​​Budgeting for SOC 2: How Much Does a SOC 2 Audit Cost?

SOC 2 audit cost

What's Inside

Thinking about SOC 2? Find out more about how much a SOC 2 audit really costs, what influences the total, and what you can expect for your business.

SOC 2 compliance plays a key role in your organization’s oversight. This is especially important when the changing environment and popularity of remote work pushes cybersecurity as a top concern for businesses. And with a 68% increase in data breaches this year, the concern is warranted. 

Additionally, as your company grows and moves up market, you’ll find that an increasing number of partners, vendors, and customers will require a SOC 2 report. 

All of these factors contribute to increasing interest in SOC 2. The problem? For many businesses, understanding the investment—both time and money—that goes into SOC 2 is oftentimes complex. In this guide, we’ll break down average SOC 2 audit costs to help you get a better insight into what you can expect.

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Factor in the Size and Complexity of Your Organization

Before we jump into all of the variables that can influence your SOC 2 audit costs, it’s important to factor in the size of your organization.

The size of your organization is usually an indicator of the complexity of your systems being audited and will have a major impact on the costs you can expect. 

SOC 2 Type 1 

A Type 1 report is a snapshot of security controls. This is an evaluation of a company at a specific point in time by an auditor and focuses only on whether controls are suitably designed. 

Typical estimates for a small to midsize company range from $7,500 to $15,000 for the audit alone. However, for larger businesses, this cost could be anywhere between $20,000 and $60,000.

SOC 2 Type 2

Type 2 looks at how well a company's controls function over a specified period of time, usually three to 12 months. One reason for the greater cost is that the auditor has to evaluate the operating effectiveness of controls in addition to the suitability of the design of the controls. 

The audit alone for a small to midsize company for SOC 2 Type 2 reports costs an average of $12,000 to $20,000. For large organizations, total costs can range from $30,000 to $100,000. 

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8 Audit Costs to Consider

Now, let’s look a little bit closer at what can impact the total cost of the endeavor. These eight elements differ significantly, based on the needs of each unique organization.

Type 1 vs Type 2

In general, a Type 2 audit will be more costly than a Type 1. That’s because a Type 1 report is just a broad picture of an organization’s overall security in a specific point in time. Type 2 audits however, are significantly more extensive and in-depth, and they also look at how the organization’s established controls perform over time. 

Keep this in mind when considering which type of SOC 2 audit you’re going to do. 

Scope

The time and effort required to conduct a SOC 2 audit varies depending on which Trust Services Categories included in the scope. You'll need to consider the complexity of your system, your web applications, and the five Trust Services Categories. These include:

  • Security

  • Availability

  • Processing integrity

  • Confidentiality

  • Privacy

In addition, audit costs could increase if you have multiple custom-developed applications in-scope for your audit and whether or not the applications share the same infrastructure.

Your Team’s Time

When going through a SOC 2 audit, keep your team’s workload and resources in mind. Many companies don’t consider the loss of productivity on other projects early on. The main reason is that it isn’t a readily apparent expenditure to account for. It’s hard to know exactly how much these costs will add up to, but being aware of this is key to not falling behind in other parts of the business.

Hiring a Consultant

Looking for outside guidance is also an option. Experts can help you better understand, prepare, and sort through the difficult tasks that come along with preparing for these audits. However, be sure to do your research before choosing a consultant. 

"The amount of resources, time, and money on consultants we saved to achieve SOC 2 Type 1 in 2 weeks is unheard of. " - Bram Ketting, 3rdRisk

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Security Tools and Employee Training

There are a few tools and services you may need to become SOC 2 compliant which will also add to your estimated cost. This can include anti-virus software, password managers, vulnerability scanners, security incident and event management (SIEM) tools, and other native services offered by your cloud service providers.

Additionally, annual online security awareness training—whether provided by a third party such as a cybersecurity firm or in-house—is key to establishing a security-first culture, but there are several costs involved. 

First, you have the cost of the training program itself and allocation time for your team to complete the training. You’ll also need to factor any costs that may come with changes to current workflows as you work towards staying as secure as possible and in compliance.

Penetration Testing

Another cost you’ll need to consider is penetration testing. 

As you prepare for your SOC 2 audit, penetration testing can help identify potential vulnerabilities in your defenses. Through a set of activities performed by security experts, you’ll be able to assess vulnerabilities in your applications, network infrastructure, and physical security barriers. Whether these experts are internal or hired from a third-party company, there will be costs associated with your organization’s penetration test.

Tech Stack 

Oftentimes, certain tools require you to purchase a higher-tiered package to access additional security-focused features like multi-factor authentication. So if you’re going for SOC 2, keep in mind that the recurring cost of your tech stack may increase as well.

Compliance Automation Software

Selecting the right compliance automation platform can make the entire SOC 2 audit process easier. Look for a tool that can grow with you and help you monitor system and security settings, build an audit trail, and automate evidence collection. While this may become a recurring cost, streamlining the execution of the audit with software and systems can lead to significant cost and time savings.

Preparing for Your SOC 2 Audit

Once you’re at the stage where you need to prepare for the audit to take place, here are some other things to consider that may impact your total cost. 

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Gap analysis

The gap analysis compares your controls to the relevant Trust Services Criteria and determines what has to be done to comply with them. Gap assessments are critical because they help inform whether or not you’re on the right track. That said, they can also identify areas where more resources may need to be spent to meet the applicable criteria. 

Implementation efforts

Identifying gaps is a good step to take, but it’s only the start. If changes, improvements, or adjustments must be made to be in compliance with security standards, you’ll need to prepare for those. As you may have guessed by now, any changes or improvements to your security program may come with additional costs. 

Remediation

Correcting errors and gaps discovered during your readiness assessment—which can vary from missing documentation to internal controls not working as planned—is part of preparing for a clean SOC 2 report. These factors can also raise the final cost.

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