SOC 2 compliance costs can be substantial, especially if you are a small or growing business that’s bootstrapped.  However, that doesn’t make it any less worthwhile – in fact, you should view it as an investment that could bring you invaluable business in the future. With cloud-hosted applications proliferating, SOC 2 Compliance is a sure-fire way for B2B SaaS companies such as yours to tell your customers that you have the security muscle to protect your customers’ data.

Note: Here’s an interesting fact: SOC 2 isn’t a certification, even though it’s popularly called so—the successful completion of a SOC 2 audit leads to the attestation of an independent certified public accountant and not a certificate. The auditor attests to the strength of your organization’s data security and cloud security practices in the form of a SOC 2 report.

SOC 2 compliance costs overview: Key variables explored

SOC 2 compliance costs are the sum of the dollars spent, time, resources, and technological investments an organization makes to improve its security stance and comply with the SOC 2 standard. But exactly how much does SOC 2 compliance cost? The answer depends on various factors; hence, the costs will vary accordingly.

• Type of attestation required: SOC 2 Type 1 or SOC 2 Type 2 or both
• Size of the organization: Costs increase with the size of the company
• Audit scope: Costs increase with the number of Trust Service Criteria chosen
• The complexity of organization: Costs spiral up with the complexity of systems & controls
• Type of auditor chosen: CPAs (or firms) come with different price tags
• Security tools: Costs of SOC tools typically needed to ensure compliance add up too
• Readiness assessment: Costs vary based on the type of auditor chosen (optional)

Look at the image below to understand the broad cost in terms of dollars spent:

Apart from the dollar spent on tech and consulting, it includes the following  :

Cost of not getting compliant: Regulatory bodies often impose fines and penalties for non-compliance. These fines can be hefty and may increase over time if you don’t address the issue.

Auditor fees: The third-party auditor will charge the organization for assessing its security controls

Resources: This includes allocating time, effort, and money for establishing protocols, creating tactical plans, training employees, and managing the costs of monitoring, documenting, etc. If you want to calculate the effort cost to get compliant, we have a compliance effort calculator. You can check the ballpark cost by filling out your details.

Remedial expenditure: This involves the costs of corrective action that may be required in case gaps are identified during readiness assessment or final audit.

So, what does a final SOC 2 attestation look like? The end result of the SOC 2 audit can have 4 possibilities; we’ve covered them below!

How much does a SOC 2 Type 1 compliance cost?

We estimate that a SOC 2 Type 1 audit costs $5000 for up to 3 TSCs and can go up to $25000 if the audit covers more than 3 TSCs. For a more thorough estimation, go through our compliance cost calculator.

In a SOC 2 Type 1 audit, the auditor will assess your policies, procedures, and controls to ensure they’re designed to keep your customers’ data safe and secure. As mentioned earlier, the costs will depend on your organization’s size, complexity (of systems & controls), audit readiness, and the type of auditor chosen.

As much as you want to keep the costs down, choose an auditor with established credentials and experience in auditing businesses like yours. A SOC 2 compliance is as much about your security posture and best practices as it is about getting the attestation from an established CPA.

The not-so-good news? These costs don’t include the cost of readiness assessment (optional), additional security tools needed, and the lost productivity costs of involving an in-house team in the run-up to the audit and after that. We have covered thes