SOC 1 Type 2 Report: Which Section Helps You Understand a Service Organization?

The correct answer is C Summary of significant deficiencies.

Here's why:

• Summary of significant deficiencies highlights control weaknesses discovered during the audit period. This section is critical for understanding potential risks associated with the service organization's operations.

Let's look at the other options:

• A Management’s assertion. This section outlines the service organization's management's claims about their controls' effectiveness. While important, it doesn't directly provide an independent view of potential weaknesses.* B Financial statements. Financial statements are not typically included in a SOC 1 report. SOC 1 focuses on controls relevant to financial reporting, not the financial results themselves.* D Industry analyst’s report. An industry analyst's report is an external document and not part of a SOC 1 report.

In conclusion: When looking to understand a service organization's control environment and potential weaknesses, focus on the 'Summary of significant deficiencies' section within a SOC 1 Type 2 report. This section offers valuable insights from an independent auditor's perspective.