One of our most frequently asked questions is, “How much does SOC 2 certification cost?”
Frankly, most content on the topic is disappointing and doesn’t actually address the question.
But unlike other sources, we’re going to give you a detailed look at:
How SOC 2 costs are determined
The differences between SOC 2 Type 1 and SOC 2 Type 2
A breakdown of the different costs
How to manage those costs, and more.
One quick clarification before we go further – technically, there is no such thing as SOC 2 certification . We use the terminology here because we know this is how people search for it (and these are the people we want to reach and help).
But SOC 2 is not a certification. SOC 2 is an attestation. The result of becoming SOC 2 compliant is getting a SOC 2 report provided by a third-party auditor.
How Much Does SOC 2 Certification Cost?
The cost of a SOC 2 certification will depend on the size of your organization, the cost of your auditing firm, and how much work is required to prepare for it. The auditing firm, in this case a Certified Public Accountant (CPA), will evaluate your security program against the relevant Trust Services Criteria. Generally, larger organizations will spend more on SOC 2 compliance due to the greater complexity and scale of their operations.
Often overlooked: the benefits of getting SOC 2 compliant. SOC 2 gives your organization a competitive advantage and makes for an effective sales enablement tool. It can also lead to increased operational efficiencies and better risk management practices to drive long-term success. These and other factors help to justify and offset the cost of SOC 2 compliance.
One of the primary costs is that of the auditing firm. Auditing firms typically charge based on the quality of service they provide and the size of the company they’re auditing. Midsize companies can expect an auditor charge of $15,000-$50,000 for SOC 2. Larger enterprises will easily pay six figures for every audit.
Quality audits are rarely performed for less than $20,000 in our professional experience. Your mileage may vary.
Understanding SOC 2 Certification Cost
Not everybody will be satisfied with the answer “It depends,” so let’s take a closer look at the general factors that might influence the cost of getting SOC 2 compliant. Afterward, we’ll cover more costs specific to the SOC 2 process.
Company Size and Complexity
The size of your company is one of the most important factors for determining SOC 2 cost. With larger organizations, there’s more ground to cover, more complex systems, and more departments. As such, preparing and executing an audit is more time- and resource-intensive in assessing each area of the organization thoroughly.
Scope of the Audit
Building out a SOC 2 compliance program starts by determining which Trust Services Criteria your organization will choose. SOC 2 is very much an accounting framework focused on designing effective controls. It builds on and extends beyond the financial systems focus of SOC 1 to encompass the broader Trust Services Criteria, which are a set of principles established by the American Institute of Certified Public Accountants (AICPA), namely:
Security
Availability
Processing Integrity
Confidentiality
Privacy
Choosing the right criteria for your organization is based on what is relevant to your products or services relative to the scope of the audit. In our opinion, every company should pursue at least Security and Confidentiality.
Availability should be used for organizations that need high uptime on their critical systems. And Processing Integrity should be used by companies that process customer data.
Privacy, however, is typically not worth pursuing as it’s not worth much to most organizations. SOC 2 Privacy regulations simply don’t meet the standards of serious privacy regulations such as GDPR (General Data Protection Regulation) and CCPA (California Consumer Privacy Act). If your organization does handle B2C data with personally identifiable information (PII) , it makes more sense to pursue a separate privacy program.
The scope of the audit will define which of these criteria will be examined, as well as the depth at which the audit process will be performed. Therefore, the criteria directly impact the cost and time spent to complete the audit.
Another key factor is determining which type of SOC 2 compliance to pursue. There are two types of SOC 2: SOC 2 Type 1 and SOC 2 Type 2 .
SOC 2 Type 1
Both types are built around reviewing policies, controls, and procedures to ensure they meet the Trust Services Criteria. SOC 2 Type 1 specific point in time and evaluates how well the company’s controls are designed. SOC 2 Type 1 is often seen as the process of laying the groundwork for SOC 2 Type 2. Since it isn’t as time-intensive, SOC 2 Type 1 costs less.
SOC 2 Type 2
While SOC 2 Type 1 is the review and audit of how controls are designed and operating at a specific point in time, SOC 2 Type 2 covers how effectively the controls are operating over a period of time – typically six or 12 months. SOC 2 Type 2 assures that a company is actually running its cybersecurity program. It would be possible for a company to get a good SOC 2 Type 1 report but then completely fail to follow through on their commitments and recurring controls.
This assessment process is longer and more in-depth, making it more costly. But it’s also more valuable in the eyes of your clients and stakeholders, and is often considered the gold standard of compliance.
Existing Security Posture
Depending on your existing security posture, you may have to do more or less work to meet the Trust Services Criteria. For example, if you already have effectively mapped out your controls and have established extensive amounts of time-tested procedures, evidence, and monitoring, your organization will have less work to do than your unprepared counterparts to get SOC 2 compliant .
If you don’t have an existing cybersecurity program (or haven’t pursued a different cybersecurity compliance framework before), working with a compliance firm before seeking your SOC 2 compliance is a great way to prepare. Many organizations have considered it a worthwhile investment to get the help of experienced professionals who have worked with countless others to prepare for SOC 2.
Geographic Location
Your organization’s geographical location is a key factor when it comes to the cost of on-site visits and related expenses. These include transportation, accommodations, and time spent traveling. The cost will be greater for organizations in remote areas or across multiple locations, such as data centers.
Breakdown of SOC 2 Certification Costs
Now, let’s get more into the specific costs that might affect the process of getting SOC 2 compliant.
SOC 2 certification costs can be broken down into the following categories:
Auditor Fees
Remediation Costs
Technology and Infrastructure Upgrades
Internal Resource Costs
Documentation and Reporting Costs
Recurring Costs for Continued Compliance
Miscellaneous Costs
Auditor Fees
Fees charged by the auditor, which in this case is a Certified Public Accountant (CPA), make up a significant piece of the cost of SOC 2 compliance. We touched on this earlier, but these fees may vary based on:
The auditor’s location
Your organization’s location
The complexity of the audit
The auditor’s reputation
The auditor’s experience and expertise
The type of SOC 2 report (Type 1 or Type 2)
Choosing the right auditor is a matter of finding a firm with the best experience, expertise in your industry, and a proven track record of compliance success. We highly recommend not fixating on the most budget-friendly option here as it tends to only cost you more in the long run.
Remediation Costs
Remediation simply means addressing gaps and vulnerabilities in your existing security program. Again, suppose you’re well-prepared with a comprehensive program consisting of air-tight controls, evolved procedures, and strong, evidence-based systems. In this case, you’ll see tremendous cost savings in this area. Come unprepared, and you’ll have to pay for the time and money spent on remediation to get your security program up to speed.
Technology and Infrastructure Upgrades
Organizations frequently need to upgrade their technology stack during SOC 2 preparation to meet different requirements. These requirements are stringent and will not allow for outdated software or other infrastructure issues.
These upgrades might include implementing a mobile device management (MDM) tool, endpoint detection and response (EDR), Security Information and Event Management (SIEM) systems, a password manager, data encryption tools, and much more.
Many of these systems operate on subscription models now, so these costs become recurring.
Internal Resource Costs
Organizations tend to overlook the massive amount of time and effort required to pursue SOC 2 compliance. We’re talking about a significant number of hours that your employees are going to have to pour into this process, which impacts their availability and productivity on other projects. You’ll need to coordinate with multiple teams across different departments, such as IT, security, legal and compliance teams.
Not every organization can dedicate its team members to this intensive, costly process. If you find your company in this position, consider hiring external resources that can give their full attention and expertise to the process. So, either way, you will have to account for the cost of resources, whether internal or external.
Documentation and Reporting Costs
Everything must be documented during the SOC 2 audit process. More than anything, SOC 2 is uniquely a reporting framework. The cost of documentation and reporting involves the process of creating policies and procedures, producing evidence that controls are in place (and effective), and preparing audit reports, to name a few.
This is another area where it might be worth considering hiring external resources or working with a firm experienced in documentation. Truthfully, even if you have solid controls in place and everything in your security program is running smoothly, it only matters if it’s well-documented.
Recurring Costs for Continued Compliance
Achieving SOC 2 Type 2 compliance is not a one-time effort and requires ongoing maintenance. Recurring costs are necessary because continuous monitoring is required, as is preparation for subsequent audits. New SOC 2 Type 2 audits are performed usually once per period. If you choose to have a six-month SOC 2, you’ll perform an audit every six months. If you have a 12-month SOC 2, you’ll perform an audit once per year.
Miscellaneous Costs
And this is one category that we always recommend that companies leave some room for, as you can’t always pin down every specific cost. These might include employee training, third-party penetration testing, legal fees, and hiring consultants.
How to Manage SOC 2 Certification Costs
Part of the balancing act of being in your position is to justify costs and resources, so this next section is going to focus on managing SOC 2 costs without compromising on the quality of the audit.
Establish a Clear Budget
True anywhere in life, but especially true here, you should determine a clear budget before you start. This means understanding all of the potential expenses, auditor fees, and so on, that we’ve covered above. Once you think you know all the costs, you can start prioritizing them and then allocating funds so you can distribute your budget across the different categories.
One thing that makes this tricky is the uncertainty that comes with budgeting, especially when the expenses can vary so widely. You don’t want to overspend and you certainly don’t want to under-allocate.
Prioritize Cost-Efficient Practices
We want to reiterate that we don’t suggest pursuing the most budget-friendly auditing firm. However, there might be room for savings through a few cost-efficient practices.
For example, you can utilize open-source tools to work towards your SOC 2 requirements, or create a slow-and-steady approach to building an effective security program over time to distribute your budget more evenly. Feel free to get creative with this, but keep in mind that your goal is to get the maximum value for your investment.
Streamline the Audit Process
Efficient project management can reduce the time and effort to achieve SOC 2 compliance, but it requires some planning and thought.
Here are a few things you can do to increase the efficiency of your audit:
Run pre-audit assessments – Conducting your own internal audit of your security program allows you to understand it, address gaps, and prepare for the official audit.Maintain clear communication – Prevent misunderstandings and delays by keeping the lines of communication consistent and clear.Centralized documentation – There are plenty of solutions that make this simple, but if you can store, categorize, and organize necessary documentation, you’ll be able to move through the audit much more efficiently.
Plan for Long-Term Compliance
Compliance should never be seen as something you do once and it’s done. Part of the appeal of SOC 2 compliance to your customers (and what makes it a great sales enablement tool) is that you’re demonstrating a commitment to continued compliance.
Part of this planning involves preventing major remediation efforts in the future. You can prevent this through continuous monitoring, annual audits (as are required to maintain SOC 2 compliance), and ongoing training to keep staff updated on security measures.
Utilize Technology and Automation
With the right technology, you can reduce the workload (and cost) that accompanies SOC 2 compliance. While investing in the solution may require some of your budget, you can reduce the cost associated with manual, repetitive labor.
Take log monitoring as an example. There is software that will monitor logs automatically, as opposed to having a valuable employee manually check and report on logs. Plus, automation reduces the risk of human error, which might become both a compliance and a cost issue over time.
Leverage Existing Resources
Not every SOC 2 audit process needs to be created from scratch. In fact, you might have the tools you need to prepare for your SOC 2 audit ahead of time.
And not just your internal resources, which we’ve mentioned, but you can also take advantage of existing technology and infrastructure, or make some simple SOC 2-focused changes to your existing policies. If you don’t know how to use what you have and need an expert, a virtual CISO can help.
Seek Expert Advice from a Virtual CISO
A virtual CISO (Chief Information Security Officer ) brings the same expertise as a full-time CISO but on a more cost-effective, contract basis. For reference, a full-time CISO’s median salary is $243,000 per year before benefits. They can help guide you through the SOC 2 process by analyzing and improving your controls so you can be confident and prepared for your audit ahead of time. Plus, they can help ensure you’re utilizing your existing resources as efficiently as possible.
Aspect Sarah’s SaaS Startup (20 employees) Carl’s Consulting Company (125 Employees) Ernie’s Enterprise (750 Employees) Notes/Comments Auditor Cost Range $10,000 – $50,000 $20,000 – $75,000 $50,000 – $200,000 SOC 2 Type 2 Auditor costs become annual recurring expenses. Technical Control Implementation $0 – $30,000 $0 – $50,000 $0 – $100,000 Initial technology upgrades likely needed. Can include recurring subscriptions. Average Duration, from program start to complete Type 2 report. 9 – 18 months 9 – 18 months 9 – 18 months Can be shorter if mature cybersecurity program exists. Labor Hours Estimate – Initial Program (in hours) 250 – 400 300 – 600 500 – 1000 Estimate cost based on salary paid to relevant individuals. Also consider opportunity cost. Annual Labor Estimate (in hours) 100 – 200 150 – 300 200 – 500 Annual Type 2 audit takes 3 people approx. 20 hours each.
Streamline Your SOC 2 Certification with Fractional CISO
We’ve covered a lot about the costs of SOC 2 certification and yet, there is a lot more to know. The audit process itself is challenging, but it can be even more so if you’re trying to stick to a tight budget and you don’t know what to expect.
If this sounds like you, or you simply want to have somebody walk you through this process and guide you step-by-step, you might be a great fit to work with us here at Fractional CISO.
We’ll leverage our years of experience to expertly guide you through the SOC 2 process so that you’re not going in blind. By working with us, you’ll have a clear understanding of:
Choosing the right auditor
Exactly how much to budget and allocate
Maintaining and renewing your compliance
Tailoring your security program to your unique challenges
What you can expect prior to, during, and after getting SOC 2 compliant
How to prepare your organization ahead of time for optimal auditing efficiency
If you want to learn more about working with Fractional CISO or how we can help you answer all of the above questions and more, reach out to us today or check out our vCISO services for more information. We’re always happy to help.
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Frequently Asked Questions about SOC 2 Certification Costs
How Long Does SOC 2 Certification Take? The time to achieve SOC 2 compliance can vary, but SOC 2 Type 1 might take 3-6 months, while SOC 2 Type 2, depending on the duration under consideration, might take 6-18 months. This might differ based on the audit scope, the maturity of your security program, and your organization’s preparedness.
Who Issues SOC 2 Certification? Your completed SOC 2 report is issued and signed by your third-party auditor, which, in the case of SOC 2, is a Certified Public Accountant (CPA).
Does SOC 2 Expire? SOC 2 reports do not technically expire, but they rapidly lose value to customers and business partners after they are one year old. Because SOC 2 reports provide an attest it’s important to maintain continuous monitoring and to undergo annual audits. During these audits, your organization will again evaluate its effectiveness in holding to its relevant Trust Services Criteria. These regular audits also ensure that new security program changes (or new risks) are addressed.
