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  • What is Tally?

    • August 12, 2020
    • Posted By : Priyambika
    • Comments Off on What is Tally?

    With the advent of technology, entrepreneurs and enterprises have been in a quest to adapt to the best of software for their businesses. Smooth business management is presently not a tedious task since some of the great minds have made the best usage of technology to develop customer-centric solutions. Technology has been moulded into exceptional software which assists individuals to run their organisations in better manners. One such example is that of Tally.

    Tally is one of the most commercialised and popular accounting software which could be spotted in several enterprises. The software has been able to provide accounting solutions to several medium and small level start-ups, businesses and enterprises. The software has been widely adopted in India.

    The software aims to solve financial complications in the business and helps in its overall smooth functionality. Aspects like Sales, Inventory, Production costs, miscellaneous payments, etc. are comprehensively looked after by simply employing the software in the systems. Moreover, TDS, GST, TCS, etc. are also taken care of simultaneously. Accounting was considered to be a laborious task and was usually carried out manually. However, the assistance of technology has left zero to the minimum scope of accounting errors and has made the overall task effortless.

    The Tally software has been built with a wide range of features which suit various small to medium level businesses and assist them in multiple manners. A few ways in which Tally has been erasing business complications are mentioned herewith.

    History of Tally

    Tally Solutions Pvt. Ltd. is an Indian technology company that provides software for enterprise resource planning or ERP, which is the integrated management of various processes of a business. The company has its headquarters in Bangalore.

    Previously known as Peutronics, the company’s founders are Shyam Sunder Goenka and Bharat Goenka. They founded the company in 1986 in Bangalore. The company was started as a raw material supplying chain to various textile mills and manufacturing units. Its first foray into software development occurred after finding a demand in automated accounting solutions. Various businesses wanted an easier way to manage their books and make accounting cheaper and reduce errors but there wasn’t any effective software available and if it was, was costly. This encouraged Bharat Goenka to start working on developing software which was cost-effective as well as user friendly and could be used by any business without any need to learn it.

    Thus, Peutronics was renamed to Tally Solutions in 1988 and began developing accounting software which initially, was without any coding. It was developed as a financial helper which managed books and acted as an accountant. In the mid-80s, personal computers had started gaining popularity. Especially in businesses, there arose a demand for computerised work. One of the first operations to be computerised was accounting. But due to the unavailability of helpful and cheap software, many businesses opted out of investing in it. Tally became the first company that recognized this void in innovation and began software development.

    They began their journey with their first product which was named Tally 3.0. Each product was described by a version number like Tally 3.0, 4.5 or 5.4. Tally 3.0 software was based in MS-DOS (Disk Operating System). Versions from 3.0 to 4.5 were all based in DOS as they were unable to operate in Windows OS. They could carry out the fundamental financial accounting and bookkeeping operations. Tally 3.0 was only the prototype software which provided accounting reports and analysed credits and debits of a company. The major aspect of this that was left wanting was that of being user-friendly. These versions delivered in terms of speed and were much faster than manual operations but lacked in ease. The user still had to work a considerable amount to get the required results. To overcome this limitation, further versions namely Tally 5 and 5.4 were developed. These versions introduced Tally to Windows operating system. This made them easier to use due to better Graphical User Interface or GUI. The Tally 5.4 introduced stock reports to the software. Further versions of Tally were 6.3 and 7.2 which incorporated the taxing systems like VAT, service taxes and TDS. Tally 8.1 was the first version to allow a multilingual interface. It also included excise operations. The latest version of Tally is Tally 9. This version brought in international taxation and foreign languages.

    The crown jewel or the most significant product of Tally was Tally.ERP 9 version. With this, Tally stepped into enterprise resource planning in the year 2009. Further versions were referred to as releases. Release 1.0 introduced rectification of errors and other statutory alterations. It was the first complete software enterprising software for MSMEs or Micro, Small and Medium Enterprises. It is the entire process of accounting carried out in digital media. The user has to make debit and credit entries and the rest is handled by the software.

    ERP is a domain which is new to MSMEs and is generally beneficial for them. Tally made this a mainstream domain and is now the leading ERP provider in the country and even abroad. In ERP, businesses get a constantly updated analysis and view of their core business procedures maintained by DBMS or database management system. ERP tracks the main business outflows and resources such as raw material, credit balance and production capacity. It also manages the business commitments such as payroll and purchase orders. Tally ERP also assures transparency of a company. It facilitates an information flow between the firm or business and the stakeholders resulting in accountability of the company and assurance for the stakeholders. It is an error-free as well as a cost-efficient method of handling financial matters of a company and operates in real-time.

    What Tally has done is legitimise the ERP processing for smaller-scale businesses in India which have increased in number since startups have grown. These small businesses can rely upon such applications and digitise their accounting. Tally ERP provides companies with three types of services: consulting, customization and support. It also incorporates the best practices in a company. Tally ERP represents the business’s interpretation of the most effective way to perform each business process. According to analyses, it has resulted in a 72% risk reduction as compared to manual processes.

    Tally has vastly grown in the 2010s when companies decided to replace their old methods with digitised algorithms. Tally initially focussed on back-office functions that informed only the company and did not deal directly with the customers and the public. But as the popularity and usage of ERPs increased, companies started trusting them to deliver results which have resulted in Tally emerging as the biggest name in accounting and ERP software.

    Where is Tally used?

    • Banking has now become an easy task

    This feature is relatively new to the software, however, easy banking through Tally ensures a flexible way of doing transactions in and across the country. Banking, carried out through the software, also helps users in reconciling bank statements with the data in the bank account books. Customers can create bank slips, cheques, etc. through the software at any given time through trading or non-trading accounts.

    • Errorless and trouble-free accounting

    Trouble-free accounting is one of the key features of the software. The software has been built with different accounting modes which are carried out in various transactions and are customisable. The different ways in which accounting is carried out in Tally include debit, credit, sales, receipt, payments, memos and purchases.

    • A well-maintained Inventory

    Inventory kept at a unit holds an invisible cost. Therefore, business holders ensure that the inventory is put to good use and does not remain within the office unit. An inventory which fails to bring sales often drives the business to loss and wastage. Hence, the Tally software classifies inventory and keeps a record of it. The items are segregated into groups or sections and are further organised, to avoid any loss of money or resources.

    • Easy Taxation

    Tally software ensures that errorless tax is calculated on commodities. In India, different taxes are employed on a wide range of items. Hence, the software ensures that the correct tax is put on items which are added to the system. Income tax, VAT, services tax, etc. are considered and put accordingly.

    • Customisable Currencies

    The software ensures easy transactions from one currency to another. This feature has been widely employed by customers dealing with International Trade. Moreover, transactions carried out over different countries or continents can be spotted easily irrespective of the exchange rate fluctuations. Earlier, due to unfluctuating currency rates in different countries, business holders had to consider several factors while doing accounts in an international trade set-up. However, this complication has now been solved.  

    • Trouble-free Billing process

    Users can carry out billing processes from various trading or non-trading accounts. The bill receipts, challans, etc. can also be viewed without any hustle. An in-built tracking system ensures that no bill is misplaced from the deck. This feature also assists business holders in keeping an account of bills over a long period. Moreover, users can view the billings of different customers and can also spot invoices and overdue. The flexible billing system in Tally also helps in the segregation of customers based on their billing cycles and activities.

    • Ease of Diverse Transaction

    The software has been developed with a voucher system which enables the user to drive multiple transactions. This feature is considered to be providing flexibility to individuals who have to carry diverse transaction which different parties. The voucher system ensures that the transactions done with different parties are registered and showcased in the form of a document within the software. 

    • Customisable Interest Calculation Methods

    The software allows individuals to calculate interest on different commodities using various in-built calculation methods. Interest can be calculated using different customisable methods. User can view a detailed transcript of the interest along with the balance amount after the interest has been calculated.

    • Easy Comparison among different payable parties 

    A business comprising of different payable parties, customers or clients finds it difficult to spot which one of them is bringing maximum profit and vice-versa. However, with Tally, business runners can spot the source of maximum profit and loss. The source of loss could be further looked upon and improved. Business runners can further take the necessary steps to eliminate unwanted parties. 

    Software like Tally has been a boon to the Indian business holders. Indian businesses have been comprising of several miscellaneous activities and with software like Tally, each step could be monitored and looked upon. Since every step of accounting, banking or any other money transaction is reviewable, the businesses tend to thrive in longer runs. Moreover, with the introduction of new versions and polished updates, the software has been lately able to eliminate different complications faced by the users. The software has been built with a majority of unique features which would make any business run smoothly. It would be fair to say that the software is an underrated gift to the multiple business holders and business runners. For businesses aiming towards an organised set-up, this software is a must.