SOC 2 Type 1 vs Type 2 Explained

If your company sells to enterprise or regulated customers, security due diligence is unavoidable. One of the most common requests you’ll face during procurement is a SOC 2 report, which provides independent assurance about how your organization protects customer data.

There are two types of SOC 2 reports: SOC 2 Type 1 and SOC 2 Type 2. While both are based on the same AICPA Trust Services Criteria (TSC), they differ significantly in scope, timing, cost, and buyer expectations.

In this guide, we’ll break down:

• What SOC 2 Type 1 and Type 2 actually mean
• Key differences between Type 1 vs Type 2
• Timelines and cost considerations
• When each report makes sense for your business
• How to decide which SOC 2 report you should pursue first

What Is SOC 2 Type 1?

A SOC 2 Type 1 report evaluates whether your security controls are designed appropriately at a specific point in time.

Think of Type 1 as a snapshot or photograph. An auditor reviews your systems, policies, and procedures as of a single date to confirm that required controls exist and are designed to meet SOC 2 requirements.

A Type 1 audit focuses on questions like:

• Do you have access controls in place?
• Are security policies documented and approved?
• Are logging, monitoring, and incident response processes defined?

Type 1 does not evaluate whether those controls are followed consistently over time.

Key Characteristics of SOC 2 Type 1

• Point-in-time assessment
• Focuses on control design, not effectiveness
• Faster to complete
• Lower audit cost

What Is SOC 2 Type 2?

A SOC 2 Type 2 report evaluates the operating effectiveness of your controls over a period of time, typically 3, 6, or 12 months.

Instead of asking whether controls exist, Type 2 asks whether they actually work in practice.

For example:

• Are terminated employees consistently removed from systems within your stated timeframe?
• Are security alerts reviewed and documented as required?
• Are changes approved and logged according to policy?

Because Type 2 audits test evidence collected over time, they are more rigorous, more time-consuming, and more expensive than Type 1 audits.

Key Characteristics of SOC 2 Type 2

• Time-based assessment (observation period)
• Focuses on operating effectiveness
• Higher buyer trust
• Required by most enterprise customers

SOC 2 Type 1 vs. Type 2: Key Differences

Category	SOC 2 Type 1	SOC 2 Type 2
Scope	Control design	Control effectiveness
Timeframe	Single point in time	3–12 month observation period
Cost	Lower	Higher
Buyer Acceptance	Limited	Widely accepted
Sales Impact	Short-term unblocker	Long-term enterprise readiness

Which SOC 2 Report Is Right for Your Business?

Both SOC 2 Type 1 and Type 2 require an audit by a licensed CPA firm. The difference comes down to urgency, customer expectations, and company maturity.

When a SOC 2 Type 1 Makes Sense

SOC 2 Type 1 is often a tactical step, not a final destination. Common scenarios where Type 1 is appropriate include:

• Unblocking early sales: Early-stage startups that need something credible to show security-conscious prospects
• Validating a new environment: Companies that recently rebuilt infrastructure and want fast third-party validation
• Preparing for Type 2: Teams that want a checkpoint before starting a longer observation period

However, many enterprise buyers treat Type 1 as temporary. It’s common to hear:

“This looks good. When does your Type 2 observation period start?”

If possible, Type 1 should be viewed as a stepping stone toward Type 2.

When You Should Go Directly to SOC 2 Type 2

For most companies selling into enterprise markets, SOC 2 Type 2 is the real requirement.

Buyers want assurance that your controls work consistently, not just that they exist on paper. A Type 2 report demonstrates operational maturity and reduces friction during security reviews.

Even if time is tight, many organizations opt for a shorter Type 2 observation period (e.g., 3 months) instead of a Type 1 report. This allows you to prove real-world effectiveness faster.

If your customers care deeply about security, going straight to Type 2 is often the strongest long-term decision.

The SOC 2 Audit Process: Step by Step

Whether you pursue Type 1 or Type 2, the preparation work is largely the same. The difference is how long you must operate controls before the audit.

Step 1: Readiness Assessment and Gap Analysis

Your current environment is mapped against the SOC 2 Trust Services Criteria you’ve selected (usually Security first). This identifies gaps such as missing policies, insufficient logging, or incomplete access controls.

Step 2: Implementation and Remediation

This is the most time-intensive phase. Teams implement technical controls, write policies, configure tooling (MDM, logging, monitoring), and set up evidence collection workflows.

Step 3: Observation Period (Type 2 Only)

For Type 2 audits, controls must operate consistently over a defined period (3–12 months). Evidence such as logs, tickets, and approvals is collected continuously.

Step 4: Formal Audit and Report

The auditor performs fieldwork and reviews documentation and evidence. Type 1 audits are typically faster, while Type 2 audits involve significantly more testing and sampling.

SOC 2 Timelines and Cost Considerations

The implementation effort for Type 1 and Type 2 is nearly identical. The difference lies in the audit duration and observation period.

Typical Timelines

• SOC 2 Type 1: 1–3 months end-to-end
• SOC 2 Type 2: 3–12 months depending on observation period

Cost Considerations

• Type 1 audits are cheaper due to limited auditor testing
• Type 2 audits cost more due to extended review and evidence validation

If you’ll need SOC 2 Type 2 shortly after Type 1, going directly to Type 2 can be more cost-effective over time.

Turning SOC 2 Into a Growth Advantage

Many companies treat SOC 2 as a checkbox or necessary evil. In reality, SOC 2 can accelerate sales, shorten procurement cycles, and build customer trust when done correctly.

The biggest challenge is internal time. SOC 2 preparation often pulls engineers and leaders away from core responsibilities to chase screenshots and documentation.

That’s why many fast-growing teams work with experienced compliance partners.

How Polimity Helps

Polimity helps high-growth companies achieve SOC 2 compliance without slowing down their teams. We provide hands-on guidance, implementation support, and audit readiness services from Type 1 through Type 2.

Our approach focuses on:

• Right-sized scoping to reduce audit cost
• Practical controls that satisfy auditors and buyers
• Faster paths to enterprise readiness

Build trust, accelerate growth, and get audit-ready with Polimity.