Yes it is compatible, were you using the latest avast version, avast! 2014 (9.0.2006) ?

See http://forum.avast.com/index.php?topic=136785.0 for more information and download links. ].

I don’t know what the windows 8.1 update entails, if it is a destructive update or if it would remove installed AVs and enable Defender or not.