SOC 1, 2, and 3 Reports

SOC 1, 2, and 3 Reports

Increasingly, businesses outsource basic functions such as data storage and access to applications to cloud service providers (CSPs) and other service organizations. In response, the American Institute of Certified Public Accountants (AICPA) has developed the Service Organization Controls (SOC) framework, a standard for controls that safeguard the confidentiality and privacy of information stored and processed in the cloud. This aligns with the International Standard on Assurance Engagements (ISAE), the reporting standard for international service organizations.

Service audits based on the SOC framework fall into two categories—SOC 1 and SOC 2—that apply to in-scope Microsoft cloud services.

A SOC 1 audit, intended for CPA firms that audit financial statements, evaluates the effectiveness of a CSP’s internal controls that affect the financial reports of a customer using the provider’s cloud services. The Statement on Standards for Attestation Engagements (SSAE 18) and the International Standards for Assurance Engagements No. 3402 (ISAE 3402) are the standards under which the audit is performed, and is the basis of the SOC 1 report.

A SOC 2 audit gauges the effectiveness of a CSP’s system based on the AICPA Trust Service Principles and Criteria. An Attest Engagement under Attestation Standards (AT) Section 101 is the basis of SOC 2 and SOC 3 reports.

At the conclusion of a SOC 1 or SOC 2 audit, the service auditor renders an opinion in a SOC 1 Type 2 or SOC 2 Type 2 report, which describes the CSP’s system and assesses the fairness of the CSP’s description of its controls. It also evaluates whether the CSP’s controls are designed appropriately, were in operation on a specified date, and were operating effectively over a specified time period.

Auditors can also create a SOC 3 report—an abbreviated version of the SOC 2 Type 2 audit report—for users who want assurance about the CSP’s controls but don’t need a full SOC 2 report. A SOC 3 report can be conferred only if the CSP has an unqualified audit opinion for SOC 2.

Microsoft covered cloud services are audited at least annually against the SOC reporting framework by independent third-party auditors. The audit for Microsoft cloud services covers controls for data security, availability, processing integrity, and confidentiality as applicable to in-scope trust principles for each service.

Microsoft has achieved SOC 1 Type 2, SOC 2 Type 2, and SOC 3 reports. In general, the availability of SOC 1 and SOC 2 reports is restricted to customers who have signed nondisclosure agreements with Microsoft; the SOC 3 report is publicly available.

Frequently asked questions

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With the reports, your auditors can compare Microsoft business cloud services results with your own legal and regulatory requirements.

  • You can see all SOC reports except those for Visual Studio Team Services through the Service Trust Platform.
  • Visual Studio Team Services customers who have signed non-disclosure agreements can email Team Services for its SOC 1 and SOC 2 reports. Note that this email is for Visual Studio Team Services only.

No. Microsoft shares the independent audit reports and certifications with customers so that they can verify Microsoft compliance with its security commitments.

Yes. When you migrate your applications and data to covered Microsoft cloud services, you can build on the audits and certifications that Microsoft holds. The independent reports attest to the effectiveness of controls that Microsoft has implemented to help maintain the security and privacy of your data.

The SOC Toolkit for Service Organizations is a helpful resource for understanding SOC reporting processes and promoting your organization’s use of them.

Microsoft in-scope cloud services

Covered services for SOC 1 and SOC 2 include:

  • Azure, Azure Government, and Azure Germany detailed list
  • Cloud App Security
  • Dynamics 365 and Dynamics 365 U.S. Government detailed list
  • Graph
  • Intune
  • Microsoft Flow cloud service either as a standalone service or as included in an Office 365 or Dynamics 365 branded plan or suite
  • Office 365, Office 365 U.S. Government, and Office 365 U.S. Government Defense detailed list; Yammer has achieved a SOC 1 Type 1 report
  • PowerApps cloud service either as a standalone service or as included in an Office 365 or Dynamics 365 branded plan or suite
  • Power BI cloud service either as a standalone service or as included in an Office 365 branded plan or suite
  • Visual Studio Team Services

Covered services for SOC 3 include:

  • Azure, Azure Government, and Azure Germany detailed list
  • Cloud App Security
  • Graph
  • Intune
  • Microsoft Flow cloud service either as a standalone service or as included in an Office 365 or Dynamics 365 branded plan or suite
  • PowerApps cloud service either as a standalone service or as included in an Office 365 or Dynamics 365 branded plan or suite
  • Power BI

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