When MSPs evaluate cybersecurity vendors, a SOC 2 audit is one of the first things they look for. But other than knowing it’s good to have, many people still aren’t entirely sure what SOC 2 actually means or whether it should be a hard requirement when choosing a managed service provider software.
Here’s a practical breakdown of what SOC 2 is, how companies get it, who actually needs it, and how MSPs should think about SOC 2 when evaluating vendors.
SOC 2 stands for System and Organization Controls 2. It’s a cybersecurity auditing framework developed by the American Institute of Certified Public Accountants (AICPA) to evaluate how organizations handle customer data.
A SOC 2 audit examines whether a company has proper controls in place around areas like:
Most technology vendors pursue SOC 2 because customers want reassurance that their data is being handled responsibly and securely.
Unlike some compliance frameworks that focus on a checklist of technical controls, SOC 2 evaluates whether a company’s policies, procedures, and operations actually work in practice.
There are two main types of SOC 2 reports:
Evaluates whether a company’s controls are designed appropriately at a specific point in time.
Think of this as:
“Do the right security controls exist?”
Evaluates whether those controls operate effectively over a period of time (typically 3–12 months).
Think of this as:
“Are the controls consistently followed and enforced?”
Type II reports generally carry more weight because they demonstrate ongoing operational maturity rather than just documentation.
Getting a SOC 2 report isn’t as simple as filling out a questionnaire.
A company must work with a licensed third-party auditing firm that reviews its systems, policies, security controls, and operational processes.
The process typically includes:
The company determines which systems, products, and Trust Service Criteria will be included.
This may involve:
Auditors review documentation, screenshots, system configurations, policies, and activity logs to validate controls.
The auditing firm evaluates whether controls are properly designed (Type I) and/or consistently operating over time (Type II).
If the company passes the audit, they receive a SOC 2 report they can share with customers and prospects under NDA.
It’s important to note:
Companies are not technically “SOC 2 certified.”
SOC 2 is an attestation report, not a certification program. You may hear many managed service provider softwares use the phrase “SOC 2 certified” conversationally because it’s easier for buyers to recognize, however, the correct phrasing would be “we’ve completed our SOC 2 examination” or “we’ve received our SOC 2 report.”
Not every business needs SOC 2.
But if your company:
… SOC 2 is important.
For SaaS vendors especially, SOC 2 is often table stakes during procurement reviews.
Many MSPs now expect vendors to have:
Without these, vendors may struggle to pass security reviews or earn trust with larger clients.
Short answer: No — but it should absolutely factor into your evaluation process.
SOC 2 is a strong indicator that a vendor takes security seriously, but it should not be the only thing you evaluate.
A vendor can have a SOC 2 report and still:
At the same time, smaller vendors without SOC 2 may still maintain strong security practices but simply haven’t reached the stage where pursuing an audit makes financial sense yet. SOC 2 audits can be expensive and time-consuming, especially for startups or smaller software companies.
These are great questions to ask, but keep in mind, you’re trusting the word of the vendor if they don’t have a SOC 2 audit to prove it.
SOC 2 should be viewed as:
One important signal — not the entire security story. Much like cyber insurance, SOC 2 requirements are where an organization should start, not stop, when it comes to security.
Most managed service provider software will mention SOC 2 prominently on:
You can also simply ask for a copy of their SOC 2 report during the evaluation process.
Typically:
If a vendor claims they’re SOC 2 compliant but refuses to provide additional details, that’s worth digging into further. And if they haven’t received their report yet but are actively in the audit process, they can provide a SOC 2 engagement letter.
You should also verify:
Sometimes only portions of a vendor’s infrastructure are covered.
Cybersecurity awareness training vendors handle sensitive user data, phishing simulations, and employee risk insights — which means security standards matter.
Phin has undergone a SOC 2 audit and is built specifically for MSPs looking for an easy-to-manage, set-it-and-forget-it security awareness training platform that grows with your MSP. That means whether you have 1 client or 100, the time spent onboarding and managing tenants stays roughly the same.
If you’re evaluating security awareness training vendors and want a platform designed with both usability and security in mind, learn more at phinsecurity.com.