SOC for Supply Chain

Chapter 1Introduction and Background

This chapter explains the relationship between an entity¹ that produces, manufactures, or distributes products and its suppliers, customers, and business partners; provides examples of such entities and the products they produce, manufacture, or distribute; explains the relationship between the products and the system that produces, manufactures, or distributes them; describes the components of the system and its boundaries; identifies the criteria used to evaluate a description of an entity's system (description criteria); and identifies the criteria (applicable trust services criteria) used to evaluate whether controls stated in the description, which are necessary to provide reasonable assurance that an entity achieved its principal system objectives, were effective. This chapter also provides an overview of a SOC for Supply Chain examination and the standards under which the examination is performed. In addition, it provides an overview of other SOC services.

Introduction

1.01 Manufacturing is the production of goods or products² for use or sale using labor and machines, tools, chemical and biological processing, or formulation. The term manufacturing is most commonly applied to industrial production, in which inputs such as raw materials and components are transformed into finished goods on a large scale. Finished goods may be sold directly to (a) end users (for example, medical devices sold to health systems); (b) other manufacturers ...