Service Organization Controls (SOC)

SOC 1, 2, and 3 Reports overview

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 and SOC 1, 2, and 3 Reports

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.

Microsoft in-scope cloud services

Covered services for SOC 1 and SOC 2

Covered services for SOC 3

Audits, reports, and certificates

Audit cycle

Microsoft cloud services are audited at least annually against SOC 1 (SSAE18, ISAE 3402), SOC 2 (AT Section 101), and SOC 3 standards.

Azure, Dynamics 365, Microsoft Cloud App Security, Flow, Microsoft Graph, Intune, Power BI, PowerApps, Microsoft Stream, and Microsoft Datacenters

Office 365

Frequently asked questions

How can I get copies of the SOC reports?

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

How often are Azure SOC reports issued?

SOC reports for Azure, Microsoft Cloud App Security, Flow, Microsoft Graph, Intune, Power BI, PowerApps, Microsoft Stream, and Microsoft Datacenters are based on a rolling 12-month run window (audit period) with new reports issued semi-annually (period ends are March 31 and September 30). Bridge letters are issued each quarter to cover the prior three month period. For example, the January letter covers 10/1-12/31, the April letter covers 1/1-3/31, the July letter covers 4/1-6/30, and the October letter covers 7/1-9/30. Customers can download the latest reports from the Service Trust Portal.

Do I need to conduct my own audit of Microsoft datacenters?

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

Can I use Microsoft's compliance in my organization's certification process?

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.

Where do I start with my organization's own compliance effort?

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

Use Microsoft Compliance Manager to assess your risk

Microsoft Compliance Manager is a feature in the Microsoft 365 compliance center to help you understand your organization's compliance posture and take actions to help reduce risks. Compliance Manager offers a premium template for building an assessment for this regulation. Find the template in the assessment templates page in Compliance Manager. Learn how to build assessments in Compliance Manager.

Resources