DSE 502 (a): COMPUTERIZED ACCOUNTING

B Com V semester

UNIT-I: Maintaining Chart of Accounts in ERP

COMPUTERISED ACCOUNTING
Maintaining Books of Accounts on computer is called a Computerised Accounting.
Definition: Computerised Accounting can be defined as maintaining Book keeping and
Accounting on computers by using accounting Software package, substituting the traditional
and manual accounting system.
Need for Computerised accounting
The need for computerized accounting arises from advantages of speed, accuracy and lower
cost of handling the business transactions.
Numerous Transactions:
The computerized accounting system is capable of large number of transactions with speed
and accuracy.
Instant Reporting:
It is capable of offering quick and quality reporting because of its speed and accuracy.
Reduction in Paper Work:
Manual accounting system requires large storage space to keep accounting records/books,
and vouchers/documents. The requirement of books and stationery and books of accounts
along with vouchers and documents is directly dependent on the volume of transactions
beyond certain point.
There is a dire need to reduce the paper work and dispense with large volume of books of
account. This can be achieved with the help of computerized accounting system.
Flexible Reporting:
The reporting is flexible in computerized accounting system. It is capable of generating
reports of any balance as when required and for any duration which is within the accounting
period.
Accounting Queries:
There are accounting queries, which are based on some external parameters. For example, a
query relating to overdue customers’ accounts can be easily answered by using the
structured query language [SQL] support of database technology in the computerized
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accounting system. Such an exercise would be quite difficult and expensive in manual
accounting system.

Online Facility:
Computerized accounting system offers online facility to store and process transaction data
so as to retrieve information to generate and view financial reports.
Accuracy:
The information and reports generated are accurate and quite reliable for decision-making.
In manual accounting system, as many people do the job and the volume of transactions is
quite large, such information and reports are likely to be distorted and unreliable and
inaccurate.
Security:
This system is highly secured and the data and information can be kept confidential, when
compared to manual accounting system.
Scalability:
The system can cope easily with the increase in the volume of business. It requires only
additional data operators for storing additional vouchers.
Features/Advantages/Merits of Computerised Accounting
1. Automatic Processing: In Manual Accounting system transaction to be recorded in the
books of Accounts has to pass through many systems i.e. Journal Entry, Ledger posting,
preparation of Trail Balance and Final Accounts this process is very lengthy and
consumes lot of time, Where as in computerized Accounting system, a transactions
has to recorded once through a data entry screen and the computer Automatically
does the rest of processing of the transaction.
2. Immediate Results: In manual accounting the preparation of P&L A/c and Balance
Sheet takes time space from days to months but in computerized accounting the P&L
A/c, Balance sheet readily available.
3. Availability of information as & when required: Computerised Accounting system
facilitates you get final accounts and any other information has frequently as desired.
4. Efficient Reporting: In computerized accounting any kind of reports can be easily
prepared and they does not delay the routine accounting cycle.
5. Less man power: In manual accounting system more persons are required to process
the data where as in computerized accounting works mainly handle by the computer
hence no need for more persons. When compiled with manual system.

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6. Minimizing Mathematical Errors: While doing mathematics with computers, error are
virtually eliminated unless the data is entered improperly in the first instance.
7. Relieve Monotony (Reduce Repetitive): Computerised accounting reduces the
monotony of doing repetitive accounting jobs, which are tiresome and time
consuming.
8. Detailed information about the products: In computerized accounting the ad-hoc
reports can be easily prepared with the use of representation modules.
9. Security: In computerized accounting system, the password, mechanism ensures that
the access to the accounting data is allowed only to the authorized persons only.
DISTINCTION BETWEEN MANUAL ACCOUNTING AND COMPUTERISED ACCOUNTING:
The following steps shows the Distinction (Different) between Manual Account and
Computerised Accounting system.

Manual System Computerised System

1. Arrangement and allocation of working
space for accounting work
2. Arrangement of space for keeping books
of accounts for a specified entity, Blank
Books to write the Books of Accounts.
3. Writing of Ledger Names in Ledger Books 3.
writing the Opening Balance of each
ledger account.
4. Writing of vouchers with each
transaction details.
5. Recording the vouchers in primary books
(like journal)
6. Posting of basic records of transaction in
ledger books and balancing each ledger
account.
7. Preparation of Trail balance from the
ledger balance. 7.
8. Preparation of Financial statements (like
P&L, Balance Sheet etc.) 8.
9. Prepare various other periodical & casual
statements & reports. Compile data,
1. Installation of Accounting Software
system in your computer( i.e. Tally)
2. Company Creation. Accounting software
allocates specified place in your
computer to keep all the data of the
specified company exclusively.
Masters Creation, which involves New
Account Group creation (if necessary).
Ledger Account creation( and entering
the Opening Balance)
4. Voucher entry. All your recording jobs
end here. Hence forth print all upto date
accounting books, statements or
Reports without any further writing,
posting, casting, balancing, etc,
whenever & as many times as you want
to.
5. No further recording needed. Just print
the primary books from the vouchers
recorded in step 4.
6. No further posting or balancing needed.
Just print the ledger( with closing
balance of each ledger account) as per
vouchers recorded in step 4.
No compilation needed. Just print the
Trial balance, after step 4.
No compilation needed. Just print the
upto date financial Report you want,
after step 4.

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 write figures, total, balance. Chances of 9. No compilation or any work needed.
human error in casting and arithmetic Just print the upto date Report you
computation. want, after step 4.

Limitations / Disadvantages of Computerised Accounting

1. Expensive: A small firm cannot install a computer accounting system because of its
high installation and maintains cost. A full-fledged computer system with a printer is
required to operate the computerized accounting system. Most small organizations
may not afford to have such facility with necessary computerized accounting system.
2. Problems of security and confidentiality: In computerized accounting there is
always a security threat to the accounting data. The accounting data of the firm is
stored on a computer and anyone who gets the access to the computer can do
anything with the data. There is always a possibility that some unauthorized person
can crack the password of the system and will have full control of the accounting
data.
3. User Training: The user, for using computer accounting software, needs to
understand the concepts of the software. Hence, he should undergo proper training.
A computer operator must learn the basis of computer, concepts of software,
working with the operating system software and the Accounting software.
4. Backups and prints: Backups of the data should be done regularly so that, when the
data is lost, it can be restored from floppies [backups]. Regular print outs of the
system information would be useful as manual records.
5. System Dependency: Using a computer solution makes the user to depend fully on
the computer system and necessitates the availability of computer at all times. If the
system is not available (due to hardware failure or power cut) it would be difficult to
verify the accounts.
History of Tally :
Tally Solutions, then known as Peutronics, was co-founded in 1986 by Shyam Sunder
Goenka and his son Bharat Shyam Sunder Goenka. The first version of the accounting
software was launched as an MS-DOS application. It had only basic accounting functions,
and was named Peutronics Financial Accountant. It was known as the first code less
package, a feature that made it easy for most people to use.
In 1988, the product was renamed as Tally.
In 1999, the company formally changed its name to Tally Solutions.
In 2005, Tally 7.2 was launched with features designed to meet Indian value-added taxation
(VAT) requirements.
In 2006, Tally launched Tally 8.1, a concurrent multi-lingual version
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In 2009, the company released Tally ERP 9, offering complete business management
solution.
Tally main product is its Enterprise Resource Planning Software called Tally ERP 9 with single
user and multi-user licenses. For large organizations with many branches, Tally. Server 9 is
offered. The software handles accounting, inventory management, tax management, payroll
etc.
Features of Tally:
Tally has 3 types of Features. They are
1. Accounting Features
2. Inventory Features
3. General Features
Accounting Features:
No Codes: Some Accounting Packages need codes to each Account, Debtors & creditors. It is
very difficult to memorise. But in Tally there are no codes. We can give the information
easily.

 Unified Ledgers: Tally integrates your General, Sales and Purchase. Ledgers into a
single ledger.
 Complete Book Keeping: All types of the transactions like receipts, payments,
income and expenses, sales and purchases, debit notes Credit notes, adjustments
memorandum Journals and revising Journals can be recorded by unique voucher
entry.
 Comprehensive Accounting: We can instantly obtain Profit & loss statements,
Balance sheets Ratios, cash and fund flows, Trail balance etc.
 Multicurrency Accounting: Tally allows multiple currencies in same transaction. It
shows all reports in one or more currency i.e., Dollars and Indian Rupee.
 Interest Calculation: Provides various options of interest calculations.
 Payment Performance of Debtors: Tally enables to identify the trouble debtors and
persist late payers.
 Security: It is secured against data tampering.
 ODBC: Tally uses Open Date Base Connectivity to connect other programs and
exchange data dynamically.
 Financial Ratio Analysis: Tally offers the bird eye view of the management through a
single sheet performance analysis.
 Receivable and Payables: Tally maintains all details of B/Rs &B/Ps with due dates,
reminders etc.
 Quotations Orders Vouchers Invoice & Cheques: It generates the forms and prints
on line, there are several options for configuring default formats.
 Budgeting: Tally gives unlimited Budgets and Accounting periods.
 Accounts pertaining to Unlimited companies: Tally con continue accounts for more
than one year at a time.

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  Working on Multiple Years Simultaneously: Users can continue account for more
than one year at a time.
 Unlimited Number of years: There is no limit for the number of years.
 VAT: Tally is amenable to VAT (Value Added Tax) stipulations.

Inventory features:
 Multi Location Stock Control: Tally helps us to manage simple single location, or
complex multi-location stocks with unlimited classification system for our items.
 Flexible Units of Measure: Tally helps to track stock, irrespective of the units of
measure with this we can buy in tons and sell in kilograms.
 Comprehensive Recording of Stock Movement: All sorts of inventory transactions
can be recorded by using inventory voucher forms.
 Variety of Management Reports: Gives party wise details of goods bought and sold
and helps to identify customer buying patterns through movement analysis.
 Sales & Purchase Orders: We can prepare the purchase and sales orders with full
details of inventory deliveries, invoicing and accounts.
 Invoicing: Sales invoices can be printed, exported, emailed or published directly from
Tally. Tally allows flexible handling of charges & Taxes.
 Multiple Stock Valuations: Tally allows us to select form various types of valuation
methods for example First In First Out(FIFO), Average Cost, Last in First Out.

General Features:

• Open Tally: We can create any format in ODBC compliant Software like Ms Word
and MS Excel and then pull data from Tally.
• Multi-lingual Capability: It supports various fonts and Languages in Computer
(Unicode) and the various Indian Languages – Hindi, Marathi, Tamil, Telugu,
Kannada, Punjabi, Gujarathi, Bengali and Malayalam.
• Payroll Management: It automates the management of company’s employee
records including visa and contact management. This feature also offers automatic
calculation of salaries and pay slip generation.
• Online Help: This feature offers us, “Context Sensitive Help”. If we press help button
while in Tally, it will bring up the relevant topic.
• Drill down facility: With the help of this feature one can instantly update from any
report starting the balance sheet down to voucher or vice versa. By sing enter and
ESC keys.
• Consolidation of Companies: It enables grouping of companies and provides
consolidated reports. Changes made in any branch company are automatically
updated.
• Cutting-Edge Technology: This feature enables us to benefit form collaborative
technology success protocol support for HTTP, HTTPS, FTP, SMTP, ODBC and Raw
Sockets.

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Gate Way of Tally:
The welcome screen , “Tally.ERP 9 – Power of Simplicity’ appears while the software loads.
When the Tally.ERP 9 start-up screen appears, you are ready to explore Tally.ERP 9.

Components of Gateway of Tally

The Gateway of Tally screen may be divided in following main sections.
Horizontal Button Bar: Contains various Buttons to perform tasks.
Main Area: Tally main area is divided into two parts.
1. Current Status : Left part is about the Current status (Current Period, Current Dae),
Currently Active Company and selected companies with Date of Last entry details.
2. Tally Menu: Right part shows the current Tally Menu (Gateway of Tally).
Options Available on Gate way of Tally Menu
 Account Info: To create display, alter or delete, the Account books ledgers, Groups,
cost Centers to modify monthly or Annual budgets which we select it.
 Inventory Info: To Create display, alter or delete, the Stock Groups, Stock items and
Units of Measure and etc.
 Transactions: Except the first time of entering vouchers, we can select this option to
record the vouchers (transactions) on any subsequent date.
 Accounting Vouchers: This option helps to record all the transactions through
different vouchers. We can also modify previously entered vouchers.
 Inventory Vouchers: To create, alter the Inventory Voucher Creation (Stock Journal
with Number) etc.
 Import of Data: Select to import the Data.
 Banking: In this Menu all options are related to Bank. Ex. Cheque Register, Cheque
printing, Bank reconciliation, deposit slip etc.
 Reports:
Balance sheet: i) This option is select and press enter key for display /
print the Balance sheet.
ii) Press Alt+F1 for detailed Balance sheet.
Profit & Loss A/c: i) This option is select and press enter key for display/
Print the Trading and Profit and Loss A/c.
ii) Press Alt+F1 for detailed Balance sheet.
Stock Summary: i) This option is selected and press enter Key to display
the Stock summary (Stock Group and Item wise).

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 ii) Press Alt+F1 for detailed Stock summary.
Ratio Analysis: This enables to display the Ratio Analysis statements.
Display: Selects this option to Display / print all books of Accounts,
statement of accounts.
Quit: To quit Gate way of Tally use this option.

Short cut Keys:

Functions Functionality Availability

F1 To select a company All all masters menu screen
F1 To select the Accounts Button At the Accounting Voucher creation and
alteration screen
F1 (ALT+F1) To select the Inventory At the Inventory/Payroll Voucher creation
To view the detailed or and alteration screen in almost all the
condensed report reports
F1 (CTRL+F1) To select Payroll Vouchers to At the Accounting/Inventory voucher
alter creation or alteration screen.
F2 To change the current date At almost all screens in TALLY.ERP 9
To select company inventory At the F11: Features screen
features
F3 To select the company Al almost all screens in TALLY.ERP 9
To select company statutory At the F11: Features screen
and Taxation features
F4 To select the Contra voucher At Accounting/Inventory Voucher creation
and alteration screen
F5 To select the Payment voucher At Accounting/Inventory Voucher creation
and alteration screen
F6 To select the Receipt voucher At Accounting/Inventory Voucher creation
and alteration screen
F7 To select the Journal voucher At Accounting/Inventory Voucher creation
and alteration screen
F8 To select the Sales voucher At Accounting/Inventory Voucher creation
and alteration screen
F8 (CTRL+F8) To select the Credit Note At Accounting/Inventory Voucher creation
voucher and alteration screen
F9 To select the Purchase voucher At Accounting/Inventory Voucher creation
and alteration screen
F9 (CTRL+F9) To select the Debit Note At Accounting/Inventory Voucher creation
voucher and alteration screen
F10 To select the Reversing Journal At Accounting/Inventory Voucher creation
voucher and alteration screen
F10 (Ctrl+F10) To select the Memorandum At Accounting/ Inventory /Payroll Voucher

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 voucher creation and alteration screen
F11 To select the Functions and At almost all screens in TALLY.ERP 9
Features screen
F12 To select the Configure screen At almost all screens in TALLY.ERP 9
F1 De-activate the Company The company still exists but its name will
be excluded from the list of selected
companies.

A Group is a collection of ledgers which have similar transactions. For example, all ledger
account heads relating to the fixed assets of company are grouped under Fixed Assets
primary group in Tally.
In the current way of accounting, all financial entries are performed using ledgers or account
heads. It is advisable to Group / Classify ledger information based on their functions. Groups
are helpful in classifying and identifying account heads based on their nature. Grouping
helps in presenting summarized information. Regrouping of accounts is also permitted by
Tally ERP 9. At the highest level of grouping, accounts are classified into Assets, Liabilities,
Income and Expenditure.
Groups by Default (Pre-defined Groups): Tally ERP 9 provides you with 28 predefined
Groups to save you from unnecessary burden of creating frequently used Groups. Out of
these 28 Groups, 15 are Primary Groups and 13 Subgroups. Subgroups are a part of the
main group.
There are 28 pre-defined Groups in Tally. ERP 9, out of which 15 are Primary Groups and 13
are Sub-Groups.
List of Account groups in Tally:
Sl.No. Name of the group Purpose
1. Capital Account All Capital Accounts and drawing Accounts
2. Loans (Liability) All types of loans taken by the firm.
3. Current Liabilities BOD, Outstanding Expenses, Advance income
4. Fixed assets All fixed assets (Tangible and Intangible)
Various Investments made by the firm outside (shares,
5. Investments
bonds, debentures)
6. Current Assets Prepaid expenses, accrued income
7. Branch / Divisions Firms branches and divisions accounts
8. Misc. Expenses (Asset) Petty Expenses made in advance
9. Suspense account A temporary account used for rectification of errors.
10. Sales Account Stock sales and sales returns (Cash & Credit)
11. Purchase Account Stock purchase & purchase returns (Cash & Credit)
Incomes associated with firms main, activity other than
12. Direct Income
sales.

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 Expenses associated with firm’s main activity other than
13. Direct Expenses
purchases.
14. Indirect Incomes Incomes of a firm other than sales.
15. Indirect Expenses Expenses other than purchase and Direct expenses.
16. Reserves and Surplus Portion of profits set aside for General or specific purpose.
17. Bank OD A/c All bank current accounts of the firm.
18. Secured loans Loans raised by Mortgage of asset.
19. Unsecured loans Loans raisedwithout Mortgage of asset.
20. Duties and Taxes GST, Local, Taxes, Export, Import, Duties,VAT…
Provision for bad debts, doubtful debts, discount,
21. Provisions
depreciation.
22. Sundry Creditors All creditors of stock supply, Bills payable
23. Stock-in-hand Closing stock, OPENING STOCK
Various deposits made by the firm in banks and other
24. Deposits (Assets)
Institutions.
Loans & Advances
25. Loans & Advance given by the firm.
(Assets)
26. Sundry debtors All debtors out of credit sales and bills receivables.
27. Cash-in-hand Cash accounts of the firm
28. Bank accounts All bank accounts of current and saving nature

Deleting a group:
Go to Gateway of Tally > Accounts Info > Groups > Single/Alter
The Delete function is performed through the single alteration mode. You cannot delete
groups from the Multiple Alteration mode.
1. Select the Group to be deleted.
2. Press Alt+D to delete.
Note: You cannot delete a group if it is a reserved group or a group that has sub-
groups or ledgers in it. A new group created under primary will not be reflected in reports
until you pass masters/transactions for that group.
Ledger:
A Ledger is the actual account head to which you identify a transaction and must be used in
all Accounting Vouchers. Without a ledger we cannot record any transactions.
Ex: Purchase, payments, sales, Receipts, etc, all these accounts heads are ledger Accounts.
All Ledgers have to be classified into Groups. Classification of Ledgers to the appropriate
groups is very important. These Groups and Ledgers are classified to Profit & Loss or Balance
Sheet.

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 UNIT II: MAINTAINING STOCK KEEPING UNITS

Inventory Management:
Any business, like manufacturing, trading, sale and service of products, that deals with stock
has found immense value in inventory management. Staying on top of inventory will
increases revenue, customer satisfaction, and efficiency of the organization.
Inventory management in Tally.ERP 9 helps you track your orders to completion, helps you
see through your current stock, evaluate your orders, both sales and purchases and tell you
exactly what your stock requirement is. Maintain shelf space efficiently by giving fast selling
goods the priority they deserve on the shelf.

Inventory features:
Stock Management: Stock management is imperative for the success of any business
involving inventory. With Tally.ERP 9, you can create as many stock items as you want, and
classify them in respective groups for easy sorting and identification.
Virtual location created by default, keeps record of the stock of inventory. Your business
may require storing inventory in multiple locations. Warehouses, shelves, racks, bins, or a
job worker's location, wherever your stock is, create the location in Tally.ERP 9, and track
location-wise movement of your goods. Tally.ERP 9 gives you the flexibility to do so with
ease.
When dealing with inventory, handling units of measure becomes almost inevitable. Real
time complexities like the requirement to buy in one unit, and sell in another can be a road
block. However, Tally.ERP 9's flexible units of measure to the rescue!.

Stock Journal: When you have inventory in different godowns, or branch locations, you can
utilise goods from one location for a consignment or sale in another location to make up for
shortages without purchasing new stock. Your inter project or site transfer of goods can be
recorded using stock journals. Create a voucher class for recording the transfer of materials
from one location to another or within the same branch or godown, and record transfer of
goods in no time. Transfer of materials impact only the books of inventory, updating the
godown wise stock. Verify if your stock transfer entries are accurate using the Transfer
Analysis report.
Physical Stock Entry: When doing a physical stock count, mismatch between stockin-hand
and the inventory books is not a rare event. Now adjust the stock difference using Tally.ERP
9's Physical Stock voucher. Physical stock quantity will be displayed as actual stock in the

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Stock Summary from the date of entry of the physical stock. Analyse the stock adjustments
made in a specific period, with the reasons for difference.

Multiple Stock Valuations: Stock, whether raw materials, finished goods, or byproduct is an
asset to the company. The value of your stock is one of the factors that contribute to the
organization's financial health. Ascertaining stock value appropriately is therefore critical.
Overvalued stock shows exaggerated profits, while underrated stock could show your
company in the red. To project the financial status appropriately, choose the most suitable
stock valuation method for your business. Use Tally.ERP 9 to value your stocks based on the
cost of the products or the market price of the product. Further you have different costing
methods like FIFO, LIFO, At Average Cost, Last Purchase Cost, and more to choose from.
Select from one of the four market valuation methods. Display your balance sheet with
columnar display of stock values using different valuation methods to do a comparative
study or evaluate the closing balance in different valuation methods in the Stock Summary
report.
Inventory Reporting: For most businesses inventory is their primary source of revenue.
Inventory reporting gives you critical insights into the effectiveness of your buying and
selling, cost of operations, and storage. Strong inventory reports form the basis of important
business decisions like procuring fast moving items, sustaining trade relationships with
vendors and customers, developing strategies to increase your business turnover, and
maintaining optimal levels of inventory to avoid stock outs.
Transactions entered in Tally.ERP 9 are immediately posted into relevant books and register
thus facilitating availability of real time inventory data for instant decision making.
The details of your stock-in-hand on any given date, dynamically updated and presented in
the form of stock summary. View the stock flow of goods, the profitability and consumption
details from this report.
Monitoring stock levels will save you from surprising stock outs and meet customer
demands promptly.
Use the Item Cost Tracking feature of Tally.ERP 9 to analyses the running cost and
profitability of the stock item through sales, purchases, and all other transactions.
Track procurement, landing, manufacturing, and order costs pertaining to the stock item.
Use this powerful capability to give you a strong basis for your pricing decisions.
Stock Groups:
Stock Groups are provided to help in the classification of stock items. Classification is done
based on some common behavior. Grouping stock items makes it easy to identify and report
them in the statements. For example, items of a particular brand can be grouped together
so that you can get the inventory details of all the items of that brand.

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Creating Stock Group:

i. Create the Stock Group � Television under Primary.

Go to the Gateway of Tally > Inventory Info. > Stock Groups > Create (under the
Single Stock Group).
Press Y or Enter to accept the screen.
Similarly, create Music Systems under Primary.
Create Sony TV under Televisions.
Press Y or Enter to accept the screen.
ii) Creating Multiple Stock Groups
Go to the Gateway of Tally > Inventory Info. > Stock Groups > Create.
Create Accessories and Components under Peripherals.
Ensure that the Multi Stock Group Creation screen is displayed as shown below:

Stock Categories
This is a feature, which offers a parallel classification of stock items. Like Stock Groups, Stock
categories are also classified based on some similar behaviour. The advantage of using
Tally.ERP 9 lies in categorising Stock items together, (based on functionality) across different
stock groups. This enables you to obtain reports for alternatives or substitutes of a stock
item.
Set Yes to Maintain Stock Categories in F11: Features (F2: Inventory Features) to get an
additional option Stock Categories under Inventory Info.

Go to the Gateway of Tally > Inventory Info. > Stock Categories > Create.

Stock item
Stock items are goods that you manufacture or trade (sell and purchase). It is the primary
inventory entity. Stock Items in the Inventory transactions are similar to ledgers being used
in accounting transactions. Therefore, Stock Items are important in an inventory just as
ledgers are important in accounting.
Go to Gateway of Tally > Inventory Info. > Stock Items > Create.
The Stock Item Creation Screen appears as shown below:
Enter the following details:

• Name: The name of the stock item.

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 • Under: The stock group under which you want to classify the stock item.
• Category: The stock category you want to classify the stock item for parallel
classification.
• Units: The unit of measure for the stock item being created.
• Rate of Duty: Enter the rate of duty charged on the item.
• Opening Balance: The opening balance of a stock item, refers to the stock available
with us. Godowns that have already been created, must have the opening balance
quantity and the location specified.

Inventory Vouchers

• Inventory Vouchers perform the function in the inventory system that accounting
vouchers do in the accounting system. Inventory Vouchers are also means of
entering transactions. Accounting vouchers will update only Accounts, but Inventory
vouchers will update both Accounts and Inventory. Inventory vouchers record the
receipt and issue of goods/ stock ( Movement of goods), the transfer of stock
between locations and physical stock adjustments.
Set the option Integrate Accounts and Inventory to Yes in F11: Features : F1:
Accounting Features/Inventory Features.
• You can trace a transaction from the beginning i.e., goods transfer stage to the
financial accounting stage irrespective of integration status.
• For example, the purchase of stock can be tracked from the purchase voucher
through the receipt note, through invoice from the supplier and also through
eventual payment.
Standard Vouchers
Tally.ERP 9 is preprogrammed with a variety of Inventory Vouchers, each designed to
perform a different job, Some of them are available after configuration (F11). This
voucher is available from:
Standard vouchers are as follows:
1. Delivery Note: This is available after configuring F11 feature of tracking
number. It is useful for delivery of materials to customers, agents, third Party or any
other delivery of material.
2. Physical Stock: It is useful for physical stock verification.
3. Purchase Order: This is available after configuring F11 feature of tracking
number. It is useful for placing order to the vendor for purchase of materials.
4. Sales Order: This is available after configuring F11 feature. It is useful for
accepting order from a customer for the sale of materials.
5. Receipt Note: This is available after configuring F11 feature of tracking
number. It is useful for receiving back of materials returned by the customer, agent,
third party etc.
6. Rejection In: This is available after configuring F11 feature of tracking
number. It is useful for receiving back materials returned by the customer, agent,
third party etc.

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 7. Rejection Out: This is available after configuring F11 feature of rejection
note, it is useful for returning back of materials to the supplier, agent, third party,
etc.
8. Stock Journal: Records stock transfer and stock used in
production/manufacturing.
Godowns in Tally
Godowns is a location where stock items are stored safely

How to maintain multiple godowns in Tally.ERP 9

In Tally, apart from creating a single godown, one can also create multiple godowns by
specifying the name of parent group. Perform the following steps to create multiple
godowns:

Step 1 : Select the Create option under Multiple Godowns from the Godowns

Step 2 : Select the godown name from the list of Godowns menu, besides the
Under Godown.

Step 3 : Type the name of the sub godowns under the Name

Step 4 : Finally, click Yes to save multiple godowns and the multiple godown
screen appears

How to see godown wise stock in Tally

After creating multiple godowns, one can view the details of stock godown wise, by using
the display option. One may just need to perform the following steps to display multiple
godowns or to see godown wise stock in Tally.

Step 1 : Select the Display option under Multiple Godowns from the Godowns and
the List of Godowns menu appears.

Step 2 : Select the godown whose details you want to view from among the List of
Godowns maintained. Now the Multi Godown Display screen appears,
displaying the details of the selected godown.

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How to disable multiple godown in Tally.ERP 9

To dis-functionalize multiple storage location in Tally .ERP 9 follow the given directions.
Starting Point: Gateway of Tally
Choose Destination: Multiple Godowns

Directions to disable multiple godown in Tally

Go to Gateway of Tally > F11: Features > Inventory Features.

Set Maintain Multiple Godowns/Excise Units? to “No”

Press Ctrl+A to accept

How does godown transfer in Tally

Tally.ERP 9 allows transferring materials from one Godown to another. The transfer of
materials is done using Stock Journals. Tally.ERP 9 also provides you with the facility to
create voucher class, which help in simplifying the transfer of materials between godowns.

To transfer materials (Stock Transfer)

• Step 1: Go to Gateway of Tally Inventory Vouchers and

• Step 2: Press Alt + F7 (Stock Journal) and then select Stock Item in Source column
and the Godown particulars
• Step 3: Select Stock Item and Godown particulars in Destination column.

To transfer materials using Voucher Classes

Step 1: To create Voucher Class -

• Go to Gateway of Tally > Accounts Info/lnventory Info. > Voucher Types > Alter
>Select Stock Journal, tab down to Name of Class field and specify Class name (e.g.
Godown Transfer)
• Set Use Class for Inter-Godown Transfers to Yes

Step 2 : Create Stock Transfer Journal Voucher -

• Go to Gateway of Tally > Inventory Vouchers > Alt+ F7 (Stock Journal) Select Godown
Transfer Class from Voucher Class List
• Select Destination Godown details, stock items, Source Godown

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 UNIT –III: Recording Day to Day Transactions in ERP
Accounting Vouchers:
Vouchers are used for recording the transactions. Tally provides predefined vouchers with
different formats for different types of transactions.
Voucher Classes are available for all major voucher types like:
1) Contra
2) Payment
3) Receipt
4) Journal
5) Sales
6) Credit Note
7) Purchases
8) Debit Note
9) Sales Order
10) Purchase Order
11) Delivery Note
12) Stock Journal
1. Contra Voucher: To transfer funds between cash and banks Press F4 to get this
Contra entry screen. The Contra Voucher can be recorded using Single entry mode or
Double Entry mode.
2. Payment Voucher:
Classification of Payment Transactions
a) Cash Payment: Cash payments are the transactions that settle through cash.
Payments are made by cashier through immediate cash.
b) Bank Payment: These are transactions that settle through bank or by way of issuing
cheque.
3. Receipt Voucher: The Purpose of this voucher is to record all receipts into Bank or
Cash Accounts. Such receipt from Debtors, any income, refund of loans or advances
given earlier, sales of fixed assets, etc. Based on the nature, we can classify the
receipt transactions into two.
Cash Receipt: A Cash Receipt is the one, when transaction is settled through cash or money
receiving through cash.
 Bank Receipt: Bank receipt are the amount received through bank using
instruments like check, DD, online transfer like NEFT, RTGS etc.

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4. Journal voucher (F7): It is for adjustment between any two ledgers. No outside
parties, like Debtors, creditors, Branches / Divisions are involved. These are for
rectification entries in which as any kind of adjustment for non-cash or bank
transactions are recorded here.
5. Sales Voucher (F8): This Voucher records all entries related to Sales including Cash
& Credit. We need to enter the item details of Inventory value gets effected due to
sales. The entries for Cash sale are automatically entered in the Cash Book or Bank Book.
Credit Note Voucher (Ctrl+F8): Credit Note are used for giving credit to the party. For
example, when a buyer returns the goods (Sales Return) or allows himself credit due
to rate difference or Discount or Due to some adjustment.
This voucher type will be available after configuration of F11 features.
How to Activate Credit Note in tally epr 9?
We should go to the following screen.
F11 Features > Inventory Features
F 11 Inventory features are available from almost all screens of Tally.
 Enable Use debit and credit notes
 Record credit note in invoice mode: Sets yes of required
7. Purchase Voucher (F9): This Voucher records all entries related to Purchase
including Cash & Credit. You need to enter the item details if inventory value gets effected
due to Purchases. The entries for Cash Purchase ar automatically entered in the Cash book
or Bank book.
8. Debit Note: Debit Notes are used for Debiting party accounts, for example, in case of
purchase return or when supplier has granted you credit due to different reasons.
This Voucher type will be available after configuration of F11 Features.
Debit Note also Used When
1) Any expenses met by us on behalf of any parties (Sundry Dr and Sundry Cr).
2) When there is a price difference in invoice.
3) In case of bulk purchase schemes, normally seller raise scheme for bulk
purchase in a particular time frame. If the buyer achieve such target, A
special rate will be allowable. In such case buyer will issue a debit note
debiting supplier account in return of a credit note by seller.
4) When Discount received from seller.
9. Sales Order Voucher: When the order is received from a customer for goods to be
supplied, the Items, quantities, date of delivery, etc., details are given with Sales
Order Number. Later when these goods are delivered, this Sales Order is tracked for
the order Details either in the delivery note or in the sales invoice.
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 The Outstanding Sales Order reports are available in Tally.ERP 9. It is possible to
know the order position of any item in the Stock Summary. Separate Sales Order
Outstanding report and Sales Order Summary report are also available.
Creating a Sales Order
Sales order entry is exactly like the Purchase Order Entry. Sales Order details will also
depend on configuration settings.
To create a Sales Order,
Go to Gateway of Tally > Inventory Vouchers > press Alt + F5 or click on Sales Order
10. Purchase Order Voucher: When the order is placed with the suppliers for the supply
of goods, the Items, quantities, date of receipt etc., details are given with the
Purchase Order Number. Later, when these goods are received, the
Purchase Order is tracked for the Order Details either in the receipt note or in the
purchase Invoice. The Outstanding Purchase Order reports are available in Tally.ERP
9.
It is possible to know the order position of any item in the Stock Summary. Separate
Purchase Order Outstanding report and Purchase Order Summary report is also
available.

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 UNIT-IV : Accounts Receivables and Payable Management

Accounts Payable

Accounts payable is any sum of money owed by a business to its suppliers shown as a
liability on a company's Balance Sheet. In simple words, when you buy goods or services
with an arrangement to pay at a later date, such amount till it is paid is referred to as
accounts payable.

Accounts payable is also called as bills payable and the total amount that a company is liable
to pay is shown as liability under the head sundry creditors in the balance sheet.

Motives for managing accounts payable and accounts receivable

1. Establish credit policies. One thing owners and managers don't like about transactions is
when they take a long time to close. ...
2. Shorten transaction cycles. ...
3. Foster more communication. ...
4. Stay on top of aging accounts. ...
5. Use automation to track everything.

Need for payable management

Any business, whether manufacturing or trading, need to procure the goods or services
from their suppliers and most times, you will be offered to pay on a later date. This results in
a major source of cash outflows towards the trade payable and therefore businesses must
manage it efficiently.
While accounts payable are short-term liabilities that need to be honoured within a specific
date, any delayed payment will attract additional charges in the form of interest and later
payment charges. Also, delayed payment may create ill-feeling and impacts the credibility of
the business which in turn leads to disruption of the supplies.
Accounts payables involve a carrying cost, not just the additional charges for delayed
payments but also the other form of cost. Find out by reading Cost of Payables.
Accounts payable process

An accounts payable process has many moving parts, potentially manual process steps, and
multiple people across the organization involved.

The accounts payable process starts right after you have decided to procure the goods or
services on a credit basis. The following is the accounts payable process that you get to see
in most of the business

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 • Evaluating the credit policy of the supplier in terms of credit days allowed, delayed
payment charges, cash discount on early payment etc.
• Finalize the supplier and procure the goods in accordance with the procurement
process followed by your business
• Once the goods are received, account the invoice in the books
• Need to pay special attention to record the due date within which the bills need to
be paid
• Track the bills that are nearing the due date and plan to clear. Accounts payables and
the ageing report will be of great help here
• Account the payments made in the books and it will good practice to keep a track
the invoices against which the payments are honoured
• Send the acknowledgements such as payment advice or any other statement to
inform the supplier about the payment that is made.

Taking full advantage of the credit days will help you to manage the cash flow efficiently.
While it is easy but not tracking and knowing when to honour bills will prove to be a
disadvantage to the business.

Accounts Payable vs. Accounts Receivable

Sound management of accounts receivables and accounts payables is crucial to assess a

company’s financial health. While the two types of accounts are recorded in more or less
similar way, it is imperative to keep in mind that one is an asset account and the other is a
liability. Now, with the definition above, it can easily be concluded that accounts receivable
is the money owed to your business by customers whereas, accounts payable is the money
you owe to the suppliers. This gives us a clear understanding of which account is recorded
under what criteria in the financial statement of a company. Since accounts receivable is the
money owed to you, this will be recorded under assets, and since accounts payable is the
money you owe, this will be recorded under liabilities.

Accounts receivables

Management of receivables refers to planning and controlling of debt owed to the customer
on account of credit sales. In simple words, the successful closure of your order to sales is
determined only when you convert your sales into cash.
How to record accounts receivables:

The following are journal entry to account and adjust the accounts receivables in the books
of account

When a sale is made on credit

Deepak Sales Corporation (Customer) 4,83,800

Cr Sales a/c 4,83,800

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When a sale bill is paid

Dr Bank/Cash a/c 4,83,800

Cr Sundaram Pipes and Fittings a/c 4,83,800.

Bill wise Accounting

Bill wise Details' hence can be used to track the details of any already made or due
payments and also to generate payables or receivables reports with minimum effort.

Types of Bill wise details in Tally.ERP 9

There are four types of bill wise detail.

New Reference This is used at the time of passing sales and purchase entries
which will later serve for Against reference entries to be passed
under Sundry debtors and creditors ledger.
Against Reference This reference is used when we pass receipt entries or payment
entries against the references created at the time of passing of
original entries such as sales and purchase.
Advance This reference is used when any amount is received in advance
for any services rendered or for any outward supplies of goods
is made or when any amount is paid in advance for purchases to
be made at the future date.

In other words, this type of bill wise detail is maintained where

the nature of service or nature of product or terms of business
demands advance receipts/ advance payments to be made and
to track these when the business gets materialized at the time
of raising of bill or invoice, these entries would serve as
reference.
On Account An interest receipt entry, interest payment entries uses these
types of references. But apart from these, this type of reference
is also used when we are unsure of as of against which bill the
sum has been settled by the debtor.

So, all those types of entries are kept under this reference till
the time it gets cleared as to which Invoice the sum relates to.

Benefits of maintaining Bill wise details

• To easily maintain/generate outstanding reports of Receivables and Payables

• To maintain & track Accounts Receivable and Accounts Payable based on every bill
• Helps in generating Age wise analysis report for receivables and payables

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Procedure o activate Bill wise Accounting

It just takes few steps to activate this feature in Tally.ERP 9

Step 1: To set Maintain Bill wise Details to Yes in F11: Accounting Features
window
Step 2 : To create a Party (Ledger A/c) under Sundry Debtors / Sundry
Creditors group
Step 3 : To set maintain balances bill by bill to Yes for the parties during ledger
creation
Step 4 : From Gateway of Tally > Accounting Vouchers > Sales (F8) or Purchase
(F9) accordingly and enter the transaction by specifying a Bill reference
No. along with due dates for the amount to be received or paid in the Bill
Allocations for the screen (we can also break up the amount into multiple
reference numbers with different due dates)
Types of Bill wise summary report in Tally.ERP 9

Generally, to view Receivables / Payables Reports, we have to proceed to Gateway of Tally >
Display > Statement of Accounts > Outstandings > Receivables (to view due to the
company). This report displays a bill by bill outstanding for all the parties with the pending
amount along with the due date.

Report Type Description

Individual party wise – Bill wise Select Ledger in the Outstanding menu
outstanding
We will now get a report displaying bill-by-bill details
of all outstanding for the concerned party along with
the total outstanding amount
Group Outstanding report – Bill wise To View Group Outstanding Report, select Group in the
outstanding Outstanding menu and then select the specific group
or sub group
Ageing analysis report – Bill wise We can also view Ageing Analysis of Outstanding, by
outstanding defining various ranges of periods and view
outstanding across the specified time slabs

Such as 0 to 30 days, 30 to 45 days and 45 to 75 days

and so on

To View Ageing Analysis Report , go to Gateway of

Tally > Display > Outstanding > Receivables or
Payables

Select F6 (Age wise)

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 Specify Ageing Methods and the Periods

Bill wise accounting for Non – Trading accounts

Maintaining details of every bill for trading accounts is possible in Tally.ERP 9 using Bill wise
Details. The same powerful and convenient feature is available for tracking and managing
non- trading accounts like Loans, Advances and Installment Payments etc. as well.

Using this feature, business owners can easily track bills for expenses, any installments to be
paid or loan amounts to be received. ‘Bill wise Details’ hence can be used to track the details
of any already made or due payments and also to generate payables or receivables reports
with minimum effort.

How to activate:

Go to Gateway of Tally > Press - F11: Accounting Features > Set ‘Yes’ to ‘Maintain Bill wise
Details (for Non-Trading A/c s also).

Creation of new books and import the data

If you wish to create a new company, export the closing balances of the ledgers and stock
items of the previous company, and import them as opening balances in the new company.
This helps you to clean your data by removing redundant masters such as inactive ledgers,
obsolete stock items etc.

• To create new books of accounts:

o Click 'Company'option available in the top menu.
o Select 'Create' and mention the company details
o Enter 1-4-2021 as the Financial year begins from

• To export closing balances from Previous F.Y company:

o Click 'E: Export' option available in the top menu or press Alt + E
o Select Masters
o Click on Configure
o Press Enter to enable ‘Export closing balance as opening’
o Mention the closing balance date and press ESC to go back
o Press Enter on Send to export the details in XML file

• To import closing balances as opening balances in the new company

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 o Click 'O: Import' option available in the top menu or press Alt + O
o Select Master
o Mention or select XML file location ( E.g. C:\TallyPrime\Master.xml)
o Select ‘Modify with New Data’ in Treatment of entries already existing
o Press Enter to import

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 UNIT-V: MIS REPORTS

MIS Reports are reports required by the management to assess the performance of the
organization and allow for faster decision-making.

MIS Reports are reports required by the management to assess the performance of the
organization and allow for faster decision-making.

You can view the following types of MIS Reports in Tally.ERP 9:

● Accounting Reports: To obtain information on the financial position, operational
performance and economic activities of the business.
● Financial Reports: To determine the financial condition of an organisation as required by
shareholders, creditors and government units.
● Inventory Reports: To manage the Inventory effectively since the actual status of stock
items is obtained.
● Management Control Reports: To utilise budgets, cost centre reports, scenario reports
etc. for controlling activities.

Bills Receivable and Bills Payable

A bill of exchange can be either bills receivable or bills payable. When a drawee accepts a
bill and sends it back to the drawer, it becomes a bills receivable to the drawer as money
is receivable on the bill. Therefore, it becomes an asset to him. On the other hand, it
becomes a bills payable to the drawee if money is payable by him on the bill, in which
case it is a liability for him.

The drawer can make use of the bill in one of the following ways:
1. Retain the bill till the date of maturity and collect the money from the drawee.
2. Endorse the bill to his creditor.
3. Discount the bill with the banker.
4. Send the bill to the banker for collection.
Procedure to view Bills Receivables

Bills receivable is a bill of exchange on which payment is expected to be received at a

later date. Bills receivable report in Tally.ERP 9 displays all the outstanding receivables
during a specified period.
Go to Gateway of Tally > Display > Statements of
Accounts > Outstandings > Receivables
This report displays all outstanding receivables invoice-by-invoice, till date. This report
takes into consideration only those party ledgers for which the option Maintain
balances Bill-by-Bill option is enabled.

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 ● Date : This is the Effective date of the invoice and not the actual date. Hence, if your
invoice date is 15th November but the effective date is 30th November, and then 30th
November will be displayed here. Credit period is calculated from the effective date.
● Reference Number : This is the bill reference number entered in the Bill-wise
Details screen.
● Party's Name : The party ledger name appears in this field.
● Pending Amount : This is the outstanding balance on a particular invoice. To see the
breakup, press Shift + Enter. To view the complete breakup of all the bills, press
the F1 : Detailed button. This view toggles with the button F1 : Condensed.
● Due On : This is the due date of the bill (with reference to the Effective date)
specified during voucher entry.
Button options in Bills Receivables report
1. ● F1 : Detailed : Click F1 : Detailed button or press Alt+F1 key to display details
such as Voucher Date , Voucher Type(s) , Voucher Number(s) , and Amount of
each voucher.
● F2: Period : Click F2: Period button or press F2 key to change the period.
● F4: Payable : Click F4: Payable button or press F4 key to display the bilaa payable
report
● F6: Age wise : Click F6: Age wise button or press F6 key to display the Age wise
analysis of the Bills Receivable report. ● F7 : Bill-Party wise: Click F7 : Bill-Party
wise button or press Alt+F7 key to display the party-wise breakup of the Bills
Receivable report.
Details of F12: Configuration options are given below:
2. Include Post-Dated Transactions : Set this option to Yes , to display the
column Post-Dated Amount in the report.
3. Show Bills n Foreign Exchange : Set this option to Yes , to view the transactions
that are recorded using foreign currency.
4. Show Opening Amount: Set this option to Yes , to display the
column Opening Amount in the report.
5. Show Due On : Set this option to Yes to display the column Due On in the report,
and the due date for each transaction is captured here.
6. Show Overdue days/ Age of Bill in Days : Set this option to Yes to display the
column Over Due by Days . This will display the total number of days for which the
bill has been due for.
7. Range of Bills to show : Filter the records in the bills in the report by Pending
Bills or Over Due Bills .
8. Show Order Number in Detailed Format : Set this option to Yes to display the order
numbers of the transactions, when viewed in the detailed mode.

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 9. Show Qty Info in Detailed Format : Set this option to Yes to display the stock item
name, quantity and rate in the detailed view of the report.
10. Show Narrations also : Set this option to Yes to view the voucher narrations in the
report when viewed in the detailed mode.
11. o Appearance of Names: Select a display name style for ledger names.
12. o Sorting Method : Sort the report by selecting a suitable sorting method.
13. ● F12 : Range : Click F12 :Range or press Alt+F12 to use the Range Filter option to
search for specific bills from the list of bills outstanding. Users may filter the
transactions based on
the Date , Original Amount , Pending Amount , Ledger , Reference number and so
on

Ratio Analysis Report

Ratio analysis is a powerful tool for financial analysis. A meaningful analysis of a financial
statement is made possible by the use of ratios.Ratios are a set of figures compared with
another set. The comparison gives an understanding of the financial position of a
business unit. There are a number of ratios which can be computed from a single set of
financial statements. The ratios to be computed depend on the purpose for which these
ratios are required. A single ratio may sometimes give some information, but to make a
comprehensive analysis, a set of inter-related ratios are required to be analysed.
To view Ratio Analysis Report
The Ratio Analysis Report is divided into two parts, Principal Groups and Principal Ratios.
The Principal Groups are the key figures that give perspective to the ratios. Principal
Ratios relate two pieces of financial data to obtain a comparison that is meaningful.
● Go to Gateway of Tally > Ratio Analysis . The Ratio Analysis screen will be
displayed

Cash Flow in Tally.ERP 9

Cash Flow is the inflow and outflow of cash during an accounting period.

A cash flow statement concentrates on the transactions that have a direct impact on
cash. It deals with the inflow and outflow of cash between two Balance Sheet dates. That
is, it explains the changes in cash position between the two periods. Here the
term cash stands for cash and bank balances. Cash flow statements can also be used as
receipts and payments statement. This is particularly useful for businesses such as Non
Profit Organizations where receipts and payments statements need to be generated.
1. Go to Gateway of Tally > Display > Cash/Funds Flow > Cash Flow .
For Quarterly Cash Flow statement:
● Change Period by pressing F2: Period and set the period, e.g., 1-4-08 to 30-06-
2008.
● Select the option Auto Column from the button bar.

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 ● You can also select Quarterly (or Monthly or any other period) from the list.

Funds Flow Statement in Tally.ERP 9

A Fund Flow statement is a report, which explains the movement of funds during an
accounting period.

This statement consists of two parts

● Sources of funds
● Application of funds
The difference between the two shows the net change in the working capital during the
period. Only those transactions that affect the net working capital of the firm, find place
in this statement.
The Fund Flow statement is a supplement to the two principal financial statements.
While supplementing the position statement, it describes the sources from which
additional fund were derived and for which these funds were used. The transactions,
which increase working capital, are sources of funds and the transactions, which
decrease working capital, are application of funds.
To view Funds Flow Report:
1.Go to Gateway of Tally > Display > Cash/Funds Flow > Funds Flow .
A Monthly Funds Flow Summary with the movement of working capital for each month
is displayed. It shows the Opening and Closing Balances of each month with a
column for Funds Flow.
Press Alt+F2, to change period.
Select a month and press Enter to drill down.
Select F1: Detailed to see the funds flow for the selected month.

Exception Reports
Exception Reports track unusual transactions or balances.
● Go to Gateway of Tally > Display > Exception Reports

The following reports can be seen:

● Negative Stock

● Negative Ledgers

● Overdue Receivables

● Overdue Payables

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 ● Memorandum Vouchers

● Reversing Journals

● Optional Vouchers

● Cancelled Vouchers

● Post-dated Vouchers

● E-Mail IDs

● Excise Dealer
Tally.ERP 9 creates the books of accounts and the financial statements based on the
vouchers entered till date. We can then customize the appearance of reports as required.
For example, you can compare different companies, periods of the financial year, groups
and ledgers.
Press Enter after highlighting the item in a report, to navigate to the next level of detail till
you reach an individual voucher. Similarly, you can navigate back to higher levels by pressing
Esc. The special features available for a displayed report are indicated on the button bar,
which can be operated by a single- click of the mouse.
Display Registers & Books in Tally
The Gateway of Tally menu provides access to all the financial reports listed in the Display
Menu.
For example, if you want to view the Sales Register,
Go to Gateway of Tally > Display > Account Books > Sales Register.
Tally.ERP 9 will display the report for the currently selected period.
In Tally.ERP 9, as soon as the transactions are entered they are immediately posted to the
respective ledgers, books and registers thereby facilitating instant reporting and faster
decision making.

Books of account
Books of account record the transaction details as entered. Although items are posted too
many different ledgers, Tally.ERP 9 brings all the transactions of a particular category
together into a book of account for viewing and printing. For example, Cash Book records all
the transactions affecting cash and the Sales Book records all sales transactions.
Let us see some typical examples of how to display the books of account and registers. You
will then be able to experiment with other Books for yourself.

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More:
Day Book
Sales Register (Sales Day Book)
Purchase Register
Cash Book
Bank Book
Journal Register
The Day Book
The Day Book lists all transactions made in a particular day and by default displays the last
voucher entry date of a regular voucher. It could also be set up to list all the transactions
made over a certain period. Transactions include all financial vouchers, reversing and
memorandum journals as well as inventory vouchers.
In Tally.ERP 9, the Day Book is by default displayed for the current date (as on the last date
of voucher entry). However, you may specify the required period, as per your requirements.
To view the Day Book,
Go to Gateway of Tally > Display > Daybook

• Press F2: Period on the button bar or press the key Alt+F2
• Specify the required period
Cash/ Bank

• Account Books record individual transaction details that have been entered. Though
the items are posted to different ledgers, Tally.ERP 9 brings together all the
transactions of one category into books of account for viewing and printing. For
example, the cash book records all transactions that affect cash.
• Go to Gateway of Tally > Display > Account Books > Cash/Bank Book(s)
Multi-Column Cash Book
• To display Multi-Column Cash Book, you need to select multiple ledgers and use
Alt+C. By default the Multi-Columnar Cash Book is displayed for the current period.
Press F2 button (Change Period) to display the multi-column cash book for a selected
period.
• Use the New Column button to bring up the Petty Cash book Monthly Summary
along with the discount column monthly summary.
• Press New Column on the Button bar or ALT+C and change the Name of Ledger.
Multi-Column Bank Book

• Tally.ERP 9 allows the facility to compare bank book with cash book or two or more
banks by using the multi-columnar reporting facility. You can compare the

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 information for multiple periods (year, month, or user defined period) for two or
more banks on the same screen, instead of toggling between different periods /
ledgers.
• Use the New Column button to bring up the Cash book Monthly Summary.
• Press New Column on the Button bar or ALT+C and change the Name of Ledger.

Sales book/ Register

Sales Register displays the monthly summary of sales transactions and closing balances. The
list of transactions pertaining to each month can be viewed by selecting that month and
viewing its details. Tally.ERP 9 permits you to change the display according to the
information required.
The period of the report and the content details can be modified. Columnar periodic reports
can be generated using Alt+N: Auto Column button for different periods as shown by the
columnar details list. Tally.ERP 9 also allows you to compare similar data of two or more
companies stored in the same data directory.

Use of sales register

• The periodic turnover can be analysed using the F2: Period button.
• The periodic taxes on such turnovers can be easily computed.
• Errors made while recording the transactions can be easily traced.
• Sales returns during the year can be analysed and timely action can be taken to
remove the undesirable causes.
• Performance analysis of godown, salesperson, sales area etc. can be done with the
help of cost centre and cost category report
Sales register displays the monthly summary of sales made during the selected period.
To view Sales Register,
Go to Gateway of Tally > Display >Account books > Sales Register
Purchase book/Register
A Purchase Register displays the information on the periodic purchases of a business
concern. Purchase register helps in analyzing the details of movement of purchased goods
to various godowns, on the basis of which the stock movement at each godown is
determined.
Go to Gateway of Tally > Display > Account books > Purchase Register

Purchase returns made during a year can also be traced. The parties to whom the purchase
returns have been made and the causes thereof can be analysed to draw conclusions on the
supplier and the quality of purchases made.

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A Purchase Register can be configured using the Ctrl+F12: Value button to view the
following information.

• Actual Quantity
• Billed Quantity
• Date
• Bill Name
• Cost Centre
• Cost Category
• Voucher Number
• Narration
• Stock item
• Godown Name

Ledger
This summarises and displays the outstanding balance information with respect to each
party. Thus, the bill status of a particular party account can be viewed with the help of this
statement. Some of the uses of a ledger outstanding statement are:

• It displays information similar to the receivable and payable outstanding statements,

but with respect to a particular party ledger. Thus, this statement can be put to a
similar use as stated above.
• It facilitates the viewing of the address and contact details of the party selected, by
using the Alt + C button.
• It can be used to generate reminder letters to be sent to the party specifying the
details of outstanding bills. It is one of the very useful features in Tally.ERP 9 used
with the Print Option.

Group
It displays a summarised view of the balances of all the ledgers under a particular group. For
example, Sundry Debtors Group will display all the party ledgers with their account
balances. It can further be drilled down to each account to show the bill-wise outstanding
for that account.
Some of the uses of a group outstanding statement are as follows:

• Summarised information can be viewed and analysed for each group.

• Another group can be displayed in a column using the Alt+C: New Column button on
the screen and comparisons can be made.
• Group details can be printed and submitted as a supporting schedule to the financial
statements.
• The detailed break-up of parties under the chosen group and their pending balances
can be viewed.

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Trial Balance
A Trial Balance is a summary of all ledger balances to check whether the figures are correct
and balanced. Considering that the journal entries are error-free and posted correctly to the
general ledger, the total of all debit balances should equal the total of all the credit
balances.

In Tally.ERP 9, the matching of the Trial Balance is a foregone conclusion since all voucher
entries are in Debit - Credit format and must balance at the entry point.

To view the Trial Balance

Go to Gateway of Tally > Display >Trial Balance.
Profit & Loss Account

The Profit & Loss A/c is a periodic statement, which shows the net result of business
operations for a specified period. All the expenses incurred and incomes earned during
the reporting period are recorded here.

The Profit and Loss Account in Tally.ERP 9 displays information based on the default
primary groups. It is updated with every transaction/voucher that is entered and saved.
The Profit & Loss Account is generated and updated immediately from the date of
opening of books till the date of last entry.
To view Profit & Loss Account
You can view the Profit & Loss account details in Tally.ERP 9 for a specified period.
Note : By default, the Profit & Loss A/c report will be generated as on the date of the last
voucher entry. You can change the date to view the report for the required period.
Go to Gateway of Tally > Display > Profit & Loss A/c .
Click F1 : Detailed to view the Profit & Loss Account in detailed format
Press F2: Period to change the period as required.
The Profit & Loss A/c is in horizontal form, by default. You can view the report in vertical
format by enabling the option Show Vertical Profit & Loss? by clicking F12: Configure .
You can view additional information or toggle to another report using the options
available in the button bar.
Click S : Schedule VI in the Schedule VI Profit & Loss A/c
Configure Profit & Loss Account

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 You can configure the Profit & Loss account details to view it in the required format.
● F12: Configure : Press F12 and set the option Show Vertical Profit &
Loss to Yes to display Profit & Loss Account in the vertical form.
Show Percentages : Set this to Yes to express each line as a percentage of sales
accounts , that is, if you consider sales accounts to be 100%, the rest of the lines
would be a percentage of sales accounts.
● Show with Gross Profit : Set this to Yes to split the Profit & Loss Statement to
show trading profit, which considers only the Cost of Sales and Direct
Expenses . Indirect Expenses are deducted from the Gross Profit to show
the Nett Profit .
Columnar Profit & Loss Account : Select a column to display the Profit & Loss
Account in a different currency . Click C : New C olumn on the button bar or
press Alt+C , to change only the currency, and give the Closing Exchange Rate .
The Profit & Loss Account figures are converted at this rate.
Income and Expense Statement instead of Profit & Loss Statement
Income & Expenditure Statement is suitable for organizations which do not engage in
trading of goods or services. For such organisations, the books of accounts generally
comprise of only the sources of income, and expenditure, earned/incurred during a given
period. This is useful for non-profit organizations such as trusts, educational institutions,
NGOs, hospitals, and so on.
The Profit & Loss Account is displayed according to the configuration set in the
Configuration screen. Set the option Income & Expense A/c instead of Profit & Loss A/c ?
to No to display the groups Direct Income and Direct Expenses in Profit & Loss A/c and
List of Accounts report.
Income and Expenses A/c instead of Profit and Loss A/c can be toggled by
pressing F11 on the keyboard.

Balance Sheet
A balance sheet is a financial statement that reports a company's financial position. This
report shows the balance between the assets and liabilities of a firm. The balance sheet
follows the fundamental accounting equation: Assets = Liabilities + Owner's Equity.By
default, the Balance Sheet report will be generated as on the date of the last voucher
entry. You can change the date to view the report for the required period.
View the Balance Sheet
1. Go to Gateway of Tally > Display > Balance Sheet .
2. Press F12 to configure the Balance Sheet .
3. Press Ctrl+A to accept.
While providing the opening balance in ledgers, an equivalent contrary balance will
appear as Difference in opening balances in order to match the assets and liabilities, or

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 debit and credit balances. The entry passed for the difference will affect the closing
balance, but the Balance Sheet will display the difference in the amount. To balance the
difference in the opening balance, you have to adjust it with the opening balance of
another ledger.
Configure Balance Sheet
● System Configuration : You can configure the options in balance sheet for method
of showing balance sheet, format, and other additional details. Go to Gateway of
Tally > F12: Configuration > General.
Set Use Accounting terminology of to India/SAARC or International under
the Country Details .
If you have activated India/SAARC , the Balance Sheet will display Sources of
Funds, and Application of Funds . And if you have
activated International, the Balance Sheet will display Assets and Liabilities
Show Vertical Balance Sheet : By default, the Balance Sheet screen is displayed in the
horizontal form. However, you can configure the Balance Sheet to appear in vertical form,
by pressing F12: Configure, and setting the option Show Vertical Balance Sheet to Yes .
Show Percentages : Set this option to Yes in the balance sheet configuration screen.
Press Alt+F1 to view the detailed Balance Sheet . In Detailed mode.
Show Working Capital figures : Using this option, you can set Balance Sheet to show working
capital values. Working capital is the difference between current assets and current
liabilities. Set Show Working Capital figures to Yes , to display current assets less current
liabilities.
Display Balance Sheet with Different Stock Valuation Methods
Tally.ERP 9 provides different valuation methods for different stock items which means
you can use different valuation methods like (FIFO, LIFO, Avg Cost, Avg Price, Std. Cost,
Std. Price, and others) for the inventories in the Balance Sheet.
Set Closing Stock Manually in the Balance Sheet
In Tally.ERP 9, the value of closing stock displayed in the Balance Sheet is based on the
costing method defined for each stock item in the stock item master. The general
principle of accounting is to value the stock at purchase cost or market value, whichever
is lower. The value of closing stock can be entered manually.

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