Running a business is a not a single specific activity but comes with everything, right from the commencement of the business/ company/venture, legal compliance, capital allocation, human resource management, accurate accounting, regular publishing of the financial statements, assessment of net tax liability & tax compliance, bank reconciliations, sales & purchase management, payroll management, Inventory management, to having a robust security system in place to maintain the database, etc.
Executing all these activities certainly need robust and efficient systems/frameworks in place. Here, comes into play various automatic system driven softwares which play an integral role in helping businesses manage their financial transactions in the most accurate and best possible manner!
Finance is the core of the business, once its well automated, accurate and well take care of, all the systems follow one after another which inturn leads to a very financially & structurally sound succesful business, such businesses become system driven, data driven and are quite unstoppable and limitless in nature as their main component (the finance department) is perfectly managed.
What Is A Tally Software?
Tally is developed by Tally Solutions Pvt. Ltd. It is an accounting software which is used for various financial transactions. It has a user friendly interface and comprehensive features due to which it is quite popular among businesses of all sizes.
Tally is a well-known accounting program that employs its own database known as Tally Database. Tally Database is a binary file-based database system built exclusively for Tally software.
Some important fundamental aspects of Tally are:
- Book Keeping
- Inventory Management
- Tax Compliance
- Payroll Management
- Multi-currency Support
- Data Security & Backup
- Integration & Customisation
Versions of Tally:
- Tally 4.5- 1990 – Based on MS-Dos.
- Tally 5.4- 1996 – Graphic Interface Version.
- Tally 6.3- 2001 – Based on Windows, includes VAT (Value Added Tax) and printing features.
- Tally 7.2- 2005 – Statutory Complimentary Version and included state wise VAT (Value Added Tax) rules.
- Tally 8.1- 2006 – New Feature of Point of Sale (POS) and Payroll.
- Tally 9.0- 2006 – TDS, FBT, Payroll, E-TDS Filling.
- Tax Deducted at Source (TDS):
- TDS is a system where tax is deducted at the source of income by the payer and remitted to the government. It applies to various income types, including salaries, interest, rent, commissions and professional fees. The payer is known as the deductor and the recipient of the payment is the deductee. TDS rates vary depending on the type of income and transaction.
- Fringe Benefit Tax (FBT):
- FBT was a tax levied on the employer for benefits provided to employees in addition to their salary. These benefits were not included as salary income but added to the employee’s overall compensation. Examples included free or concessional tickets, club memberships, and contributions to superannuation funds. FBT was abolished in 2009, effective from the financial year 2010-11.
- Payroll:
- Payroll refers to the process of managing and paying employees, encompassing salary calculation, deduction of taxes and other statutory requirements, payment disbursement and tax filings. It begins with onboarding employees and ends with submitting statutory reports and depositing deductions.
- E-TDS Filing:
- E-TDS filing is the electronic submission of TDS returns to the Income Tax Department. It is mandatory for all corporate and government deductors.
- Tally ERP 9- 2009 – GST
- GST stands for ‘Goods and Services Tax’.
- 101 Constitutional Amendment Act, makes sure that the various indirect taxes are paid to the government by introducing a substitute; in the form of GST, making it a single indirect tax. GST is a comprehensive tax, which permits both the Central government and the State governments to assess excise duty, Octroi tax, customs duty, service tax, entry tax, entertainment tax, other indirect taxes, all substituted by the GST.
What Does An ERP System Do?
ERP (Enterprise Resource Planning) is software that integrates core business processes, such as finance, human resources and supply chain management, into a single, unified system. By consolidating data and automating functions, ERP software provides a single source of truth, eliminates data duplication and improves efficiency by streamlining operations and providing real-time insights for better decision-making.
An ERP system connects various business departments and processes, including:
- Finance and Accounting: Manages general ledger, accounts payable, accounts receivable and financial reporting.
- Human Resources: Automates HR processes and effectively manages employee data.
- Manufacturing: Integrates product planning, development and production.
- Supply Chain Management: Optimizes procurement, inventory and logistics.
- Sales and Marketing: Manages customer relationships and sales processes.
Key Benefits of ERP:
- Centralized Data: Consolidates all business information into a single database, eliminating data inefficiencies.
- Improved Efficiency: Automates manual processes and streamlines workflows.
- Enhanced Visibility: Provides real-time insights and a unified view of operations for better strategic planning.
- Increased Accuracy: Reduces manual errors by standardizing data and processes.
- Scalability: Can be scaled to meet the needs of businesses of all sizes, from small businesses to large enterprises.
Tally ERP 9:
- The ERP in Tally ERP 9 stands for Enterprise Resource Planning. It is one of the most popular business management softwares for small and medium businesses in India.
- It primarily includes Accounting, Finance, Costing, Inventory Management, Payroll, Purchases, Point of Sales, Sales, Branch Management, Excise, TDS, TCS, GST, Generating Reports, etc.
- Tally ERP 9 follows Accounting rules, Principle and the Double entry system.
- It classifies transactions into account categories like assets, liabilities, equity, revenue and expenses.
- It complies with the GAAP (Generally Accepted Accounting Principles) Standards of Accounting and follow regulatory standards.
- The Double Entry System followed, gives two effects to every transaction (a debit entry and a credit entry).
- The Software adheres to the fundamental accounting equation: Assets = Liabilities+Equity.
- Tally efficiently & effectively generates corresponding entries for each transaction, safeguarding the accuracy of financial records.
Uses of Tally ERP 9:
Accounting: It generate Financial Statements and offers comprehensive features like book keeping, bill-wise/date wise details, accurate cost allocation, payables and receivables management and reconciling various documents.
Taxation: It includes modules of Goods & Service Tax (GST), Tax Deducted at Source (TDS), Tax Collected at Source (TCS), Value Added Tax (VAT), Central Sales Tax (CST), Excise and Service Tax.
Banking: It meets various banking requirements, like e-payment processing and reporting, cost centre management, reconciliation, payment advice generation and cheque management.
Sales Management: It provides accurate sales related information like sales order, stock groups, stock query, price discounts, credit note, etc.
Purchase Management: It provides all the necessary accurate purchase related information like purchase order, item details, cost, expenses, debit note, etc.
Payroll Management: This feature in the Tally software provides the details of salary, employee profile, payroll reports, PF/ESI calculation.
Manufacturing And Job Work: It provides information related to Raw Materials, Work-In-Progress, Finished Goods, multi-bill of material, warehouse, godown, manufacturing journal, etc.
Inventory Management: Ascertainment of the safe, danger levels in regards to the stock. Creating the alarming levels when a new stock needs to be replenished to keep the smooth running of the business intact. It includes batch processing, measuring units, inventory classification, bill of materials, etc.
Effective Inventory Management consists of tracking the various levels of inventory from time to time:
- Reorder Level: When to order?
- Minimum Level: Atleast how much to stock?
- Maximum Level: Upon how much to stock?
- Average Level: Stock normally kept.
- Danger Level: Kept for emergency requirements.
Internet: It provides E-mails and knowledge base support.
Data Exchange And A Robust Security: Tally provides data synchronization, multiple format report, xml compatibility, secure storage and trasmission.
