Start with what could go wrong in the work customers rely on for financial reporting. Then describe the outcome your controls need to support. Do not begin by copying a list of security tools.
A control objective says what the controls are meant to achieve. The controls explain how you work toward that outcome. Evidence shows what actually happened.
Keep the financial-reporting connection clear
SOC 1 concerns controls relevant to customers’ internal control over financial reporting. It is not a general certificate for every part of your business. Your objectives need to fit the service covered by the report.
Ask the service owner to explain how customers use your output. For example:
- Does a payroll report feed their wage expense records?
- Does a transaction file feed their billing or accounting system?
- Does your service maintain balances they use in their financial statements?
If nobody can explain the connection, pause before adding an objective. Work through the service and its reporting purpose with the CPA firm.
Follow one transaction before writing the objective
Choose an ordinary transaction and trace it through the service. Use the real process rather than an idealized flowchart.
- Where does the instruction come from?
- Who may authorize it?
- What happens during processing?
- How are rejected or incomplete items handled?
- What output goes to the customer?
- What does the customer still need to check?
Write down the mistakes that could matter at each stage. Missing records and duplicate processing are different problems. An accurate calculation based on an unauthorized change can still produce the wrong result.
A simple worked example
Suppose a service imports customer sales records into an accounting platform. The following is a drafting example, not approved wording for every engagement:
- Risk: Some accepted records are omitted or imported twice.
- Objective: Controls provide reasonable assurance that accepted sales records are transferred completely and without duplication.
- Control: The operator reconciles accepted records to import results and investigates differences before releasing the batch.
- Evidence: The batch reference, reconciliation and recorded resolution of differences.
Now challenge the example. Does the process identify a retry that created duplicate entries? Does it distinguish rejected records from accepted ones? Who checks unresolved differences? A neat sentence is not enough if the process cannot answer those questions.
This example addresses transfer completeness and duplication. It does not establish that sales were valid or correctly priced. Those issues need separate consideration if relevant to the service.
Do not confuse an objective with a task
“A supervisor reviews the import report each morning” describes an activity. It does not explain what the review is intended to achieve.
Keep the outcome and the procedure separate. Then make the procedure specific enough for someone to perform it. Name the owner and explain what they compare. Say how they handle a difference and where the result is recorded.
One objective may need several controls. One control may support more than one objective. Avoid creating a new objective for every ticket or configuration setting.
Include dependencies rather than hiding them
Be clear about the work your company performs and the checks left to customers or providers. A customer’s approval may be essential to the process. Do not describe that approval as something your team performs if it does not.
Supporting IT controls may matter too. For the import example, ask who can change the transfer logic or edit records outside the normal process. A reliable reconciliation can be undermined by an uncontrolled system change.
Review the set, not just each sentence
Management owns its responsibilities. The auditor evaluates whether the stated objectives are reasonable in the circumstances. A report may not address every individual customer’s needs.
Before settling the draft, ask:
- Does each objective address a relevant risk?
- Are important parts of the service missing?
- Do the listed controls actually support the outcome?
- Can the owners explain the work and produce records?
- Are customer and provider responsibilities clear?
Discuss gaps with the CPA firm before relying on the list for an examination. Do not weaken an objective simply because the existing controls fall short.
For the full operating context, see our small payroll provider guide and outsourced bookkeeping guide.
Source: AICPA AT-C section 320 defines control objectives in .08 and addresses their evaluation in .25 and .A39. The example above is practical drafting guidance, not a universal list of SOC 1 objectives.