What does the PROC FORMAT procedure do in SAS?

The PROC FORMAT procedure in SAS is essential for creating custom formats that can be applied to variables in a dataset. This capability allows users to define how data values are displayed or presented in reports, making them more understandable and visually appealing. For example, with PROC FORMAT, you can create formats to change numeric values to character strings, apply labels to categories, or display percentages instead of raw numbers.

Custom formats can also facilitate data analysis by allowing you to easily change the way data is represented without altering the underlying data itself. This functionality is particularly beneficial when you want to standardize the display of values across different reports or when you need to categorize continuous variables.

Other options, such as merging datasets, generating summary statistics, or importing external data, pertain to different procedures in SAS and do not relate to the purposes of PROC FORMAT. Each of those tasks is performed by specific procedures designed for those functions, distinguishing them from the format creation capabilities of PROC FORMAT.