Have you rebooted since the update ?
If not do so, if you have it may need to be rebooted a time or two.
If that doesn't work try a repair of avast:
XP - Add Remove programs, select 'avast! Anti-Virus,' click the Change/Remove button and select Repair, click next and follow.
Vista, win7 - Control Panel, Programs & Features, uninstall a program, select 'avast! Anti-Virus,' click the Uninstall/Change and select Repair, click next and follow.
You may need to reboot after the repair.