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Chapter Eight

Chapter Eight. Using Computer Assisted Audit Tools and Techniques (CAATTs). Two Categories of CAATTs. 1) Computer Assisted Audit Tools 2) Computer Assisted Audit Techniques. Computer Assisted Audit Tools. Productivity Tools Generalized Audit Software Tools. Productivity Tools. Include:

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Chapter Eight

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  1. Chapter Eight Using Computer Assisted Audit Tools and Techniques (CAATTs)

  2. Two Categories of CAATTs • 1) Computer Assisted Audit Tools • 2) Computer Assisted Audit Techniques

  3. Computer Assisted Audit Tools • Productivity Tools • Generalized Audit Software Tools

  4. Productivity Tools • Include: • E-workpapers • Groupware • Time and billing software • Reference libraries • Document management

  5. Generalized Audit Software Tools • Include: • ACL • Audit expert systems • Utility and statistical software

  6. ACL • Widely used for data extraction and analysis • Allows for virtual 100% testing of client data

  7. Computer Assisted Audit Techniques • CAATs to Validate Audit Techniques • Test desks • Integrated test facility • Parallel simulation • CAATs to Verify Data Integrity • Data extraction and analysis • Fraud detection • Continuous auditing techniques

  8. 10 Steps to Using CAATs • 1. Set key audit objectives • 2. Identify CAATs to be used • 3. Identify which data files are needed • 4. Determine which format you need • 5. Request files from client in preferred format • 6. Import data into ACL

  9. 10 Steps (Con’t) • 7. Use CAATs to verify the data import process • 8. Perform other CAATs • 9. Investigate and reconcile exceptions • 10. Document results in workpapers

  10. CAATs to Detect Fraud • Digital analysis • Benford’s Law for a series of naturally occurring numbers • Deals with expected frequency of first digits • Exponential distribution • Requires large sample size

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