation process.
  • Simplicity: A straightforward checklist-driven process can be less intimidating for organizations with limited GRC expertise.

Sounds too good to be true, doesn’t it? 

Let’s look at how SOC-in-a-box threatens the GRC landscape on three levels.

1. Impact on organizations who use SOC-in-a-box audits

Problem #1: SOC-in-a-box audits miss important elements of compliance

By prioritizing cost and speed, SOC-in-a-box reduces the audit to a superficial review and a bureaucratic rubber stamp. This approach is not equipped to address the unique needs of an organization and the auditing standards defined by the AICPA as a result of:

  • An inability to tailor the control set to an organization's actual control implementation, as per the organization's industry, risk assessment, and management processes
  • A lack of detail in assessing an audit scope and validating that the outcome report actually covers that scope
  • A lack of audit proficiency in evaluating the controls end-to-end

Because of these inadequacies, SOC-in-a-box can give false positives, so organizations think they’re compliant when, in reality, they’re not. A false sense of security can expose organizations to risks a comprehensive audit would have identified and addressed.

Even worse, some organizations intentionally create false positives, allowing them to attest to compliance despite knowing of glaring gaps.

Learn more in our blog: GRC practitioner? Watch out: A bad common phenomenon.

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Problem #2: Not everyone will accept the SOC-in-a-box report

When prospective customers and partners conduct a security review, don’t expect to fool them with superficial SOC 2 reports. These reports are supposed to show your clients, partners, and stakeholders how committed your organization is to protecting their sensitive data. If they lack depth, GRC experts notice. 

A knowledgeable prospect may very well recognize from the cover page that your report is from a SOC-in-a-box provider, instantly diminishing their view of your security and compliance posture and damaging your team's reputation as serious GRC practitioners (and your company’s reputation in turn).

Or, they may decide your report isn’t satisfactory and ask for further evidence of compliance by sending additional questions as a part of their security review. At best, this will make the process much longer and more painful. At worst, prospective customers may decide that you fail their security review—even though you have a SOC 2 report!

If customers refuse to work with your company due to an inadequate report, then the whole SOC-in-a-box exercise will have been a waste of time and money. This could undermine trust and damage your business's reputation.

2. Impact on organizations evaluating vendors based on SOC 2 reports

Problem #1: SOC-in-a-box audits miss important elements of compliance

Let’s look at it from the other side. If you’re weighing vendors based on whether or not they have a SOC 2 report, SOC-in-a-box runs the risk of giving a false positive about their compliance posture. 

If you don’t check the report closely enough, you could assume that the vendor is compliant and can be trusted when, in fact, they aren’t, and they can’t be.

The American Institute of Certified Public Accountants (AICPA) built flexibility into the SOC 2 framework so each organization can weigh which controls are most relevant to its situation. Unfortunately, that flexibility can be abused to get away with cutting corners. Some auditors will rubber-stamp inadequate data management programs—as long as the organization technically meets the minimum standards in the SOC 2 framework.

Problem #2: Additional resources required for deeper security reviews 

Until AICPA, the Public Company Accounting Oversight Board (PCAOB), and State Boards of Accountancy crack down on audit integrity, it’s up to each organization to check the validity of potential vendors’ SOC 2 process.

If you’re concerned that vendors are trying to pass off substandard reports, one step you can take is to add a CPA peer review check to your standard security review. The AICPA requires CPAs to share their latest peer review report on request. This report will show a grade of “Pass,” “Passed with deficiencies,” or “Fail,” which should help you make your determination.

If the CPA doesn’t provide a peer review report, you can also check with the AICPA peer review database, the PCAOB database, or see if the State Board has a searchable database

The peer review process isn’t perfect, but it does add a layer of accountability.

3. Impact on the entire security community

Overarching problem: Commoditization of SOC 2

A race to the bottom for a cheaper SOC 2 badge as a selling point has ultimately cheapened the value of SOC 2. SOC-in-a-box solutions focus on the SOC 2 report rather than the comprehensive data controls the report is meant to represent. Unfortunately, this has resulted in commoditization, turning the SOC 2 audit into a box-ticking exercise for security theater. 

SOC-in-a-box has lowered the standard, diminished the inherent value of a SOC 2 report, and eroded trust in the industry as a whole.

SOC 2 is supposed to serve as an accredited standard for gauging an organization’s security posture. When it no longer serves that purpose, organizations will need to meet other standards or take different measures to prove their commitment to GRC.

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Implementing genuine compliance

The benefits of a thorough audit

Getting your SOC 2 report isn’t just about getting a badge to add to your website. The SOC 2 audit is an opportunity to bolster your privacy and security controls with outside input. An in-depth audit by a responsible CPA goes beyond 'check-the-box' exercises. The CPA will examine every aspect of your organization's controls related to the Trust Services Criteria of data security, availability, processing integrity, confidentiality, and privacy. They’ll identify risks and provide feedback to help you mitigate them. 

Improved security posture and reduced risks are just the beginning. Consider all these business benefits of proving you have effective controls:

  • Improved relationships: Trustworthy compliance practices enhance relationships with partners, customers, and stakeholders.
  • Competitive advantage: A commitment to data privacy and service continuity differentiates your organization in the marketplace.
  • Professional development: The SOC 2 process improves employees’ understanding of compliance and security practices, supporting their professional growth.
  • Increased profits: Effective controls maximize uptime and limit service interruptions, contributing to more reliable service and potentially higher revenues.

The future of SOC 2 compliance

Since half-hearted compliance is clearly not in the spirit of SOC 2, expect regulators and stakeholders to push for more detailed evaluations of an organization's controls. The AICPA could even pursue disciplinary or legal action against CPAs who have abused their license. 

The next generation of standards for SOC 2 compliance is likely to rely less on sampling and put greater emphasis on holistic assessments. While sampling made sense in the past, current technology allows for the entire population to be tested easily—so reports where entire populations are tested may become the norm. Industry benchmarks may be established to create comparisons—e.g., "less than 1% of merged pull requests did not undergo peer review"—may become a common validation procedure for the common change management control.

To stay ahead of these changes, look beyond the letter of the law. Commit to authentic, comprehensive compliance practices that optimize risk management. Be prepared to show that your compliance efforts genuinely protect data and support business integrity.

How to use technology for effective compliance

Compliance isn’t a one-and-done—in fact, SOC 2 Type II reports exist to demonstrate your ability to maintain compliance over time. And while you shouldn’t reduce the whole SOC 2 audit to checklists, that doesn’t mean there aren’t some shortcuts that you could take.

Let technology do the heavy lifting for you. You can automate evidence collection and even build tests that align with your policies and alert you of any gaps.

Whether you validate compliance of your control annually, quarterly, or even weekly, there will always be some lag time before you discover problems.  

Instead, you can track your GRC posture in real-time with automated continuous monitoring tools. With continuous monitoring, you can always check that controls are operating as intended and get alerts for any issues that arise. Continuous monitoring enhances your organization's ability to respond to evolving security threats.

Establish compliance that builds and maintains trust

An in-depth SOC 2 evaluation can be uncomfortable. It can take time. And it may cost more than you’d like. But it won’t leave any stone unturned. On the other hand, organizations that rush the SOC 2 process can find themselves vulnerable to risks that more comprehensive programs would have addressed. 

Instead of looking for shortcuts, use the SOC 2 process as an opportunity to find and fix any deficiencies in your security and compliance posture. Build in continuous monitoring as part of a commitment to upholding high standards over time. 

Real compliance takes real work. We’re here to help you do the work. Hundreds of audit, risk, and compliance experts trust Anecdotes with their GRC program. Our customers have seen a 4x ROI in their first six months and collected 3.6 million pieces of evidence 70% faster. 

Contact us today to learn more.

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