What is Tally? A Beginner’s Guide for Accounting Students

What is Tally?

At its core, Tally is an accounting software used to record and manage business transactions. Think of it as a digital version of the traditional accounting register your seniors might have used years ago - except it’s faster, more accurate, and capable of handling thousands of entries effortlessly.

Technically speaking, Tally in computer is a program developed by Tally Solutions Pvt. Ltd., an Indian company that revolutionized how businesses maintain their books of accounts. Instead of juggling notebooks, receipts, and Excel sheets, Tally allows you to manage everything - from ledgers to inventory - in one place.

For students pursuing commerce or chartered accountancy, knowing what is Tally is no longer optional. It’s one of those tools that separates someone who knows theory from someone who can actually do the work.

Why Tally Became So Important?

Before we dive into the details, it’s worth understanding why Tally is so popular. Businesses of every size - from small shops to multinational corporations - need to keep track of their income, expenses, taxes, and stock.

In earlier days, this was done manually. Mistakes were common, data was hard to track, and generating financial statements took days. Tally changed that.

It made accounting accessible even for those who weren’t tech-savvy. One software could handle everything: bookkeeping, GST filing, payroll, and reporting. That’s why even today, if you walk into any CA office, you’ll find Tally open on at least one screen.

What is Tally Prime?

You might have heard people talk about Tally ERP9 and Tally Prime and wondered what the difference is.
Tally Prime is the latest version of the Tally software - a more modern, intuitive, and user-friendly upgrade from its predecessor, Tally ERP9. While the earlier version was powerful, it looked and felt quite technical. Tally Prime simplified the interface and made the workflow smoother, especially for new users.

Here’s what Tally Prime brings to the table:

• A cleaner, easier interface for beginners.
• Enhanced GST and e-invoicing support.
• Faster data access and real-time reports.
• Improved navigation with fewer steps to reach any function.
• Built-in security and user access control.

In short, if you’re just getting started and wondering what is Tally Prime, it’s the latest and best version to learn on. It’s designed to be both powerful and beginner-friendly - something students appreciate when they’re learning on their own.

What is the Use of Tally?

Understanding what is Tally is one thing. Knowing what is the use of Tally is another - and this is where the real learning begins.

Tally isn’t just about recording transactions. It’s a full-fledged business management tool. Here’s what it can do:

So, when you’re asked in an interview what is the use of Tally, you can confidently say: “It simplifies every part of accounting - from recording transactions to managing taxes, payroll, and reports - all within one system.”

What is Ledger in Tally?

Now let’s get into some of the technical basics - starting with ledgers.

In simple terms, a ledger in Tally is like a digital account book for a specific person, expense, income, or item. Every time you record a transaction, it’s posted to one or more ledgers.

Here’s a simple example:

- You buy office stationery worth ₹1,000 in cash.
- The Cash Ledger decreases by ₹1,000.
- The Stationery Expenses Ledger increases by ₹1,000

Both of these ledgers will reflect that entry automatically in Tally.

Understanding what is ledger in Tally helps you grasp how accounting works in real life - every transaction affects at least two accounts (following the double-entry system).

Common ledgers you’ll create in Tally include:

• Cash
• Bank
• Sales
• Purchases
• Sundry Debtors (Customers)
• Sundry Creditors (Suppliers)
• Expenses like Rent, Salary, Stationery, etc.

For beginners, creating and managing ledgers in Tally is the first hands-on step toward real accounting practice.

What is Voucher in Tally?

The next term you’ll come across frequently is voucher.

In Tally, a voucher is a document used to record any type of transaction. Think of it as the digital version of a bill, receipt, or invoice. Each type of transaction has its own voucher format.

The most common types of vouchers in Tally are:

• Sales Voucher – for recording sales made.
• Purchase Voucher – for purchases of goods or services.
• Payment Voucher – for cash or bank payments.
• Receipt Voucher – for money received.
• Journal Voucher – for adjustments or non-cash entries like depreciation.
• Contra Voucher – for transfers between cash and bank accounts.

When you understand what a voucher is in Tally, you realize it’s the heart of every entry you make. Without vouchers, no transaction can be recorded.

What is Tally ERP9 for Beginners?

Before Tally Prime, there was Tally ERP9, which was widely used for over a decade. Even today, many companies still operate on ERP9 because it’s stable, reliable, and familiar.

For students just starting out, learning Tally ERP9 for beginners can be a good way to understand the foundation of Tally - how companies are created, how ledgers and groups are structured, and how entries flow into reports.

ERP9 may look a bit older compared to Prime, but its core functions are the same. Once you master ERP9, switching to Prime is simple, as both follow the same accounting logic.

How to Learn Tally Basics?

If you’re completely new to accounting software, don’t worry. Tally is one of the easiest platforms to learn. Here’s how most students begin:

Why Accounting Students Should Learn Tally?

In the accounting and finance world, practical skills matter as much as theory. You may understand journal entries, but employers want to see if you can actually use software like Tally to handle real accounts.

Here’s why Tally is essential for students:

• It bridges theory and practice. Concepts you read in books-like ledgers, vouchers, and trial balances-come alive in Tally.
• It boosts your employability. Most CA firms, SMEs, and even corporates expect basic Tally knowledge from interns and entry-level hires.
• It saves time in internships. Instead of spending weeks learning how to make entries, you can start contributing from day one.
• It builds confidence. Once you know how to manage books in Tally, handling real-world clients feels much easier.

In short, learning Tally early gives you an edge that pure academics alone can’t provide.

Final Thoughts

So, what is Tally? It’s more than just software-it’s a skill every accounting student should master.

It teaches you how real businesses record their finances, comply with taxes, and make decisions based on reports. From understanding what is Tally Prime to learning what is ledger in Tally and what is voucher in Tally, each concept connects directly to the fundamentals of accounting.

Whether you plan to join a CA firm, work in finance, or run your own business someday, Tally will be one of your most practical tools.

Start small. Practice daily. Learn how entries move through ledgers, vouchers, and reports. Before long, you’ll not only know what Tally is in a computer, but also how it shapes the backbone of modern accounting.