CAATs
John Tyrpak
Steve Sheller
Philip Andrews
Ginger Bean
The Difference Between CAATS and
CAATTS
– CAATs are Computer Assisted Audit Techniques
– CAATTs are Computer Assisted Audit Tools and
Techniques
– Benefit: Now able to test 100% of data and it’s
efficient
CAATs
• Software used to increase an auditor’s personal
productivity and software used to perform data
extraction and analysis
• Techniques to increase the efficiency and
effectiveness of audit function
Types of CAATs
• Any software that assists the auditor in
performing administrative tasks more
efficiently. (Word, Excel)
• Software used to manage the engagement
• ACL – Audit Command Language (bestknown software)
Audit Tools with CAATs
– Productivity Tools
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E Work papers
Groupware
Time and Billing Software
Reference Libraries
Document Management
– Generalized Audit Software (GAS) Tools
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ACL (most common)
AuditExpert Systems
Utility Software
Statistical Software
Computer Assisted Audit Tools
Productivity Tools
• E-workpapers
– Creating a “paperless” workplace
• Groupware
– Allows multi-user scheduling, planning, file sharing
• Time and Billing Software
– Easily account for chargeable hours and prepare bills
• Reference Libraries
– Efficiency in finding and reporting information
• Document Management
– Online storage of documents made readily available
Computer Assisted Audit Tools
Generalized Audit Software Tools
• ACL
– Performs the routine tasks
• Audit Expert Systems
– Based on a series of “if-then” production rules
• Statistical Analysis
– Performs statistical analysis on a client’s data
file
Audit Techniques with CAATs
– Validate Application Integrity
• Test Data
• Integrated Test Facility (ITF)
• Parallel Simulation
– Verify Data Integrity
• Data Extraction and Analysis
• Detect Fraud
• Continuous Auditing Techniques
Ten Steps to using CAATs
– Steps 1 – 4 involve Planning
– Steps 5 – 6 involve requesting and importing data
– Step 7 – 9 Testing data
– Step 10 – Documenting results
Planning
• Set Key Objectives
• Identify CAATs
• Data Needed from the Client
Data Processing
• ACL
• CAATs Processes
Final Processes
• Exceptions
• Document Results
Benford’s Law
• The leading digit of a series of naturally
occurring numbers does not follow a uniform
distribution. It will follow an exponential
distribution.
• http://en.wikipedia.org/wiki/Benford%27s_law
• http://www.kirix.com/blog/2008/07/22/funand-fraud-detection-with-benfords-law/
Payroll Fraud
• Controls in Place
• Getting CAATs Involved
• A Fraud Discovered
Sources
• Core Concepts of Information Technology
Auditing; Hunton, Bryant, Bagranoff
• http://en.wikipedia.org/wiki/Benford%27s_la
w
• http://www.kirix.com/blog/2008/07/22/funand-fraud-detection-with-benfords-law/
• Bnet Business Network online
http://findarticles.com/p/articles/mi_m4153/i
s_3_58/ai_77151373/pg_1?tag=artBody;col1