Why does the provider’s licensing and registration matter in a SOC audit?

Only firms registered as licensed CPA firms are authorised to issue SOC 1, SOC 2 or SOC 3 reports. A provider lacking these credentials may not adhere to the professional standards required for a meaningful audit.

What kind of timeline should organisations expect for a first-time SOC engagement?

A first-time SOC audit typically takes several months because of the readiness assessment, control documentation and testing phases. Promises of complete reports within three to six months may indicate a rushed, incomplete process.

What are the key audit procedures that signal a thorough SOC audit?

In addition to inquiry and inspection, a quality audit will include observation and reperformance of control operations, sampling throughout the audit period and review of evidence relating to operating effectiveness.

Why is it a problem if the audit report uses generic system and control descriptions?

If descriptions are generic or boiler-plate, the report may not reflect your actual control environment. This can undermine the confidence of your clients or regulators and reduce the value of the audit.

How should cost be weighed when choosing a SOC audit provider?

Cost should be only one factor. Low fees may mean shortcuts in procedures or weaker documentation. The value lies in a rigorous audit that supports reliable controls and client trust.

How can you assess whether a SOC provider is cutting corners?

Look for unusually short timelines, minimal documentation or reliance on generic wording. Ask about sample sizes, control testing methods and whether the report is tailored to your environment.

What makes a SOC audit report trustworthy for clients uploading their data to your cloud-based software?

Trustworthy reports come from a credible provider, use rigorous testing, reflect your actual control environment and provide clarity and transparency for your customers. A strong SOC report reassures clients about data protection, control design and operational effectiveness.

What should organisations do if they suspect their current SOC engagement was inadequate?

Start by reviewing the provider’s credentials, timeline promises, scope of audit procedures and the system/control descriptions used. If red flags exist, consider engaging a more rigorous provider to ensure your SOC report supports your business and client relationships.

Quality vs Price: 4 Red Flags When Choosing a SOC Provider

November 17, 2025November 17, 2025

PYA Insights

As third-party risk management requirements evolve, organizations increasingly face requests for System and Organization Controls (SOC) 1, SOC 2, or SOC 3 reports as a standard cost of doing business. Organizations searching for SOC service providers find a crowded marketplace offering fast audits at low fees. While these bargains may seem appealing, choosing a provider based solely on cost can lead to poor-quality, superficial, or inaccurate reports—creating headaches for the organization, eroding trust with clients, failing to identify critical control weaknesses, and even jeopardizing business relationships.

4 Red Flags When Choosing a SOC Provider

To avoid these pitfalls, PYA recommends watching for the following red flags when evaluating SOC service providers:

1. Qualifications of Service Providers

Only licensed and registered CPA firms are authorized to perform SOC audits and issue SOC 1, SOC 2, and SOC 3 reports. Be cautious of firms that lack these credentials.

2. Unrealistic Timelines for New Reports

First-time SOC audits require a thorough readiness assessment to identify gaps, document internal controls, and develop a detailed system description. This process often takes several months. Providers promising readiness assessments and full audit reports within as little as 3-6 months may be cutting corners.

3. Limited Audit Procedures

SOC reports include formal audit opinions, which require rigorous testing. High-quality audits blend inquiry, observation, inspection, and reperformance. For Type II reports, testing must cover samples throughout the audit period to validate operating effectiveness. Beware of proposals that rely primarily on inquiry.

4. Generic System and Control Descriptions

SOC reports should reflect your organization’s actual control environment—not use boilerplate language. If a provider encourages generic controls or vague system descriptions, the report may fail to meet client expectations and the standards governing these audits.

Build Trust with Quality SOC Reports

PYA works closely with clients to deliver comprehensive SOC audits and the related reports that inspire confidence, build trust, and demonstrate reliable internal controls. If you have concerns about your current SOC services or want to learn more about how PYA can support your SOC requirements, our experts are happy to assist.