Mark Agulnik partner with Marcum.
Many firms (i.e., user entities) outsource several functions, such as payroll processing, third-party administration of benefit plans, managed IT services and data centers. The growth in outsourcing combined with a more rigid regulatory environment has led more firms and their financial statement auditors to request System and Organization Controls (SOC) reports from external service providers. This trend will likely continue as businesses focus on core competencies while trying to emerge from the pandemic.
SOC reports can offer comfort to user entities and their auditors. Special contractual consideration when drafting an agreement between an organization and its vendors are essential, especially when the vendor is required to have a SOC report.
