Third-party assurance optimization

Increased demand for third-party assurance reports

With more companies leveraging outsourcing as an integral driver for growth, the significance of TPA compliance continues to rise . And outsourcing has expanded the universe of risks, which now encompasses risks ranging from financial and operational to cyber and business continuity to sustainability risk. More than ever, companies are holding OSPs to the same level of risk monitoring and regulatory compliance that they hold themselves. As a result, demand for third-party assurance reports has skyrocketed. Annual service auditor reports reviewed by Deloitte reveal an increase of around 12 percent in the total number of reports annually.

Easing the burden

Increased regulation and greater reliance on outsourcing have led to a proliferation of third-party assurance reports, from the workhorse SOC 1 reports to Attestation (ATC-205), SOC 2, and Agreed-Upon Procedures (AUP) reports. In addition, a wide range of industry-specific reports have been issued, and TPA reports will likely extend to other business-critical areas such as cybersecurity.

OSPs are also often inundated with security questionnaires from individual clients, requests for customer-specific third-party assurance reports, and demands to arrange for burdensome on-site client auditor visits that well-designed TPA programs should address. Combine this with the need for OSPs to meet their own internal compliance requirements, and it’s easy to see why they are looking for ways to ease the burden.