Computerised Accounts — Introduction to Tally Prime

Prerequisites: Module 5 — Adjustment Entries

Learning Objectives

By the end of this module, you will be able to:

• Explain the difference between manual and computerised accounting
• Describe Tally Prime's core features and data structure
• Navigate the Tally Prime interface confidently
• Create a new company in Tally Prime with all the correct settings

Manual vs Computerised Accounting

Before Tally, accountants maintained physical books — Cash Book, Purchase Register, Sales Register, Ledger, Trial Balance — all handwritten, all prone to arithmetic errors, all impossible to search instantly.

What Is Tally Prime?

Tally Prime (released 2020) is the latest version of Tally Solutions' accounting software — India's most widely used accounting application. It is used by over 7 million businesses across 100+ countries.

Brief History

• 1988: Tally 4.5 (DOS-based, basic ledger)
• 2001: Tally 6.3 (Windows, VAT support)
• 2005: Tally 7.2 (inventory, payroll)
• 2009: Tally ERP 9 (comprehensive ERP with GST support added in 2017)
• 2020: Tally Prime (modern UI, multi-tasking, Go To navigation)

Key Features of Tally Prime

1. Accounting — Complete double-entry bookkeeping
2. Inventory — Stock management, multiple godowns, price lists
3. GST — Automatic GST calculation, GSTR-1, GSTR-3B, e-Way Bill
4. Banking — Bank reconciliation, cheque printing, NEFT/RTGS reports
5. Payroll — Salary processing, PF, ESI, TDS
6. TDS/TCS — Automatic calculation and returns
7. MIS Reports — Ratio analysis, cash flow, outstanding statements
8. Multi-currency — For import/export businesses
9. Security — User-based access control, tally vault (encryption)
10. Remote Access — Tally.NET for remote login

Types of Data in Tally

Everything in Tally falls into one of three categories:

1. Masters

Masters are the setup data — created once, used repeatedly in transactions.

• Ledgers (accounts): Cash, Bank, Suppliers, Customers, Income, Expense accounts
• Stock Items: Individual products with unit, rate, HSN code
• Stock Groups: Category grouping for items
• Cost Centres: Departments for expense tracking
• Voucher Types: Custom voucher configurations

2. Transactions (Vouchers)

Vouchers are the daily entries — every business transaction.

• Payment Voucher (F5): Money going out
• Receipt Voucher (F6): Money coming in
• Journal Voucher (F7): Non-cash adjustments
• Contra Voucher (F4): Between Cash and Bank
• Purchase Voucher (F9): Supplier invoices
• Sales Voucher (F8): Customer invoices

3. Reports

Reports are auto-generated from Masters + Transactions — no manual compilation.

• Day Book: All transactions for a day
• Trial Balance: Debit/Credit summary
• Balance Sheet: Financial position
• P&L Account: Income and expenses
• Outstanding Reports: Debtors and creditors
• GST Reports: GSTR-1, GSTR-3B

How Tally Stores Data

Tally stores all company data in a folder on your hard drive. By default:

C:\Users\[Username]\Tally.ERP9\Data\   (old Tally)
C:\Users\[Username]\Tally Prime\Data\  (Tally Prime)

Each company gets a numbered sub-folder (e.g., 10000\, 10001\, etc.). This folder contains .900 files for the company data. Always back up this folder regularly.

Navigating Tally Prime

Gateway of Tally (Home Screen)

When you open Tally Prime and select a company, you land on the Gateway of Tally — the home screen. All navigation starts here.

Gateway of Tally
├── Transactions
│   ├── Accounting Vouchers
│   └── Inventory Vouchers
├── Reports
│   ├── Balance Sheet
│   ├── Profit & Loss
│   ├── Stock Summary
│   └── ...
├── Masters (Accounts, Inventory, Statutory)
└── Company Features (F11), Configuration (F12)

Key Shortcuts

Sunrise Retail — Case Study Application

Sunrise Retail Pvt Ltd — Creating our company in Tally Prime

Step-by-Step Company Creation

Navigate to: Gateway of Tally → Select Company (or F3) → Create Company

Fill in the following details:

Press: Ctrl + A to save the company.

Setting the GSTIN

After creating the company:

Gateway of Tally → F11 (Features) → Statutory & Taxation

Setting Up GST Rates for Products

In F11, also enable:

• Inventory → Enable Inventory
• Maintain Stock Items → Yes
• Integration with accounts → Yes

Tally Interface Tips

The "Go To" feature (Ctrl+G) is Tally Prime's superpower. Instead of navigating menus, just press Ctrl+G and type what you want:

• Type "balance sheet" → opens Balance Sheet
• Type "TechWorld" → opens TechWorld Distributors ledger
• Type "purchase voucher" → opens purchase voucher entry

This is significantly faster than menu navigation.

Multi-tasking: Tally Prime allows you to keep multiple screens open simultaneously. You can be entering a purchase voucher while having the outstanding payables report visible in a side panel.

Practice Exercise

Exercise 1: You are setting up a new company "Lakshmi Electronics" in Tally Prime:

• Location: 12 MG Road, Pune, Maharashtra (411001)
• Financial year: 2025-26
• GSTIN: 27AAACL4567K1ZX (State Code 27 = Maharashtra)

List the 5 most important fields you must fill correctly during company creation, and the values for each.

Exercise 2: Match each Tally shortcut key to its function:

Key Terms

Module Summary

• Computerised accounting eliminates arithmetic errors, generates instant reports, and automates GST returns
• Tally Prime stores three types of data: Masters (setup), Transactions (daily entries), Reports (auto-generated)
• The Gateway of Tally is the central hub — all navigation starts here
• Company creation requires: correct name, state, financial year start date, and GSTIN
• Sunrise Retail is set up in Tally with GSTIN 36AACCS1234A1ZP, state Telangana, FY beginning April 1, 2025
• The Go To shortcut (Ctrl+G) is the fastest way to navigate Tally Prime

Quick Quiz

Test yourself before moving on:

1. In Tally, which type of data is a "Ledger"?

• a) Transaction
• b) Report
• c) Master
• d) Voucher

2. Which shortcut key opens the Purchase Voucher in Tally?

• a) F5
• b) F7
• c) F9
• d) F6

3. Tally Prime's "Go To" feature is accessed by:

• a) Alt + F1
• b) Ctrl + G
• c) F11
• d) Esc

4. When creating Sunrise Retail in Tally, which field determines whether CGST/SGST or IGST applies to transactions?

• a) GSTIN
• b) Company Name
• c) State
• d) Financial Year

Next: Module 7 — Groups and Ledgers — Building the complete Chart of Accounts for Sunrise Retail — every ledger, every group, exactly where it belongs in Tally.