Compliance reporting is the formalized process of documenting an organization’s compliance posture within the scope of applicable regulatory standards and frameworks. It can be an internal or external requirement, with the aim to systematically establish if your business and administrative processes display the integrity required for the regulation in question.
Compliance reporting is particularly important for organizations striving to comply with numerous regulations simultaneously. Quality reports not only satisfy auditors but also offer decision-making clarity to other stakeholders like customers and risk leaders.
Our guide will answer some of the most pressing questions in this space, including:
- What is a compliance report, and what are its types?
- What are the contents of the report?
- Which steps should you take within the compliance reporting process?
What is a compliance report?
A compliance report is a document that demonstrates an organization’s adherence to relevant corporate or regulatory standards and guidelines. It is typically maintained and submitted as part of the evidence used by auditors to check the extent and quality of compliance status.
Depending on factors like the purpose and scope of your GRC program, you can have four main types of compliance reports:
- Regulatory: Proves a company’s compliance with external laws and regulations, such as GDPR and HIPAA.
- Financial: Reflects an organization’s adherence to specific financial regulations (e.g., the Sarbanes-Oxley Act).
- Operational: Communicates the ability to follow the established internal policies and external requirements to prevent operational errors.
- IT: Demonstrates an organization’s security compliance posture, usually through adherence to applicable standards (e.g., ISO 27001).
Which organizations require compliance reporting?
Most organizations adopt compliance reporting for internal use or while pursuing certifications for standards, whether voluntary or not.
For example, if your business processes or stores customer data, you should ensure SOC 2 compliance and follow related reporting protocols. While the standard is voluntary, it’s widely accepted as a means of proving your commitment to data security and privacy to customers.
Some industries require mandatory compliance and stricter reporting requirements — a good example is HIPAA, which requires all organizations that process protected health information (PHI) to implement security measures, establish relevant policies, and file specific incident reports.
Benefits of effective compliance reporting
An effective reporting culture is the backbone of any compliance management program. Depending on the standards applicable in your industry, non-reporting or under-reporting can cause significant issues, ranging from operational inefficiencies and penalties to business disruption or even closure.
Here are some specific benefits of establishing an effective compliance reporting process:
- Proven adherence to the necessary regulations: It’s not enough for the management to know an organization is compliant with the relevant standards. Compliance reporting helps you demonstrate your commitment to responsible operations to customers and investors, and improve business reputation in the process.
- Faster compliance budget approvals: According to the 2023 Global Compliance Risk Benchmarking survey, many organizations desire higher compliance budgets. However, it’s not easy to connect compliance to revenue, which may delay budget approvals. That’s why many risk managers use the metrics in their compliance reports to offer leaders clarity about the ROI generated from investment in compliance.
- Smooth audit workflows: A well-developed reporting process should streamline compliance audits to help you conduct them more effortlessly.
- Risk mitigation: Ongoing reporting uncovers any privacy, cybersecurity, and third-party risks that might harm your organization, helping you take corrective action proactively.
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What does a compliance report consist of?
The exact structure and contents of your compliance report can vary according to the specific framework or standard you’re adhering to. Still, you can check out the following five general components most reports include:
- Scope: Outlines everything that’s been reviewed against specific standards or regulations (people, processes, systems, etc.) and may also explicitly mention what hasn’t been reviewed.
- Process review: Covers the specific steps that went into making the report, such as:some text
- Examining risk assessment methodologies
- Establishing protocols
- Implementing controls and tests
- Report summary: Presents a concise overview of key findings under headers like results of control tests, areas for improvement, and general compliance posture, all backed with necessary data.
- Next steps: Solidifies the key measures and processes you’ll implement to bridge any gaps between your current and future/desired compliance standing.
- Annexures (if any): Includes additional documents, such as graphs and references, that complement the report.
Five steps to effective compliance reporting
Effective compliance reporting requires organization-level alignment of workflows with relevant stakeholders. The following five steps can guide you through the process:
- Prepare the logistics.
- Gather the necessary data and documentation.
- Turn data into comparable insights.
- Compile the report and share it with stakeholders.
- Monitor and revise.
Step 1: Prepare the logistics
Planning your reporting process is crucial to creating a streamlined workflow in the future. It ensures that you don’t need to make any disruptive changes in the later stages.
Start by familiarizing yourself with the applicable standards and regulations, as they will inform the data you need to include in your report. Ideally, you should bring your compliance team together to brainstorm the following:
- Task owners: Assign roles and responsibilities when it comes to evidence collection, updating documents, and similar tasks.
- Recipients: The report’s target audience can make a lot of difference to the specific data collection and analysis measures. For instance, internal compliance reports might not require the same data you need to present to an external auditor.
- Reporting frequency: Reporting should be an ongoing process to enable continuous compliance, so you should define the cadence at which specific tasks will occur (e.g., periodic risk assessments, process reviews, etc.).
By the end of the first step, you should have a clear overview of three components:
- The report’s purpose
- General reporting steps
- A chain of accountability for reporting workflows
Step 2: Gather the necessary data and documentation
Data gathering is an important enabler in the compliance reporting process. Set up a process to collect enough data for reporting by:
- Interviewing people throughout the organization
- Tapping into your databases to gather evidence
- Reviewing relevant processes and systems
The complexity of data collection is often exacerbated by the disparate systems many organizations use to facilitate compliance. Teams often dig through countless email chains, screenshots, and spreadsheets to compile all material data for reporting, which wastes a lot of time and energy.
The best practice for efficiency is to implement a streamlined (preferably automated) compliance management system. You can get a software solution to consolidate data sources into a single hub, making critical data readily available to compliance teams. Many systems also integrate compliance risk management processes, helping you create reports with additional data on threats and vulnerabilities relevant to your compliance posture.
Step 3: Turn data into comparable insights
After all the necessary data has been collected, you need to turn it into insights you can use to compare your current compliance standing against the corresponding requirements. The end result of this process should be sufficient clarity in the following three areas:
- Full compliance
- Partial compliance
- Non-compliance
If you’re yet to achieve full compliance, use the available insights to outline and prioritize the tasks you should complete to meet compliance before the next reporting cycle.
Step 4: Compile the report and share it with stakeholders
When you have all the relevant data and insights at your disposal, start drafting your compliance report with the target recipients and stakeholders in mind.
For example, if you’re preparing the report for external auditors, you need to document all the key processes and highlight subject matter experts, as the auditors might want to interview them. The same goes for evidence — make sure to have copies of your internal documentation regarding the following:
- Procedures and policies
- Testing reports
- Risk assessment reports
If you’re drafting the report for an internal team, focus more on the recipient’s decision-making needs. You may want to include details about the status of controls, identified vulnerabilities, and the overall cost of compliance.
After the report is complete, share it with stakeholders who will need to sign it off. This can include the chief compliance officer (CCO) and/or someone from upper management or the legal team.
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Step 5: Monitor and revise
The compliance reporting process isn’t finished once you’ve compiled the report. Ideally, your report will pave the way for various actions, which need to be closely monitored to ensure you’re moving toward full compliance.
You’ll also need to keep track of various internal updates, as well as any changes to the applicable regulations and standards that call for a revision of future reporting processes.
The biggest challenge with traditional compliance reporting and monitoring cycles is that their granular processes can get lengthy and tiring to sustain. Even the best compliance teams may find themselves struggling to make sense of scattered data and compile stakeholder-optimized reports.
To minimize the time and effort necessary for compliance reporting, it’s best to adopt a software that supports real-time compliance monitoring and automated reporting. Many tools also help with automating evidence collection and tracking reporting due dates, ensuring you maintain compliance.
Automate compliance reporting with Vanta
Vanta is a comprehensive compliance automation solution that removes manual work for up to 90% of your compliance tasks, including evidence collection and reporting, at any scale. It does this through numerous useful features, such as:
- Pre-mapping of documents/evidence collection across security frameworks like:some text
- Automated questionnaires, checks, and controls boosted by Vanta AI
- Live inventory management and compliance status
- Framework-specific as well as custom compliance reports, security policies, etc.
- Alerts tied to your compliance controls
With Vanta, you don’t need to rely on inefficient processes to assess, report on, and improve upon your compliance program. Access all key data from a unified hub and use over 300 integrations to verify compliance controls with other systems.
Should you ever fall out of compliance, use Vanta’s built-in automated tests and remediation workflows to get back on track. You can also leverage the dedicated Audit Page to manage your compliance and audit reports from one place.
If you want to replace your manual processes or legacy software with a far more streamlined option, explore Vanta’s GRC solution.
You can also schedule a custom demo to see Vanta and its many features in action.
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Compliance
What is compliance reporting? A detailed guide with steps to the reporting process
Compliance
Compliance reporting is the formalized process of documenting an organization’s compliance posture within the scope of applicable regulatory standards and frameworks. It can be an internal or external requirement, with the aim to systematically establish if your business and administrative processes display the integrity required for the regulation in question.
Compliance reporting is particularly important for organizations striving to comply with numerous regulations simultaneously. Quality reports not only satisfy auditors but also offer decision-making clarity to other stakeholders like customers and risk leaders.
Our guide will answer some of the most pressing questions in this space, including:
- What is a compliance report, and what are its types?
- What are the contents of the report?
- Which steps should you take within the compliance reporting process?
What is a compliance report?
A compliance report is a document that demonstrates an organization’s adherence to relevant corporate or regulatory standards and guidelines. It is typically maintained and submitted as part of the evidence used by auditors to check the extent and quality of compliance status.
Depending on factors like the purpose and scope of your GRC program, you can have four main types of compliance reports:
- Regulatory: Proves a company’s compliance with external laws and regulations, such as GDPR and HIPAA.
- Financial: Reflects an organization’s adherence to specific financial regulations (e.g., the Sarbanes-Oxley Act).
- Operational: Communicates the ability to follow the established internal policies and external requirements to prevent operational errors.
- IT: Demonstrates an organization’s security compliance posture, usually through adherence to applicable standards (e.g., ISO 27001).
Which organizations require compliance reporting?
Most organizations adopt compliance reporting for internal use or while pursuing certifications for standards, whether voluntary or not.
For example, if your business processes or stores customer data, you should ensure SOC 2 compliance and follow related reporting protocols. While the standard is voluntary, it’s widely accepted as a means of proving your commitment to data security and privacy to customers.
Some industries require mandatory compliance and stricter reporting requirements — a good example is HIPAA, which requires all organizations that process protected health information (PHI) to implement security measures, establish relevant policies, and file specific incident reports.
Benefits of effective compliance reporting
An effective reporting culture is the backbone of any compliance management program. Depending on the standards applicable in your industry, non-reporting or under-reporting can cause significant issues, ranging from operational inefficiencies and penalties to business disruption or even closure.
Here are some specific benefits of establishing an effective compliance reporting process:
- Proven adherence to the necessary regulations: It’s not enough for the management to know an organization is compliant with the relevant standards. Compliance reporting helps you demonstrate your commitment to responsible operations to customers and investors, and improve business reputation in the process.
- Faster compliance budget approvals: According to the 2023 Global Compliance Risk Benchmarking survey, many organizations desire higher compliance budgets. However, it’s not easy to connect compliance to revenue, which may delay budget approvals. That’s why many risk managers use the metrics in their compliance reports to offer leaders clarity about the ROI generated from investment in compliance.
- Smooth audit workflows: A well-developed reporting process should streamline compliance audits to help you conduct them more effortlessly.
- Risk mitigation: Ongoing reporting uncovers any privacy, cybersecurity, and third-party risks that might harm your organization, helping you take corrective action proactively.
{{cta_withimage3="/cta-modules"}}
What does a compliance report consist of?
The exact structure and contents of your compliance report can vary according to the specific framework or standard you’re adhering to. Still, you can check out the following five general components most reports include:
- Scope: Outlines everything that’s been reviewed against specific standards or regulations (people, processes, systems, etc.) and may also explicitly mention what hasn’t been reviewed.
- Process review: Covers the specific steps that went into making the report, such as:some text
- Examining risk assessment methodologies
- Establishing protocols
- Implementing controls and tests
- Report summary: Presents a concise overview of key findings under headers like results of control tests, areas for improvement, and general compliance posture, all backed with necessary data.
- Next steps: Solidifies the key measures and processes you’ll implement to bridge any gaps between your current and future/desired compliance standing.
- Annexures (if any): Includes additional documents, such as graphs and references, that complement the report.
Five steps to effective compliance reporting
Effective compliance reporting requires organization-level alignment of workflows with relevant stakeholders. The following five steps can guide you through the process:
- Prepare the logistics.
- Gather the necessary data and documentation.
- Turn data into comparable insights.
- Compile the report and share it with stakeholders.
- Monitor and revise.
Step 1: Prepare the logistics
Planning your reporting process is crucial to creating a streamlined workflow in the future. It ensures that you don’t need to make any disruptive changes in the later stages.
Start by familiarizing yourself with the applicable standards and regulations, as they will inform the data you need to include in your report. Ideally, you should bring your compliance team together to brainstorm the following:
- Task owners: Assign roles and responsibilities when it comes to evidence collection, updating documents, and similar tasks.
- Recipients: The report’s target audience can make a lot of difference to the specific data collection and analysis measures. For instance, internal compliance reports might not require the same data you need to present to an external auditor.
- Reporting frequency: Reporting should be an ongoing process to enable continuous compliance, so you should define the cadence at which specific tasks will occur (e.g., periodic risk assessments, process reviews, etc.).
By the end of the first step, you should have a clear overview of three components:
- The report’s purpose
- General reporting steps
- A chain of accountability for reporting workflows
Step 2: Gather the necessary data and documentation
Data gathering is an important enabler in the compliance reporting process. Set up a process to collect enough data for reporting by:
- Interviewing people throughout the organization
- Tapping into your databases to gather evidence
- Reviewing relevant processes and systems
The complexity of data collection is often exacerbated by the disparate systems many organizations use to facilitate compliance. Teams often dig through countless email chains, screenshots, and spreadsheets to compile all material data for reporting, which wastes a lot of time and energy.
The best practice for efficiency is to implement a streamlined (preferably automated) compliance management system. You can get a software solution to consolidate data sources into a single hub, making critical data readily available to compliance teams. Many systems also integrate compliance risk management processes, helping you create reports with additional data on threats and vulnerabilities relevant to your compliance posture.
Step 3: Turn data into comparable insights
After all the necessary data has been collected, you need to turn it into insights you can use to compare your current compliance standing against the corresponding requirements. The end result of this process should be sufficient clarity in the following three areas:
- Full compliance
- Partial compliance
- Non-compliance
If you’re yet to achieve full compliance, use the available insights to outline and prioritize the tasks you should complete to meet compliance before the next reporting cycle.
Step 4: Compile the report and share it with stakeholders
When you have all the relevant data and insights at your disposal, start drafting your compliance report with the target recipients and stakeholders in mind.
For example, if you’re preparing the report for external auditors, you need to document all the key processes and highlight subject matter experts, as the auditors might want to interview them. The same goes for evidence — make sure to have copies of your internal documentation regarding the following:
- Procedures and policies
- Testing reports
- Risk assessment reports
If you’re drafting the report for an internal team, focus more on the recipient’s decision-making needs. You may want to include details about the status of controls, identified vulnerabilities, and the overall cost of compliance.
After the report is complete, share it with stakeholders who will need to sign it off. This can include the chief compliance officer (CCO) and/or someone from upper management or the legal team.
{{cta_simple1}}
Step 5: Monitor and revise
The compliance reporting process isn’t finished once you’ve compiled the report. Ideally, your report will pave the way for various actions, which need to be closely monitored to ensure you’re moving toward full compliance.
You’ll also need to keep track of various internal updates, as well as any changes to the applicable regulations and standards that call for a revision of future reporting processes.
The biggest challenge with traditional compliance reporting and monitoring cycles is that their granular processes can get lengthy and tiring to sustain. Even the best compliance teams may find themselves struggling to make sense of scattered data and compile stakeholder-optimized reports.
To minimize the time and effort necessary for compliance reporting, it’s best to adopt a software that supports real-time compliance monitoring and automated reporting. Many tools also help with automating evidence collection and tracking reporting due dates, ensuring you maintain compliance.
Automate compliance reporting with Vanta
Vanta is a comprehensive compliance automation solution that removes manual work for up to 90% of your compliance tasks, including evidence collection and reporting, at any scale. It does this through numerous useful features, such as:
- Pre-mapping of documents/evidence collection across security frameworks like:some text
- Automated questionnaires, checks, and controls boosted by Vanta AI
- Live inventory management and compliance status
- Framework-specific as well as custom compliance reports, security policies, etc.
- Alerts tied to your compliance controls
With Vanta, you don’t need to rely on inefficient processes to assess, report on, and improve upon your compliance program. Access all key data from a unified hub and use over 300 integrations to verify compliance controls with other systems.
Should you ever fall out of compliance, use Vanta’s built-in automated tests and remediation workflows to get back on track. You can also leverage the dedicated Audit Page to manage your compliance and audit reports from one place.
If you want to replace your manual processes or legacy software with a far more streamlined option, explore Vanta’s GRC solution.
You can also schedule a custom demo to see Vanta and its many features in action.
{{cta_testimonial1="/cta-modules"}}
Webinar: Scaling your GRC program with automation and AI
Learn how to automate compliance processes, strategies to streamline risk assessments and ways to use automation and AI on vendor security reviews.
Webinar: Scaling your GRC program with automation and AI
Learn how to automate compliance processes, strategies to streamline risk assessments and ways to use automation and AI on vendor security reviews.
Webinar: Scaling your GRC program with automation and AI
Learn how to automate compliance processes, strategies to streamline risk assessments and ways to use automation and AI on vendor security reviews.
| Role: | GRC responsibilities: |
|---|---|
| Board of directors | Central to the overarching GRC strategy, this group sets the direction for the compliance strategy. They determine which standards and regulations are necessary for compliance and align the GRC strategy with business objectives. |
| Chief financial officer | Primary responsibility for the success of the GRC program and for reporting results to the board. |
| Operations managers from relevant departments | This group owns processes. They are responsible for the success and direction of risk management and compliance within their departments. |
| Representatives from relevant departments | These are the activity owners. These team members are responsible for carrying out specific compliance and risk management tasks within their departments and for integrating these tasks into their workflows. |
| Contract managers from relevant department | These team members are responsible for managing interactions with vendors and other third parties in their department to ensure all risk management and compliance measures are being taken. |
| Chief information security officer (CISO) | Defines the organization’s information security policy, designs risk and vulnerability assessments, and develops information security policies. |
| Data protection officer (DPO) or legal counsel | Develops goals for data privacy based on legal regulations and other compliance needs, designs and implements privacy policies and practices, and assesses these practices for effectiveness. |
| GRC lead | Responsible for overseeing the execution of the GRC program in collaboration with the executive team as well as maintaining the organization’s library of security controls. |
| Cybersecurity analyst(s) | Implements and monitors cybersecurity measures that are in line with the GRC program and business objectives. |
| Compliance analyst(s) | Monitors the organization’s compliance with all regulations and standards necessary, identifies any compliance gaps, and works to mitigate them. |
| Risk analyst(s) | Carries out the risk management program for the organization and serves as a resource for risk management across various departments, including identifying, mitigating, and monitoring risks. |
| IT security specialist(s) | Implements security controls within the IT system in coordination with the cybersecurity analyst(s). |
Explore more GRC articles
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Optimizing a GRC program
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Risk
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