The entity implements policies and procedures over system inputs to provide reasonable assurance

To meet the entity implements policies and procedures over system inputs to provide reasonable assurance requirement (SOC 2 TSC-PI1.2), you must control how data enters in-scope systems so inputs are authorized, complete, accurate, and traceable. Operationalize this by inventorying input channels, defining validation and approval rules, implementing technical checks, and retaining repeatable evidence that controls ran.

Key takeaways:

• Treat “system inputs” as every path data can enter your processing environment, including APIs, UIs, batch jobs, imports, and admin tools.
• Auditors test both design and operation: documented procedures plus logs, tickets, and samples showing validation and exception handling.
• The fastest path is an input inventory → control mapping → validation + reconciliation → monitoring + evidence pack.

TSC-PI1.2 sits in SOC 2 Processing Integrity and focuses on a narrow but high-impact risk: bad inputs create bad outputs. If your organization processes customer data, financial transactions, usage events, or compliance-relevant records, examiners will expect you to show that inputs are controlled from end to end. That means you can explain (and prove) how data gets into each in-scope system, what checks prevent incomplete or unauthorized submissions, how errors are detected and corrected, and how you keep an audit trail.

For most service organizations, “system inputs” is broader than teams first assume. It includes customer-submitted forms, internal admin portals, APIs, file uploads (SFTP/CSV), ETL/ELT pipelines, webhooks, message queues, and manual data entry. It also includes configuration and reference data that changes how processing happens, like pricing tables, entitlement rules, or tax settings.

Your goal is reasonable assurance, not perfection. Build a practical control set that reduces the likelihood and impact of incorrect processing, and make it easy to produce evidence on demand. This page gives you requirement-level steps, artifacts to retain, common audit hangups, and a 30/60/90 plan.

Regulatory text

SOC 2 Trust Services Criteria (Processing Integrity), TSC-PI1.2: “The entity implements policies and procedures over system inputs to provide reasonable assurance.” ¹

Operator meaning: You need documented, operating controls over data entry so that only approved inputs enter processing, inputs are validated for correctness and completeness, exceptions are handled, and changes are traceable. Auditors will look for (1) defined procedures and (2) evidence that the procedures work in practice for each material input path.

Plain-English interpretation (what “reasonable assurance” looks like)

You satisfy this requirement when you can answer, consistently and with evidence:

1. What are our input channels? You have a complete list of ways data enters in-scope systems.
2. Who/what is allowed to submit inputs? You enforce authentication, authorization, and segregation where needed.
3. What checks run before processing? You validate required fields, formats, ranges, referential integrity, and duplicates.
4. How do we detect missing or dropped inputs? You reconcile counts, totals, sequence numbers, or completeness indicators.
5. What happens when an input fails? You log the error, stop or quarantine bad data, route for review, and track remediation.
6. Can we prove it later? You retain logs, configuration, tickets, and samples that show the controls operated.

Who it applies to (entity and operational context)

This requirement typically applies to service organizations undergoing a SOC 2 examination where Processing Integrity is in scope ¹. In practice, it applies to:

• Product/SaaS platforms ingesting customer data, events, files, or transactions
• Data processors running ETL/ELT pipelines, enrichment, scoring, or reporting
• Payments/billing and revenue systems where incorrect inputs affect invoices, credits, or ledger postings
• Workflow and case management systems where intake drives downstream actions
• Admin-operated systems where internal users can create, edit, or import customer-impacting records

If your SOC 2 scope includes only a subset of systems, limit input controls to those systems and their upstream feeders. Document the boundary clearly so you are not defending controls for out-of-scope tools.

What you actually need to do (step-by-step)

Step 1: Build a system input inventory (don’t start with policies)

Create a table that lists every input path into each in-scope system.

Minimum fields to capture

• System name (in scope)
• Input channel (API endpoint, UI form, CSV import, webhook, queue topic, admin tool)
• Input type (transaction, profile update, event, configuration/reference data)
• Source (customer, third party, internal service, employee/admin)
• Authentication method (SSO, API key, OAuth, mTLS, none)
• Key validations (required fields, format checks, schema validation, business rules)
• Failure handling (reject, quarantine, retry, manual review)
• Logging/audit trail location
• Control owner

Practical tip: Most audit issues come from “unknown inputs” such as backfill scripts, one-off imports, support-admin edits, and partner feeds. Include them.

Step 2: Classify inputs by risk and materiality

Not every input needs the same rigor. Classify each input path into tiers such as:

• Tier 1 (material): directly affects customer outcomes, billing, payouts, compliance reporting, or contractual SLAs.
• Tier 2 (operational): affects internal metrics or non-customer-facing processing.
• Tier 3 (low impact): test data, non-production, or non-material fields.

Then apply stronger controls to Tier 1 inputs: stricter validation, reconciliation, restricted access, and tighter monitoring.

Step 3: Define the policies and procedures (make them executable)

Write a short System Input Controls Standard that answers:

• What input paths are permitted and how new ones are approved
• Required validation categories (schema, field-level, business rule, referential integrity)
• Requirements for authentication/authorization for input submission
• How you log inputs, failures, and overrides
• How exceptions are triaged, fixed, and tracked to closure
• When and how you reconcile input completeness (and what triggers investigation)
• Change management expectations for validation rules (peer review, testing, approvals)

Keep it aligned to how engineering works. A policy that demands manual review of all inputs will not operate.

Step 4: Implement technical controls over inputs

Map each input path to concrete controls. Common control patterns that auditors accept when evidenced:

API inputs

• AuthN/AuthZ required for write operations
• Schema validation at gateway/service boundary
• Idempotency keys or deduplication for retries
• Rate limiting and payload size limits (availability/security overlap, but supports input integrity)
• Structured error responses and logged failures

UI/manual entry

• Required field enforcement and format constraints
• Role-based access to create/edit sensitive records
• Maker-checker approvals for high-impact changes (for example, pricing, payout destination, entitlement)
• Audit logs capturing who changed what and when

Batch/file imports (CSV/SFTP/object storage)

• File naming conventions and source authentication
• Checksum/hash or file integrity checks where feasible
• Schema validation and reject/quarantine for bad rows
• Control totals (record counts, amount totals) and reconciliation reports
• Clear rerun/backfill procedures with approvals for Tier 1 data

Streaming/queue/webhook inputs

• Contract testing / schema registry or validation at consumer
• Dead-letter queues and alerting on failures
• Replay controls and deduplication strategy
• Monitoring for lag, drop, and abnormal volume

Step 5: Add detective controls (reconciliation + monitoring)

Preventive validation won’t catch everything. Add detective checks that prove completeness and accuracy:

• Input-to-processing reconciliation (counts, totals, sequence ranges)
• Daily/weekly exception reports for failed validations, quarantined rows, and manual overrides
• Alerts tied to thresholds you define (for example, spikes in rejects, backlog growth, missing files)

Your reconciliations should produce artifacts that are easy to sample.

Step 6: Make exception handling auditable

Define and follow a consistent workflow:

1. Exception identified (validation failure, reconciliation break, missing file)
2. Ticket created with severity and impact
3. Root cause and fix documented
4. Data correction approach recorded (reprocess, backfill, manual adjust)
5. Closure approval where appropriate

Auditors often sample exceptions. If you “fix in Slack,” you will struggle to evidence operation.

Step 7: Package evidence for SOC 2 testing (design + operating)

SOC 2 testing usually asks for both:

• Design evidence: policy/procedure documents, diagrams, control descriptions, and responsible roles.
• Operating evidence: dated logs, screenshots, system reports, tickets, and sample records for a period.

Daydream can help by turning your input inventory into a control-to-evidence map, scheduling recurring evidence pulls, and keeping a clean audit trail for what was tested and when, so you are not rebuilding the same package each cycle.

Required evidence and artifacts to retain

Keep artifacts that match your input inventory and the auditor’s sampling approach.

Core artifacts

• System input inventory (table) with owners and control mapping
• System Input Controls policy/standard and exception handling procedure
• Architecture/data flow diagrams showing key input paths
• Validation rule documentation (or code references) and change history
• Access control evidence for who can submit or override inputs (roles/groups)
• Logs/reports showing validation failures and how they were handled
• Reconciliation outputs (control totals, completeness checks) plus sign-offs where required
• Tickets for exceptions and remediation, including approvals for material backfills
• Evidence of monitoring/alerting (alert definitions, incidents, on-call notes)

Retention note: Align retention to your SOC 2 audit period and your internal logging retention settings. Gaps in log retention are a common blocker even when controls exist.

Common exam/audit questions and hangups (what they will test)

Expect variations of:

• “List all system inputs in scope and show the controls for each.”
• “How do you know inputs are complete (no missing files/events)?”
• “Show evidence that invalid inputs are rejected and investigated.”
• “Who can override validation rules or manually edit records?”
• “How are one-time imports/backfills approved and validated?”
• “Show samples from the audit period for Tier 1 input paths.”

Common hangup: teams show a policy and a few screenshots, but can’t demonstrate consistency across all input channels.

Frequent implementation mistakes and how to avoid them

Mistake	Why it fails in audit	What to do instead
Treating “inputs” as only customer UI forms	Hidden paths (imports, admin edits, scripts) remain uncontrolled	Maintain a living input inventory tied to system architecture
Validation exists only in code with no evidence trail	Auditors need operating evidence, not assertions	Log validation failures and retain reports/tickets
No completeness checks	You can’t prove missing inputs are detected	Add reconciliations (counts/totals/sequence checks) for Tier 1
Manual overrides are untracked	Overrides are a direct integrity risk	Require tickets, approvals, and audit logs for overrides
Backfills done ad hoc	High risk of silent data corruption	Create a backfill runbook with approvals, test results, and post-run reconciliation

Enforcement context and risk implications

SOC 2 is an attestation framework, not a regulator, so “enforcement” shows up as qualified/adverse opinions, control exceptions, and customer trust impacts, not fines tied to this criterion ¹. The risk is practical: uncontrolled inputs can cause incorrect customer reports, billing errors, faulty decisioning, or misstated operational metrics. If you serve regulated customers, they may treat repeated processing integrity exceptions as a material vendor risk issue during third-party due diligence.

A practical 30/60/90-day execution plan

Days 1–30: Get scoped and documentable

• Confirm Processing Integrity scope and list in-scope systems.
• Build the input inventory for each system, including admin and batch paths.
• Classify Tier 1 inputs and identify missing validations/reconciliations.
• Draft the System Input Controls standard and exception workflow.
• Decide evidence sources (which logs/reports/ticket fields will prove operation).

Days 31–60: Implement controls that create evidence

• Add or tighten validation at key boundaries (API gateway, import pipeline, consumer).
• Stand up reconciliation checks for Tier 1 inputs and define investigation triggers.
• Ensure audit logging for manual edits and overrides is enabled and retained.
• Update runbooks for imports/backfills, with approval and post-run checks.
• Run a tabletop “audit sample” test: pick a week and assemble evidence.

Days 61–90: Operationalize and harden

• Train engineering/support/admin users on the exception workflow.
• Add monitoring/alerting for validation failure rates and reconciliation breaks.
• Perform an internal control test with sampling across input types.
• Fix documentation gaps: owners, frequency, screenshots, report exports.
• Build a repeatable evidence package (Daydream-style evidence map and calendar).

Frequently Asked Questions

What counts as “system inputs” for TSC-PI1.2?

Any way data enters an in-scope system: APIs, UI forms, file imports, webhooks, queues, admin consoles, and scripted backfills. If it can change stored data or trigger processing, treat it as an input channel.

Do we need reconciliations for every input path?

Focus reconciliations on Tier 1 inputs where missing or duplicated data would materially affect customer outcomes or reporting. For lower-risk inputs, strong validation and error logging may be enough if you can defend the risk rationale.

Are access controls part of “system inputs”?

Yes, because unauthorized submission is an input integrity failure mode. Show who can submit, who can override, and how those permissions are reviewed and logged.

How do we evidence API validation in a SOC 2 audit?

Provide documentation of validation rules plus operating evidence such as logs of rejected requests, error dashboards, and sampled tickets showing investigation of repeated failures. Auditors typically want samples from within the audit period.

We quarantine bad rows during imports. Is that sufficient?

Quarantine is strong, but you still need procedures and evidence for triage and remediation, including who approves reprocessing and how you confirm the final dataset is complete and accurate.

How should we handle one-time backfills and data fixes?

Treat them as controlled input events: require a ticket, approval for Tier 1 datasets, testing notes, and post-run reconciliation results. Keep artifacts so the change is explainable months later.

Related compliance topics

• 2025 SEC Marketing Rule Examination Focus Areas
• Access and identity controls
• Access Control (AC)
• Access control and identity discipline
• Access control management

Footnotes

1. AICPA TSC 2017