Businesses are increasingly reliant on technology to achieve organizational objectives. However, with the convenience and efficiency of technology come intensifying risks of data loss and theft. High-profile data breaches top news headlines daily. Protecting your organization’s electronic assets from theft is an utmost priority.
Cybersecurity deficiencies can expose organizations to irreparable reputational damage. Evaluating your organization’s cybersecurity risks and controls is paramount. Until recently, however, there was not a unified framework that allowed organizations to communicate with stakeholders in a common and concise language about the extent and effectiveness of controls in place to mitigate cybersecurity risk.
To offer a solution to this issue, the AICPA developed a cybersecurity risk management reporting framework. The framework is an essential component of the System and Organization (SOC) for Cybersecurity engagement. This engagement allows certified public accountants (CPAs) to issue an opinion on the effectiveness of the organization’s cybersecurity controls and threat mitigation.
For those familiar with Service Organization Control reports already issued by CPAs, the fundamentals are the same: a qualified CPA reports on the accuracy of management’s description and evaluates the effectiveness of management’s controls over cybersecurity risk. The key difference, however, is that these reports are not limited to service organizations. In fact, the AICPA renamed the reporting method so that the “S” in SOC now stands for “System” instead of “Service.” This change broadens the scope of the report to cover any industry and organization that would find itself at risk from cyber threats.
An additional benefit of the cybersecurity risk management reporting framework is that it is flexible, yet consistent. This advantage allows the framework to seamlessly complement existing cybersecurity risk management frameworks. Management can encourage organizations to use the framework to evaluate their own programs and standardize assessment of their cybersecurity control environment. Once management has established a thorough system of controls to mitigate cybersecurity risk, a qualified CPA may attest to management’s control description, as well as the design and operating effectiveness of the controls.
CPAs can provide both advisory and attestation engagements related to cybersecurity frameworks. Advisory engagements are designed to help clients strengthen their cybersecurity control programs, while attestation engagements provide an opinion on the entity’s description and effectiveness of controls.
Lastly, organization stakeholders benefit from having their financial and reputational interests secured, thereby increasing confidence in an organization’s due diligence to proactively address and reduce risks from both external and internal cyber threats.
PYA has released a white paper that discusses the importance of the AICPA’s cybersecurity risk management framework and SOC for Cybersecurity in assessing the strength and effectiveness of cybersecurity risk management programs. Download the white paper here.
If you would like more information about SOCs for cybersecurity, or would like to request a speaker for your organization or event, contact one of our PYA executives below at (800) 270-9629.