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Difficulty: MediumSecurity Audits, Assessments, and Attestations

A healthcare organization is reviewing third-party compliance documentation for a cloud-based medical billing platform. The compliance team specifically requires independent verification that the vendor's internal controls over financial reporting (ICFR) operating within the platform are effectively designed and operating as intended over time. Which of the following audit reports should the organization request to satisfy this requirement?

  1. SOC 1 Type II reportAnswer
  2. B
    SOC 2 Type II report
  3. C
    SOC 3 report
  4. D
    External vulnerability assessment report

Answer

SOC 1 Type II report
The SOC 1 Type II report is specifically designed to assess a third-party service provider's controls that are relevant to a user entity's internal control over financial reporting (ICFR). The Type II designation confirms that an independent auditor evaluated both the suitability of the control design and its operating effectiveness over a specified testing window.

Step-by-Step Solution

1
Analyze the compliance requirement scope
The scenario requires evaluation of internal controls over financial reporting (ICFR).
Distinguishing financial reporting controls from general cybersecurity criteria determines the appropriate audit standard.
2
Select the correct SOC report category
SOC 1 reports (SSAE 18) are specifically designated for service organization controls impacting financial reporting.
SOC 2 and SOC 3 focus on operational security trust criteria rather than financial accounting controls.
3
Determine the required report depth
A Type II report validates both design suitability and operating effectiveness over a period of time.
The scenario specifically demands proof that controls operated effectively over time.

Key Concept

SOC 1 vs SOC 2 Scope and Attestation Types
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Topics

Security Audits, Assessments, and Attestations

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