I. Executive Summary
Nowadays, the use of computers dominates in most of the business world; auditors too have recognized that the power and speed of computers can greatly assist them in their work. The term “computer-assisted audit techniques” (CAAT) is used to denote computer techniques that auditors can utilize to help them complete their audits in a more effective, efficient, and timely manner. Use of the prefix “computer-assisted” seems to suggest that an auditor’s use of a CAAT is unusual; in other words, the techniques normally used by an auditor are not computer-assisted. However, since today almost all business processes in large and medium-sized business enterprises are computer-based, use of computers in the performance of audits hardly seems to be an option and will eventually be assumed; the prefix “computer-assisted” will be omitted.
The purpose of this paper is to provide information about CAATs. This paper describes CAATs, compares CAATs to traditional audit procedures, and discusses the costs, risks, and benefits of using CAATs. The paper also discusses specific types of CAATs such as data analysis software, the test data technique, utility software and the audit-expert system. It also brings up issues that the auditor may encounter, suggests the recommendations to overcome the issues, and the barriers/ challenges when using CAATs.
II. Introduction
In general, the objective and scope of an audit do not change when it is conducted using a computer. The objective is still to determine if the financial statements issued by the management of a business accurately and adequately conform to generally accepted accounting principles, thereby presenting a true picture of the economic reality of the business. The concept of CAAT also is not new in the audit field. It implies the utilization of information technology resources in the auditing procedures to achieve its desired
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