Maintaining Accounts in Tally ERP 9

This blog is a explains in detail how you can create, alter, delete a company in Tally ERP 9, how you can create single and multiple ledger groups and how you can enable GST in Tally ERP 9

This blog includes the following topics:

  • How to start Tally ERP 9?
  • How to create a company in Tally ERP 9?
  • How to alter a company in Tally ERP 9?
  • Pre-defined groups in Tally ERP 9
  • Enabling GST in Tally ERP 9
  • Creating the Group in Tally ERP 9
  • Alteration of Group in Tally ERP 9
  • Deletion of Group in Tally ERP 9
  • Creating the Ledger Account in Tally ERP 9
  • Alteration of Ledger Account in Tally ERP 9
  • Deletion of Ledger Account in Tally ERP 9
  • Multiple Ledger Creation in Tally ERP 9
  • Entering Party GST Details in Tally ERP 9
  • Balance Sheet in Tally ERP 9
Please refer our previous blog Basic Accounting Concepts before you proceed reading this. 

How to Start Tally ERP 9?

On Desktop double-clicking the icon "Tally" you will see the following first screen of Gateway of Tally.

 start tally ERP 9

 

How to create a company?

Shriram Electronics: is a wholesaler & retailer of Electronics goods based in Mumbai (M.S.) they started their business operations in Mumbai from 1st April 2017 Shriram Electronics now need to maintain their books of Account in Tally.ERP 9

Company Info > Create Company > Shown by the following screen.

 

  • Use of Security Control is Set to No.

 

create a company in tally erp 9 

Directory:

This is where your company data will be stored on your system. This field is skipped by default assuming that you wish to create a company in the data path displayed. However, if you want to change it, simply use the backspace key and change it to whatever required.

For example, the default Tally.ERP 9 data directory could be D:\Tally.ERP9\Data

 

Name:

Type here the name of the company, you wish to create.

 

Mailing Name & Address:

The mailing name and address details are picked up for inclusion in any report that needs the company name and address as a heading. For example Balance Sheets, Statement of Accounts.

 

Country:

Select the Country from the List of Countries. The Statutory Features and Base currency symbol are enabled in accordance with the country selected.

 

State:

Select the appropriate state from the predefined list.

 

Pin Code:

Specify the PIN Code (Postal Index Number) of the specified address.

 

Phone No:

Enter the Telephone number

 

Mobile No:

Enter the Mobile Number

 

E-Mail Address:

Give the email address that will be used to email documents, reports and data from Tally ERP 9

 

Financial Year begins from:

Specify the date of the beginning of the financial year for the company. If you specify 1-4-2017 as the date, your financial year will be from April to March (01/04/2017 to 31/03/2018)

 

Books Beginning from:

Specify here the date from which you actually want tally to maintain your accounts. By default, the same date for the beginning of the financial year is taken, but you may give any other date which is later to the date of the beginning of the financial year.

 

TallyVault Password (If any):

TallyVault is an enhanced security system, which allows for the encryption of the company data. Encryption involves converting normally accessible tally information into unrecognizable information, which can only be reconverted by authorized persons.

 

Use Security Control:

Set this to Yes, if you want to initiate a password-protected system to control access to Tally.ERP 9 data. Else, set this to No.

 

Name of Administrator, Password Repeat Password:

Assuming the Tally Vault Password and use security control is set to yes enter the name of administrator, password and repeat in the respective fields.

 

Use tally audit features?

Tally audit allows the administrator or an auditor profile user to track changes in accounting information.

If you wish to use this facility, select Yes. Tally Audit will be available only to the administrator/auditor, through a display of statements of accounts. For more information refer to Data Management in Tally.ERP9

 

Disallow opening in Educational mode?

Set this option to yes, if you don’t want the company to be opened in an Educational mode of Tally ERP 9. Else, set this to No.

 

Base Currency Information (Rs.):

The currency symbol given earlier in the company creation screen is displayed here automatically. Tally.ERP9 uses this currency symbol in reports, wherever necessary.

 

Formal Name:

Formal Name is the full name of the currency specified. The Formal Name for the base currency is set to Indian Rupees for Indian Companies.

 

Suffix Symbol to amount:

For countries, which specify the symbol after the amount (value) the facility is provided. For example, Yen is specified after the amount (1000 Yen) unlike in India where the symbol is specified before the amount.

 

Add space between amounts and symbols

This facility is provided to users who require a space between the amount and the symbol. However, putting a space between the amount and symbol could give an opportunity for misuse in case of cheque printing. Hence, the flexibility to turn this option on and off as required is provided.

 

Show Amounts in Millions:

This is useful for companies, which require reporting the financial statements in millions. This is possible only if allowed multi-currency is enabled in F11: Accounting Features.

 

A number of Decimal Places:

You can specify a value from 0 to 4 to denote the fractional part of the currency. The default value for this is option 2.

 

The word representing amt after the decimal:

Enter the symbol for decimal portion i.e. Paise

 

No. of Decimal places for an amount in words:

You can specify the number of decimal places for printing the amount in words. This number should be equal to or lesser than the number specified in Number of Decimal places field in company creation or currency master screen which will appear in Invoice and Cheque printing screen. For example, if the currency is expressed up to 3 decimal places, the numeric to be printed in words can be restricted to 2 decimal places.

 

Accept? Yes or No

If you press ‘Y’ or Enter than Tally will save all your information you have entered.

 

How to Alter a company?

If you want to make any changes in the company creations then you have to alter the company.

How to alter a company?

Gateway of tally > Alt + F3 (Company Info.) > Alter > Enter > M/s Shriram Electronics.

Tab down to use Security control option and set it to “Yes”

Type in the Name of Administrator: Shiv and password: shiv123

The moment you press enter to save the alteration screen, tally prompts you to enter the “Name of the user and password”

 alter a company in tally

How to shut the company?

From the Gateway of Tally Press Alt + F1 to display Company Info

Select Shut Company option which will display the list of companies.

Select the Company name from the list which you want to Close / Shut.

 

Pre-Defined Groups in Tally

Tally provides a set of 28 predefined groups. Of these 15 are Primary Groups and 13 are Subgroups or Children. When you create the company by default the 2 ledger accounts are opened they are Cash and Profit & Loss A/c so no need to create the ledger again.

 

Branch & Division

This is a primary group which is used to keep the names of all companies which may be branches, division, sister concerns, subsidiaries of the existing company.

 

Capital Account.

This is a Primary group. You can open ledger accounts like Partners Captial A/c. Proprietors capital A/c, Share Capital A/c.

 

Reserves and Surplus

This is a Subgroup. You can open ledger accounts like Investment Allowance Reserve, General Ledger & other such reserve accounts.

 

Current Assets

This is a primary group. All the assets of the company can be placed under this head. This group has 6 subgroups under it. You can place all your assets under these sub-groups.

 

Bank accounts

This sub-group comes under the current asset and you can open saving / current accounts and all other accounts of banks.

 

Cash in hand

This sub-group comes under current asset & you can open ledger account of cash. Tally by default opens one cash a/c under this group. When you can create the new company.

 

Deposits (Assets)

This sub-group comes under current asset & you can open ledger accounts like security deposits, fixed deposits, rental deposits and all other such deposits made by the company.

 

Loans and advances

This sub-group comes under current asset & you can open ledger accounts like loans & advances of non-trading nature. Ex. Advances against salaries, work contracts etc.

 

Stock in hand

This subgroup comes under the current asset and you can open ledger accounts like raw materials, finished goods, and work in progress.

 

Sundry Debtors

This subgroup comes under the current asset and you can open ledger accounts such as goods sold on credit (Customer A/c)

 

Current liabilities

This is a primary group and you can open ledger accounts which are outstanding and liabilities of the company. For eg. PF, TDS, etc.

 

Duties & Taxes

You can open ledger accounts like Excise, Local Sales Tax, central Tax, VAT, MODVAT, etc

 

Provision

You can open ledger accounts that are used to hold other tax provisions like income tax, audit fees, legal fees. Etc

 

Sundry creditors

You can open ledger accounts of trade creditors of the company ex. Suppliers (goods purchased on credit)

 

Direct Income (Income Direct)

You can open ledger accounts of non-trade income accounts that affect gross profit. For eg. Suppose your business is of computer hardware, then all your sales of computer would go under sales account but the account of annual maintenance charges that follow sales of computer would fall under this group.

 

Direct Expenses (Expenses Indirect)

You can open ledger account of those expenses that are done on Purchase of goods of a company and that directly affects its gross profit. For eg. Hamali, transportation, goods inwards charges, octroi, etc.

 

Fixed Asset

This is a primary group, you can open ledger account such as furniture, vehicle, building, the machinery of the company.

 

Indirect income (income indirect)

You can open ledger account such as income from rent, interest, commission received, etc

 

Indirect expenses (expenses indirect)

You can open ledger account of those expenses that are done on sales of goods, and that directly affects its profit and loss a/c. For eg. Salary shop rent, advertisement, postage, printing, and stationery, electric bill, telephone bill, etc.

 

Investments

This is a primary group and can open ledger accounts such as shares, LIC, bonds and other securities and investments made by the company.

 

Loans (liability)

This is a primary group and can open ledger account such as loan taken by the company. This group is divided into 3 subgroups which are as follows.

 

Bank OOC a/c

You can open ledger account under this group are all overdraft accounts with banks like hypothecation account, C.C. A/c etc.

 

Secured loans

You can open ledger accounts such as long/ medium term loans taken by the company from financial corporations, banks etc. against its fixed assets.

 

Unsecured loans

You can open ledger account where the company has taken loans unconditionally. For ex. Loan taken from friends, relatives, directors, partners, other securities and investments made by the company.

 

Purchase account

This is a primary group and open ledger accounts of all purchase account of the company.

 

Misc Expenses (Asset)

It is a rarely used primary group. The loss of company which has not been written-off but carried forward to the next year, however, treats it as a negative profit and carries it to profit and loss account.

 

Sales & account

This is a primary group and open ledger accounts of all goods sales account of the company

 

Suspense account

A suspense ledger account is opened which keeps track of money received or paid by the company, whose nature of the transaction is not yet known for ex. Money paid as traveling advance, the detail of which will only be known after the submission of TA bill.

 

Enabling GST in Tally.ERP 9

Gateway of Tally > Press F11 > Statutory & Taxation > Set Following Options to ‘Yes’

Enable Goods and Services Tax (GST)

Set / Alter GST Details

 enabling gst in tally erp 9
 enable gst in tally erp 9
 activate gst in tally erp 9
 

Creating the Groups

The single group allows you to create one group at a time whereas the multiple group options allow you to create several related groups at a time so it saves your time

Single group creation

Gateway of Tally > Accounts Info > Groups > Create

single group creation in tally erp 9 
group creation in tally erp 9 
 
Press Enter & Accept the screen & press Esc and return to Gateway of Tally

 

Multiple Group Creation

Gateway of Tally > Accounts Info > Groups > Under Multiple Groups > Create

Under Groups Select Sundry Debtors

In name of group field type Mumbai debtors, Pune debtors, Nagpur debtors, Dhule debtors.

Once all the data is entered correctly press enter to accept the screen as shown below.

multiple group creation 

Press Enter & Accept the screen & return to Gateway of Tally
 

Alteration of Group

You can alter the groups in single made or multiple made by selecting after from the means to change the info.

Gateway of Tally > Accounts Info > Group (Single) > Alter

From the list of groups displayed on the screen select the newly sub-group customer

Change the name customer to debtors.

alteration of company in tally erp 9 

Press Enter & Accept the screen & Return to Gateway of Tally
 

Deletion of Groups

Gateway of Tally > Accounts Info > Groups (single) > Alter

From the list of groups displayed on the screen, select the group debtors and press enter

Press Alt + D to delete the group

Press “Y” or “Enter” to confirm the deletion

Note: you cannot delete tally pre-defined groups, or groups with sub-groups, or groups containing ledgers.

 delete of group

Press Esc & Return to Gateway of Tally

 

Creating the Ledger Account

Gateway of Tally > Accounts Info > Ledger > Create (Single Ledger)

create ledger in tally erp 9 
Note: Tally automatically assumes that Dr. Balance but you can change it to Cr. By just typing “Cr” over “Dr” for sundry debtor groups the balance should be “Dr”

The following screen shows a new single ledger creation

creation of ledger account in tally erp 9 

When you accept the data, tally displays a blank ledger creation screen and you could go on to enter further ledger details

In this case press Esc. Followed by Enter key to return to the ledger creation screen.

Alteration of ledger account

Gateway of Tally > account info > ledger > alter (single) > change the ledger name Amitabh to Amitabh Bachchan as shown in following screen & press enter to accept.

alteration of ledger account in tally erp 9 
 
 

Deletion of Ledger Account

Gateway of Tally > Account Info > Ledger > Alter (Single)

From the list of ledger select in the ledger alteration screen select the ledger account

Amitabh Bachchan to delete & press Alt + D and Enter

Note: you cannot delete the ledger once the vouchers have been entered (excluding the Op. Balance)

 

Creating Multiple Ledger Accounts

Gateway of Tally > Account Info > Ledger > Multiple Ledger > Create

multiple ledger
Note: Multiple ledger options are selected to create a set of ledgers with a common group. You cannot delete a ledger in multiple modes. You can delete ledger only in the single alteration mode.

Following screen shows multiple ledger creations.

multiple ledger creation 

Press Enter & Return to Gateway of Tally.
 

Creating the Ledger & Entering Party GST Details:

Gateway of Tally > Accounts Info > Ledger > Create

entering gst details in tally erp 9 
gst details in tally erp 9 
 
tally erp 9 gst details 
Press Enter to accept the screen.
 
 

Balance Sheet

If a businessman wants to switch from manual accounting to computerized accounting for the year 2017-2018, the first step he has to enter all the opening balances from the audit report or balance sheet. Here is the detail audit report of m/s Shriram electronics for the year 2016-17

Enter & create the ledger a/c under the appropriate group with their opening balances as shown in the following screen.

balance sheet 

Creating the ledger accounts

  • . R.C. Patel
  • . Cosmos Bank as shown on the liabilities side of Balance Sheet

 

Gateway of Tally > Accounts Info > Ledgers > Single Ledger > Create

 
 
 

Press Enter & Accept the Screen

Creating the New Ledger Cosmos Bank

 

Press Enter & Return to Gateway of Tally

Entering Opening Balances of List “A” Unsecured Loan in Tally

Gateway of Tally > Accounts Info > Ledger > Create (Multiple) > Enter the following Ledgers with their opening Balances under Group Unsecured Loan

 

Press Esc & Return to Gateway of Tally

Check whether you have entered correctly

Gateway of Tally > Balance Sheet > Loans (Liabilities) > Unsecured Loans > Enter

Entering Opening Balances of List “B” Sundry Creditors in Tally

Gateway of Tally > Accounts Info. > Ledger > Create > (Single) > Enter the following Ledgers with their opening balances under Group Sundry Creditors

 

check whether you have entered correctly

Gateway of Tally > Balance Sheet > Current Liabilities > Sundry Creditors > Enter

Press Esc & return to Gateway of Tally

Entering Opening Balances of List “C” Fixed asset in Tally

Gateway of Tally > Accounts Info. > Ledgers > Create (Multiple) >

Enter the following ledgers with their opening balances under group fixed assets

 

Press enter and accept the screen and return to Gateway of Tally

Check whether you have entered correctly

Gateway of Tally > Balance sheet > Fixed Asset > Enter

Press Esc and return to Gateway of Tally

Entering Opening Balances of List “D” Investment in Tally

Gateway of Tally > Accounts Info. > Ledger > Create (Multiple) >

Enter the following ledgers with their opening balances under Group Investments

 

Check whether you have entered correctly

Gateway of Tally > Balance sheet > Investments > Enter

Press Esc & return to Gateway of Tally

Entering Opening Balances of List “E” Deposits (Assets) in Tally

Gateway of Tally > Accounts Info > Ledgers > Create (Multiple)

Enter the following Ledgers with their opening balances under group Deposits (Asset)

 

Check whether you have entered correctly

Gateway of Tally > Balance Sheet > Current Assets > Deposits (Asset) > Enter

Press Esc & return to Gateway of Tally

Entering Opening Balances of List “F” Sundry Debtors in Tally

Gateway of Tally > Accounts Info > Ledger > Create (Single) >

Enter the following Ledgers with their opening balances. Under Group Sundry Debtors

 

Check whether you have entered correctly

Gateway of Tally > Balance Sheet > Current Assets > Sundry Debtors > Enter

Press Esc & return to Gateway of Tally

Entering Opening Balances of List “G” Bank Account in Tally

Gateway of Tally > Accounts Info > Ledger > Create (Multiple) >

Enter the following ledgers with their opening balances under Group Bank Account

 

Check whether you have entered correctly

Gateway of Tally > Balance Sheet > Current Assets > Bank Account > Enter

Press Esc & return to Gateway of Tally

Entering Opening Balance for Ledger Account CASH

Note: While entering the opening balance of cash in hand there is no need to create a new ledger account as cash because when you create the company by default two ledger accounts are already created. i.e. Cash & Profit & Loss a/c. So just Alter the ledger Cash & enter the opening balance.

Gateway of Tally > Accounts Info > Ledger > Alter (Single)

Select the Cash Ledger & Enter Opening Balance as 1,56,548.00

Cheque whether you have entered correctly

Gateway of Tally > Balance sheet > Current Assets > Cash-In-Hand > Enter

Press Esc & return to Gateway of Tally.

 

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