Your Enterprise Customers Need SOC1 — Not Just SOC2
Most startups know SOC2. Fewer know when they need SOC1 instead — or in addition to it.
If your software processes financial transactions, affects customer financial reporting, or handles payroll, billing, or accounting data, enterprise buyers (and their auditors) will ask for a SOC1 report. No SOC1 means no deal with banks, insurers, payroll companies, and public corporations with tight internal audit requirements.
We build your SOC1 control framework from scratch, automate evidence collection, and coordinate your CPA audit — so you get your report without building a compliance team.
What Is SOC1?
SOC1 (Service Organization Control 1) is an attestation report under SSAE 18 (Statement on Standards for Attestation Engagements No. 18), issued by the AICPA.
It reports on controls at a service organization that are relevant to user entities' internal control over financial reporting (ICFR).
In plain English: your enterprise customers' auditors need to know that your software doesn't introduce risk to their financial statements. SOC1 is how you prove it.
SOC1 Type I vs Type II
SOC1 Type I — Point-in-time attestation. Confirms your controls are suitably designed as of a specific date. Faster to obtain (6–10 weeks total). Good for first-time compliance or new product lines.
SOC1 Type II — Period-based attestation. Confirms your controls operated effectively over a minimum 6-month period. Required by most enterprise buyers. Needed for annual renewal.
See our full comparison: SOC1 vs SOC2 vs SOC3 — Which Do You Need?
Who Needs SOC1?
You need SOC1 if you provide services that directly affect a customer's financial reporting:
| Industry | Example | |---|---| | Payment processing | Processing customer transactions that hit their P&L | | Payroll SaaS | Managing salary disbursements and payroll journal entries | | Accounting software | GL entries, reconciliation, financial close automation | | Banking/lending infrastructure | Loan origination, ledger management | | Insurance platforms | Premium processing, claims management | | ERP integrations | Pushing data into SAP, Oracle, NetSuite | | Healthcare billing | Medical billing touching revenue recognition | | Spend management | Expense reimbursement, AP automation |
If your customers are public companies, they are required under SOX (Sarbanes-Oxley) to obtain SOC1 reports from their service providers. That makes your SOC1 non-negotiable.
Common SOC1 Control Categories
We help you build and document controls across these areas:
Availability Controls
- System uptime and SLA monitoring
- Disaster recovery and failover procedures
- Change management and release controls
- Capacity planning
Processing Integrity Controls
- Transaction completeness and accuracy
- Error handling and exception reporting
- Reconciliation procedures
- Batch processing controls
Confidentiality Controls
- Data encryption at rest and in transit
- Access controls and least privilege
- Data retention and disposal
- Third-party data sharing agreements
Security Controls
- Logical access management
- Multi-factor authentication enforcement
- Intrusion detection and monitoring
- Vulnerability management program
Change Management Controls
- SDLC and code review procedures
- Segregation of duties in production deployments
- Rollback procedures
- Change approval workflows
Our SOC1 Readiness Process
Phase 1: Readiness Assessment (Week 1–2)
- Map your services to financial reporting impact
- Identify in-scope systems and processes
- Gap analysis against SSAE 18 requirements
- Define Trust Services Criteria applicable to your scope
- Deliver gap report with prioritized remediation plan
Phase 2: Control Framework Build (Week 2–4)
- Draft control descriptions for every in-scope control
- Write policies and procedures documentation
- Implement or remediate technical controls (access reviews, logging, encryption)
- Set up evidence collection workflows
Phase 3: Evidence Automation
We integrate with your existing tools to automate evidence gathering:
- AWS/GCP/Azure — CloudTrail, IAM access reports, config snapshots
- GitHub/GitLab — PR reviews, deployment logs, branch protection rules
- Okta/Google Workspace — User provisioning/deprovisioning logs, MFA enforcement
- Jira/Linear — Change tickets and approvals
- DataDog/PagerDuty — Uptime monitoring and incident response logs
Phase 4: Auditor Coordination
- Auditor selection and engagement (we work with Big 4 and regional CPA firms)
- Prepare management assertions
- Coordinate evidence requests and walkthroughs
- Respond to auditor queries
Phase 5: Report Delivery
- SOC1 Type I: 3–6 weeks total
- SOC1 Type II: 6-month observation + 4–6 weeks for audit fieldwork
What You Receive
- Completed SOC1 Type I or Type II report from a licensed CPA firm
- Control documentation library — policies, procedures, control matrices
- Evidence repository — organized, auditor-ready evidence packages
- Ongoing monitoring dashboard — track control effectiveness month-over-month
- Management assertion letter — signed by your leadership
- Customer-facing summary — shareable SOC1 summary for procurement teams
Timeline
| Milestone | Type I | Type II | |---|---|---| | Readiness assessment | Week 1–2 | Week 1–2 | | Control framework complete | Week 3–4 | Week 3–4 | | Audit observation period | N/A | Months 2–7 | | Audit fieldwork | Week 5–6 | Months 8–9 | | Report delivery | Week 6–8 | Month 10 |
SOC1 + SOC2: Better Together
Many companies need both. SOC2 covers your security and availability trust services for general enterprise buyers. SOC1 covers financial reporting controls for regulated industries.
We offer combined SOC1 + SOC2 sprints that share control documentation, evidence collection infrastructure, and auditor coordination — reducing total cost and time by 30–40% versus doing them separately.
- Security & SOC2 Compliance Sprint
- SOC2 Type I vs Type II: Complete Guide
- SOC1 vs SOC2 vs SOC3 Comparison
Frequently Asked Questions
Do I need SOC1 or SOC2? If your software affects customers' financial statements, you need SOC1. If enterprise buyers ask about security and data privacy more broadly, you need SOC2. Many fintech companies need both. See our SOC1 vs SOC2 comparison.
How long does SOC1 Type I take? From kickoff to report: 6–8 weeks if your controls are reasonably mature. Add 2–4 weeks if you're starting from scratch.
Can I use the same auditor for SOC1 and SOC2? Yes. We recommend it — same firm, shared evidence, lower fees.
What's the cost of a SOC1 audit? CPA audit fees range from $15,000–$40,000 depending on scope. Our readiness and coordination services are separate. Contact us for a scoped quote.
Ready to Start Your SOC1?
Don't let SOC1 requirements kill enterprise deals. We'll get you audit-ready — fast.