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SOC 1 Type I & Type II

Get SOC 1 Certified in
4-6 Months, Not 12+

CPA-attested SOC 1 reports for service organizations affecting client financial statements. Required by auditors. Mandated by regulators. We handle everything.

200+
SOC 1 Reports
15+
CPA Firms
100%
Pass Rate
4-6mo
Avg Timeline

What is SOC 1?

SOC 1 (Service Organization Control 1) is a CPA-attested report on controls at a service organization relevant to user entities' internal control over financial reporting (ICFR).

Who Needs SOC 1?

  • Payroll service providers
  • Payment processors & gateways
  • Claims processing services
  • Loan servicing platforms
  • Benefits administration
  • Financial data centers
  • Banking-as-a-Service (BaaS) providers

Why It's Required

Auditor Requirement:

Your client's auditors need SOC 1 to assess risks to their financial statements. Without it, they can't rely on your controls.

Regulatory Compliance:

Financial institutions are required to assess third-party service providers. SOC 1 is the standard proof.

Contract Requirement:

Enterprise financial services contracts mandate SOC 1. No report = no contract.

SOC 1 Type I vs. Type II

Both are CPA-attested, but they test different things

SOC 1 Type I

Point-in-Time Assessment

What it tests: Controls are designed properly
Timeline: 2-3 months
Cost: ₹4-6 Lakhs

Best for:

Initial compliance, new service organizations, or when clients accept Type I

Recommended

SOC 1 Type II

Operating Effectiveness

What it tests: Controls work over 6-12 months
Timeline: 6-12 months
Cost: ₹6-10 Lakhs

Best for:

Most organizations. Auditors prefer Type II. Provides stronger assurance.

Control Objectives

Common SOC 1 Control Objectives

SOC 1 focuses on controls relevant to Internal Controls over Financial Reporting (ICFR). These are the most common control areas auditors examine.

Transaction Processing

Controls ensuring financial transactions are complete, accurate, and authorized

Authorization of transactions
Completeness of transaction capture
Accuracy of transaction processing
Proper cut-off procedures

Access Controls

Logical and physical access to financial systems and data

User access provisioning/deprovisioning
Segregation of duties
Privileged access management
Password policies and MFA

Change Management

Controls over changes to financial systems and applications

Change approval process
Testing before deployment
Segregation of development/production
Emergency change procedures

Data Integrity

Ensuring financial data remains accurate and complete

Data validation controls
Reconciliation procedures
Error handling and correction
Backup and recovery

Monitoring & Oversight

Management oversight of financial reporting controls

Control self-assessments
Exception reporting and review
Management review of reports
Internal audit activities

Vendor Management

Controls over subservice organizations affecting financial reporting

Vendor due diligence
SOC 1 report review
Complementary user entity controls
Vendor performance monitoring

SOC 1 vs. SOC 2: What's the Difference?

Both are CPA-attested reports, but they serve different purposes

SOC 1

Financial Reporting Controls

Purpose:

Reports on controls relevant to user entities' financial statement audits

Who needs it:

Service organizations that process financial transactions or hold financial data

Standard:

SSAE 18 (AT-C Section 320)

Examples:

  • • Payroll processors
  • • Payment gateways
  • • Loan servicing platforms
  • • Claims processing

SOC 2

Security & Trust Controls

Purpose:

Reports on controls relevant to security, availability, confidentiality, privacy

Who needs it:

SaaS, cloud providers, and technology companies handling customer data

Standard:

Trust Service Criteria (TSC)

Examples:

  • • SaaS platforms
  • • Cloud infrastructure
  • • Data analytics services
  • • Healthcare tech

Can you have both?

Yes! Many organizations get both SOC 1 and SOC 2. For example, a payroll SaaS platform would need SOC 1 for financial reporting controls (payroll calculations, tax withholdings) and SOC 2 for security controls (data protection, availability). We help you achieve dual compliance efficiently.

Why Choose Tranquility

Everything You Need for SOC 1

We've delivered 200+ SOC 1 reports with 100% pass rate. From ICFR control design to CPA coordination, we handle it all.

Automate Evidence Collection

Reduce manual effort with automated workflows for financial control evidence collection and testing.

  • Pre-mapped ICFR controls
  • Automated evidence capture
  • Expert-guided implementation

15+ CPA Firm Network

We coordinate with pre-vetted CPA firms specializing in SOC 1. End-to-end auditor coordination.

  • SOC 1-specialized CPAs
  • Financial services expertise
  • End-to-end coordination

Stay Audit-Ready

SOC 1 isn't one-time. Real-time control monitoring keeps you audit-ready year-round.

  • Real-time control monitoring
  • Automated evidence capture
  • Built for Type I & Type II

Manual SOC 1 vs. Tranquility

Most companies waste 6-12 months on manual SOC 1 prep. We automate 80% of it.

❌ Without Tranquility

  • Manual evidence collection200+ hours
  • Finding the right CPA firm4-6 weeks
  • Control design & documentation3-4 months
  • Audit coordination & follow-ups50+ emails
  • Total timeline12-18 months
Recommended

✅ With Tranquility

  • Automated evidence collection80% faster
  • Pre-vetted CPA networkInstant match
  • Pre-built control templates2-3 weeks
  • End-to-end coordinationZero emails
  • Total timeline4-6 months
60%
Faster Certification
80%
Less Manual Work
100%
First-Time Pass
15+
CPA Partners

The SOC 1 Audit Process

Understanding the SOC 1 journey from readiness to report delivery

1
Phase 1

Readiness Assessment

2-3 weeks
  • Scope definition: Which services affect client financial statements?
  • Control identification: Map existing controls to ICFR objectives
  • Gap analysis: Identify missing or weak controls
  • Remediation plan: Prioritize control improvements
2
Phase 2

Control Design & Implementation

4-8 weeks
  • Design controls to address identified risks
  • Document control descriptions and procedures
  • Implement controls across the organization
  • Train staff on control execution
3
Phase 3

Evidence Collection

6-12 months (Type II)
  • Collect evidence of control operation
  • Maintain audit trail for all financial transactions
  • Document exceptions and remediation
  • Prepare for CPA testing
4
Phase 4

CPA Audit & Testing

3-4 weeks
  • CPA performs control testing
  • Sample transactions and evidence review
  • Interviews with control owners
  • Identify and document exceptions
5
Phase 5

Report Issuance

1-2 weeks
  • CPA drafts SOC 1 report
  • Management review and approval
  • Final report issuance
  • Distribution to user entities
Practitioner Insights

What Auditors Actually Test

Based on 200+ SOC 1 audits, these are the areas where organizations most commonly fail

Segregation of Duties

40% fail

Common Issue:

Same person can initiate AND approve financial transactions

What auditors test:

  • User access rights analysis
  • Transaction approval workflows
  • Compensating controls for small teams

How to pass:

Implement role-based access control (RBAC) with clear separation between transaction initiation, approval, and reconciliation

Change Management

35% fail

Common Issue:

Production changes without proper testing or approval

What auditors test:

  • Sample 10-15 production changes
  • Verify approval documentation
  • Check testing evidence

How to pass:

Mandatory change tickets with approval, testing evidence, and rollback procedures for ALL production changes

User Access Reviews

30% fail

Common Issue:

Terminated employees still have system access

What auditors test:

  • Quarterly access review documentation
  • Offboarding procedures
  • Privileged access management

How to pass:

Automated quarterly access reviews with documented approval and same-day offboarding procedures

Practitioner Insight

We've delivered 200+ SOC 1 reports with 100% pass rate. The key difference between organizations that pass and those that fail? They treat SOC 1 as an operational discipline, not a compliance checkbox.Implement controls 3 months before the audit period, run internal testing, and collect evidence systematically. Most failures happen because organizations rush implementation and don't give controls time to operate effectively.