Compliance glossary
Definition

Penetration Testing

An authorized, simulated attack against your systems to identify exploitable vulnerabilities before real attackers do.

What it means.

Penetration testing (often shortened to pen testing) is an authorized, scoped exercise where security professionals attempt to exploit vulnerabilities in your systems the way a real attacker would. The FTC Safeguards Rule requires annual penetration testing for firms with 5,000 or more consumer records that do not implement continuous monitoring (16 CFR 314.4(d)(2)). Tests can be external (internet-facing assets) or internal (assumed-breach scenarios). Findings are documented with severity ratings and remediation recommendations.

Why it matters for CPA firms.

Pen testing is the FTC's expected substitute for continuous monitoring. Skipping both is a clear compliance gap if your firm is above the record threshold. A small-firm external pen test typically costs $5,000 to $15,000 annually. Insurance carriers increasingly require evidence of a recent test before issuing coverage. Document the scope, the testing firm, the findings, and what you remediated.

Relevant regulations.

  • 16 CFR 314.4(d)(2)
  • NIST SP 800-115

How Kompflow helps.

The Continuous Control Testing (Professional) module handles this for your firm, personalized to your software, team size, and state requirements.

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