Module I: Introduction & Accounting - Tally 1

Difference between Manual Accounting and Computerised Accounting through

TallyPrime:
Basis Manual Accounting Computerised Accounting (TallyPrime)
Record Transactions are recorded manually in Transactions are recorded digitally and
Maintenance books or ledgers. stored in a database.
Speed Time-consuming due to manual entry and Fast and efficient with automated data
calculations. entry and calculations.
Accuracy Prone to human errors in calculations and Reduces errors with built-in checks and
postings. automated processes.
Reporting Generating reports (e.g., profit/loss, Reports are generated instantly and can be
balance sheet) is manual. customized as needed.
Data Storage Physical storage of papers and files, Digital storage, easy to retrieve and access
and Retrieval difficult to retrieve data
Data Backup No automatic backup; records are prone to Allows secure data backup and recovery
physical loss or damage. options to protect records.
Scalability Difficult to adapt to changing business Easily scalable and flexible, can adapt to
and Flexibility needs growing business needs and changing
regulations
Components of Home Screen of TallyPrime:
The Home Screen of TallyPrime is designed to provide easy navigation and access to key functions. Below
are the key components of the Home Screen:
1. Top Menu Bar
The Top menu bar in TallyPrime is a horizontal strip located at the top of the home screen, providing quick
access to essential functions. It contains the following options:
Company Data Exchange Go To Import Export Share Print Help
2. Current Status Area
In TallyPrime, the Current Status Area is located just below the Top Menu Bar, on the left side of the screen.
This section displays critical information such as:
• Current Period: The active financial period.
• Current Date: The working date set in the application.
• Names of Companies: Displays the companies currently open.
• Date of Last Enry: Shows the last date of transactions for each company.
3. Gateway of Tally
The Gateway of Tally, located centrally, acts as the main navigation hub for TallyPrime. It is divided into
the following sections:
• Masters: The Masters section in TallyPrime provides access to essential functions for managing the
foundational data of your business. It includes options such as:
o Create: Allows the creation of various master records like ledgers, groups, stock items, and more.
o Alter: Enables you to modify existing master records to reflect changes in your business.
o Chart of Accounts: Displays a structured list of all ledger accounts and groups, providing a clear
overview of your financial structure.
• Transactions: The Transactions section in TallyPrime provides access to essential functions for
recording and managing day-to-day financial activities. It includes options such as:
o Vouchers: Allows users to create or enter various types of vouchers, such as Sales, Purchases,
Payments, Receipts, Journal, and Contra vouchers.
o Day Book: Displays a detailed, chronological record of all transactions entered, offering an overview
of the financial activities for a specific period.

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• Utilities: The Utilities section in TallyPrime provides access to bank-related operations, such as bank
reconciliation, cheque printing etc.
• Reports: View financial statements, stock summaries, and other reports.
• Quit: You can quit from TallyPrime by clicking on the ‘Quit’ option or simply by pressing the “Esc”
key on your keyboard.
4. Right Button Bar
The Right Button Bar on the Home Screen of TallyPrime provides quick access to frequently used functions
and related actions. These options include:
• F2: Date – Quickly change the voucher or report date.
• F3: Company – Switch between companies or select a company.
• Other Options – Appear dynamically based on the screen or menu you are working in, ensuring smooth
navigation and efficiency.
5. Calculator Area
In TallyPrime, the Calculator Area is not visible by default on the Home Screen. It appears at the bottom of
the screen when you press the Ctrl + N keys. It allows users to perform calculations directly without needing
to switch to an external calculator. The Calculator Area is especially useful for quickly adding, subtracting,
multiplying, or dividing amounts while working in TallyPrime.

TALLY ORIGIN
Tally Origin refers to the origin/background of Tally as an accounting software. Here is a brief
overview:
Origin of Tally Accounting Software
1. Company Background:
▪ Tally Solutions Pvt. Ltd., the company behind Tally, was founded in 1986 by Shyam Sunder
Goenka and his son Bharat Goenka in Bangalore, India.
▪ The original idea for Tally arose when the founders recognized a need for a robust, yet simple,
accounting software that could automate accounting tasks for businesses. The term ‘Robust’
here means reliable, strong, and capable of handling a wide range of accounting tasks
effectively without failure.
2. First Version of Tally:
▪ The first version of Tally was developed in 1988 and was named "Tally 4.5". It was a DOS-
based accounting software that provided basic accounting functionalities like ledger
accounting, financial reporting, and inventory management.
▪ Over the years, Tally evolved to become more sophisticated with versions like Tally 5.4, Tally
6.3, Tally 7.2, Tally 8.1, and Tally 9, which introduced features like VAT, TDS, payroll, multi-
currency support, and more.
3. Evolution to [Link] 9 and Tally Prime:
▪ [Link] 9, launched in 2009, was a major upgrade, offering comprehensive features such as
GST (Goods and Services Tax) support, statutory compliance, inventory management, and
enhanced reporting capabilities.
▪ In November 2020, Tally Solutions launched Tally Prime, the latest and more advanced version
of the software. Tally Prime provides a more intuitive user interface, better navigation,
enhanced capabilities for reporting, and improved performance. It aims to simplify complex
business tasks and provide an improved user experience.
4. Purpose of Tally Prime:

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▪ Tally Prime is designed to cater to the needs of small and medium-sized businesses (SMBs) as
well as large enterprises by providing tools for accounting, inventory management, taxation,
payroll, and compliance.
▪ It offers features like easy data management, remote access, simplified GST compliance, multi-
user and multi-location support, secure data handling, and detailed financial reports.
Conclusion
Tally's origin lies in the vision to create a simple yet powerful accounting software for Indian
businesses. From its humble beginnings to the current Tally Prime version, Tally has evolved to
become one of the most popular accounting solutions in India and globally. Tally Prime continues
this legacy by offering modern features tailored to meet current business requirements, ensuring
seamless accounting and compliance for its users.

General Features of Tally Prime

Tally Prime is an advanced accounting and business management software developed by Tally
Solutions, designed to simplify complex business processes. It is widely used by small and
medium-sized enterprises (SMEs) for its robust features, user-friendly interface, and versatility.
Below are the general features of Tally Prime:
1. Comprehensive Accounting Management: Tally Prime allows for comprehensive
accounting solutions, including handling all aspects of accounting such as receivables,
payables, income, expenses, and general ledger management. It provides detailed financial
reports like balance sheets, profit and loss statements, and cash flow statements.
2. Versatility: Versatility is a key feature of Tally Prime, meaning the software can easily adapt
to a wide range of business needs and requirements. This means that Tally Prime is not limited
to a specific type of business or industry; instead, it can be used effectively by various types of
businesses—such as retail, manufacturing, services, and more—due to its flexible and
customizable features.
3. Inventory Management: Tally Prime provides several tools for effective inventory
management, allowing businesses to maintain accurate stock levels, track inventory movement,
and manage stock efficiently.
4. GST Compliance: Tally Prime offers full support for Goods and Services Tax (GST) in India,
including the generation of GST-compliant invoices, calculation of GST returns, and easy
filing of GST returns. It also supports e-invoicing and e-way bill generation.
E-invoicing (i.e., electronic invoicing) is the process of generating, sending, and receiving
invoices electronically, rather than in paper form.
E-way bill (i.e., electronic way bill) is an electronic document required for the movement of
goods worth more than a specified amount (currently ₹ 50,000 in India) within a state or across
states. The e-way bill contains details such as: (1) Goods being transported (2) Consignor and
consignee information (3) Vehicle number (4) Route and distance (5) GSTIN (GST
Identification Number) of the supplier and recipient. The main motive of the e-way bill is to
ensure compliance with GST regulations and prevent tax evasion.
5. Multi-User and Multi-Location Support: Tally Prime supports multiple users and locations,
making it ideal for businesses with branches or remote offices. It enables users to create and
handle business transactions, inventory, and financial reports for each location separately, and
also generate consolidated reports for overall business analysis.

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6. Bank Reconciliation: Tally Prime simplifies bank reconciliation by automatically matching

bank statements with the transactions recorded in the software, highlighting discrepancies, and
facilitating quick resolution of mismatches.
7. Payroll Management: Tally Prime software includes payroll management features that allow
businesses to handle employee salaries, deductions, bonuses, tax calculations, and generates
statutory reports like Provident Fund (PF) and Employees State Insurance (ESI).
8. Remote Access: Tally Prime allows users to access their data from anywhere, anytime, through
[Link]. [Link] is a cloud-based service provided by Tally Solutions that provides secure
remote access and updates to Tally data via an internet connection.
9. Data Security: Tally Prime also ensures high data security with user-level password
protection, data encryption, and regular backups. Data encryption is a security process that
converts data into a coded format to prevent unauthorized access. You can manually back up
your data to local storage or use [Link] for cloud-based backups. Regular backups help
ensure that your financial data is secure and can be restored in case of data loss or corruption.
10. Customizable Reports and Dashboards: In Tally Prime, users can generate customizable
reports and dashboards to gain insights into various business aspects like financial
performance, sales, purchase orders, and inventory levels. The data can be easily exported to
Excel and PDF formats.
11. Invoicing and Billing: Tally Prime allows easy creation of invoices and bills, supporting
multiple currencies and formats. It helps track receivables and payables efficiently and manage
outstanding balances.
12. Multi-Currency Support: Businesses that operate globally can benefit from Tally Prime’s
multi-currency capabilities, which allow transactions in multiple currencies with automatic
exchange rate adjustments.
13. Compliance Management: Tally prime supports various statutory compliances including
TDS (Tax Deducted at Source), TCS (Tax Collected at Source) and GST.
14. Easy Data Migration: Tally Prime offers an easy data migration from previous versions to
the latest version. This helps businesses upgrade to Tally Prime without losing historical data.
15. User-Friendly Interface: Tally Prime has a user-friendly interface that is easy to use, even for
those with little technical experience. It includes a "Go To" search bar for quick access to
various features and functions.
16. Support for Multiple Companies: Tally Prime allows management of multiple companies
under a single license, enabling easy comparison, consolidation, and financial analysis across
different business entities.
17. Business Reports on Mobile: Tally Prime provides access to important business reports on
mobile devices through the Tally Reports app, ensuring business continuity and decision-
making on the go.
18. Audit Tools: Tally Prime offers tools that simplify audit processes by generating audit reports,
vouchers, and other documents that help in internal and statutory audits.
Conclusion:
Tally Prime is a powerful tool designed to meet the diverse needs of businesses, offering a
comprehensive solution for accounting, inventory, payroll, compliance, and more. Its ease of use,
flexibility, and scalability make it a popular choice for businesses of all sizes.

© CA. R. K. Behl