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Auditing: What are CAATs?

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What are CAATs and why would or should they be used?

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CAAT is an acronym for Computer Aided Audit Tools, or Computer Assisted Audit Techniques. I find it curious that current literature shows both names while the acronym is the same. Regardless, it relates to a new way to conduct the age-old audit technique of testing.

CAAT is a broad term to encompass four basic categories of mechanized audit functions. It is likely that the most common technique is the use of data analysis software. Before companies computerized their accounting applications, the testing followed the manual procedures for record keeping. With companies now using electronic processing and storage of data, the audit function works best using similar procedures.

Before the conversion to electronic ...

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The 441 word referenced solution explains what a CAAT is and how they can be used in auditing.