Last Updated on: 3rd June 2025, 11:43 am

Accounting Software System Overview

Accounting Software Overview

Before we start about working with Tally, let us look at snapshot of General Features of a Business Accounting System, commonly available in all Accounting Software System.

Apart from mainlining Accounts and Accounting Reports, a good Accounting Software system must be able to align with organisation system work flow and process, assist routine operations, and provide key information instantly.

Business Accounting Objectives

Business Accounting Objectives

• Past Transactions : Recording & Compilation of Past Accounting Transactions
• Current Activities : Recording, Analysis & Interpretation of Current Activities
• Future Plan : Planning for future Growth, Profitability

The objectives of Business Accounting System may be broadly categorised as :

• Maintain Historical Records: We need to maintain accounts for several reasons, like submit accounts to the Government, Tax authorities, Shareholders, Financiers, etc. Often, this is the biggest reason to maintain business accounts. This, in essence, is just record of past activities, already happened.
• Management of current Business Affairs: Accounting records help us manage current business, manage Receivables & Payables in time, utilise resources, invest funds, in efficient way. Accounting Software can help management of resources optimally, communicate Accounting Data with customers, suppliers, through the Accounting Software, as per work flow of the business activities. To sum up, Accounting system can help in more efficient management of business, rather than just preparing Accounting Books & Reports.
• Planning for Future Growth & Profitability: Apart from recording past activities and managing current business affairs, the Accounting System should also help to grow the business, in acquiring new customers & suppliers, better financial budgeting & future planning, discovering new avenues of growth.

Features of Modern Accounting Software

Every Accounting software has its own strengths and focus aspects. You should evaluate your priorities and how these are met by the Accounting Software, while selecting the Accounting Software system.

To evaluate the impact and suitability of an Accounting System in your business, let us understand discuss about key terms of Computerised Financial Accounting Software. At the same time, we will also see how these features and objectives are implemented in Tally. 

For ease of discussion, Business Accounting Software features are classified into grouped below, based on based on characteristics.

Accounting Software Features Classification

• System Ownership and Integration : Data Location & System Integration
• Operations Features : Operational Ease and Support Service
• Operational Facilities Tools : Work Simplification Facilities
• Security and Access Controls : Operations Access Control, Data Security

Accounting Software Features Classification

Now, we briefly explain the common features under each of these classifications, for better understanding.

Among all Accounting Software, most of which are modern technology based, Tally is traditional legacy software evolved over a time, catering to some exclusive requirement of business enterprises.

So, you may also look at the overview of salient features of Tally , and the latest new features added in Tally 

Accounting System Ownership and Integration

Based onData Location & Integration, it may be classified as :

• Software & Data Ownership : Location of Software & Data
  • Premises Based– Software and Data on Company’s Computer
  • Cloud Based -Software and Data on Cloud under Service Provider
• Integration Horizon : Level of System Module Connectivity
  • Enterprise Accounting System – EAS -Integration of Internal Functional Modules
  • Enterprise Resource Planning -ERP -Holistic connectivity through Internet

Software Ownership and Integration

Accounting System & Data Ownership

Based on  Physical location of Software & Data and its exclusive ownership, Accounting Software System may be broadly classified as Cloud Based vs Premises Based . Cloud software resides in Cloud Server, out of organisation physical premises. It is accessed and shared by authorised persons of the user organisation, from any place. With Internet proliferation and technological advancements, Cloud Based systems are gaining popularity. Managers are  looking for information sharing, speedy execution and effective business control. Cloud system offer very stringent security features and firewall.

• Premises Based System : Premises Based software reside within the organisation premises, who has exclusive control on data and software. Such systems are still in vogue due to age old inhibitions of physical Ownership and control of Data and Data security.  People are now coming out of

Tally is Premises Based Software .
The Tally software as well as all data resides in your computer system only. So, operation should primarily be performed from the premises where the Software is installed. Access and operation in Tally from remote places are indirect & limited.

However, Tally now leaning towards Cloud Based System, through the latest developments of Tally on AWS.

Accounting System Integration Horizon

Based on span and extent of functional module integration,large enterprise Integrated Accounting System may broadly classified as EAS (Enterprise Accounting System) and ERP (Enterprise Resource Planning).

• EAS System : An EAS System, focus mainly on recording of past transactions, Integrating various functional areas of Business into central core System. EAS System maintains detailed accounting records, generate Accounting Reports, enabling Statutory Compliance.  So, EAS system focuses on Historical aspects of what has happened.
• ERP System : On the other hand, ERP System focus on how organisation resources be managed to give best results. It uses historical accounting records to manage current affairs, and also forecast and plan ahead for the future working. So, an ERP system is also about future action planning, rather than just historical recording like an EAS.

Key difference between EAS and ERP lies on extent of enterprise functional areas of the organisation covered and seamless integration between all components of the system.

In this respect, Tally can be viewed as EAS software, with primary focus on maintaining Accounts Books and Statutory reports, while aspects of Financial planning and management, are naïve and rudimentary.

Accounting Software Operations Features 

Accounting Software system offers following key features forOperational Ease and Support Service:

• FREE Module: Availability of FREE version.
• Personnel Training :  Training Facility & Trained Personnel
• User Interface : Self explanatory WYSIWYG Intuitive interface
• Work Flow based Operation : Structured Menu aligned Operational Workflow
• Micro level operational guidance : Granular level operations instructions
• On Line Help : On line context sensitive help, last mile details exploration.
• Support Service : Educative posts, Off line and Off line support, Live interactive and active hands on support.

Software Operations Features

FREE Module: Normally packaged software developers offer a Trial Version to try the Software, free of cost, for a limited time, or with limited data, or other restrictions. The user, if satisfied using Trial Version, may go for the full regular version, by paying the license fees.

Tally provides such Trial Version (Called Educational version). However, instead of Data volume, Reports or time restrictions, Tally Educational Version allows to work almost like Regular licensed version, with some Date restriction.

FREE Educational version of Tally helps Prospective Tally Users as well as Tally Learners.

• Helps the prospective users to try and test Tally, creating with real life data. This brings more confidence to prospective buyers of Tally.
• Allows the training institutes to offer better training, without paying license fees. This helps Job seekers. Employers get trained personnel easily. Hiring trained staff is easier. Self learners can learn Tally free of Cost, on their own.

Personnel Training : Many vendors provides short awareness training, normally free or low cost, to train personnel to operate and support the Accounting system. This enhances user knowledge and they seek less support from Vendors. So, good training reduces support cost on part of Vendor.

User Interface: Now-a-days contemporary Software provides modern interface, a delight for young and modern users, with intuitive WYSIWYG forms in one glance. Look and feel of the forms and menus itself reveal the purpose and operation.

In Tally, Input Forms are not WYSIWYG, split into many parts, popping up small independent component screen, hiding the main screen and other parts, requiring multiple to & from juggles. So, the user can see only a part of the input data, at any point of time. Component screens are devoid of reference to the record being created.

In text input field, data may be restricted. Cursor is to be serially moved letter by letter. So, editing of long text is difficult and time consuming. The user interface is not intuitive. Users need to undergo through deep learning and training to operate.

Work Flow Based Operation: In an on-line system, Menus for operational tasks follow the work flow path. Tally is more inclined to legacy Master-Voucher-Report work flow, rather than real life operational path.

Instead of invoking a task from the initial point, task may be carried from the end of respective  previous task. The data filled up till the pervious task get auto populated. So, no need to input data again which have already been input and available to the system.

Micro level operational guidance : Micro level operational guideline at each input field, to guide about the information to be entered, the implication of alternate options and indication of next step, where necessary.

On line Help : A software is  evaluated by intuitive design, user friendliness and on line Help, so that user can find out the solution and answer on his own, instantly, without any external assistance. On-line help, further supported by granular level help system provides all assistance at finger tip.

Tally provides on line help from within Tally Accounting System. But the search capability of Tally Help is very rudimentary. Tally often produces unrelated search results, completely different from users search intent. Raher, the user will often be deluged in the ocean of info to find out the specific info needed. Rather than using unhelpful Tally Help, users would get better result through web Browser search (Google, IE, Bing, Edge, Firefox, etc) from the Web.

Support Service : Regular educative posts from software providers like Blog Posts, Newsletters, Videos; Off line support service like WhatsApp, e-Mail, keeps the users informed about new features, trouble shooting and better use of the System.  Apart from that, Live support like WhatsApp live chat, Chatbot, on Line active support through screen sharing tools, are also available.

Software Operational Facilities Tools

Accounting Software system offers  following operational tools

• Model Chart of Accounts : Replicable model chart of Accounts for Correct and Accounts structuremodeling.
• Pre Filled Input Form: Stagewise progressive Auto carried pre filled Input Data.
• Input Data Template: Customisation tools to add, organise and design Workflow Based Input Forms.
• Output Reports Designer: Customisation tools to add, organise and design Output Reports.
• Customisation of Report Format : Output format customisation at report generation stage. 
• Report Filters : User specified Filter parameters for Reports and Query
• Multi Order sorting : Multi column Multi Level sort parameters
• Multi Tasking : Perform simultaneous multiple tasks by users and tasks switching.
• Task Search : Quick Task search on Task descriptions in simple common words
• Business Calculation Tools : In Built versatile calculator, Pre-set Business calculation Tools on user defined calculation and Formula.
• Visual Informatics: Visual info graphs  on user definable parameters and scale.
• Sharing digital Reports through external App: Option to print Reports on Paper, save in digital form, sharing through popular Apps.
• Digital Form Documents Annexing: Annexing multi modal digital files to Masters and Transaction data.

Software Operations Facilities Tools

Model chart of Accounts : When a computerised Accounting System is newly introduced, a properly structured Chart of Accounts must be created for all Account Ledger Heads properly organised  under Account Groups in hierarchical Order. Accounting Software normally provides pre created list of Chart of Accounts for various business forms, Trade & Industry, as guideline template to quickly create well structured Chart of Accounts.

Tally does not provide any such model Chart of Accounts to copy.

Pre Filled Input Form : In secondary input form, primary data already available in the system are intelligently pre filled. For example, outstanding Bill payments, deliveries against Orders, items are just tagged instead of input, with intuitive work flow process

Tally still is obsessed with old style of Voucher Entry through user input data, resulting more data input efforts.

Input Data Templates : Some common  transactions frequently occur (like Conveyance Expenses) and some occur periodically (like Salary Payment). Accounting Software normally allows to design templets for such repeating transactions, with pre-filled Account Heads and standard Voucher Narration (Blank Vouchers). At Voucher entry screen, user may select the relevant templates from the pre created template, and fill up the Date, Amount and edit the standard narration suitably. This allows quick and correct entry by anyone. Some Accounting system even allow to create Template from Voucher for re use in future.

Tally does not allow to create and use such blank Voucher templates. Some smart persons may duplicate an existing voucher and change the data. But this is not a good solution and may create duplicate voucher accidentally.

Output Reports Designer: Customisation tools to add new input data items, organise input data and design Input Forms based on Workflow.

Tally provides some facilities of Report View parametrisation , for operational convenience.

Report Filters : A good accounting software should provide elaborate value and logic based expressions to extract refined results.

Tally now provides simple filtering options, a bit better than the erstwhile Range & Value operators. However compound filtering parameters options are not available.

Multi Order sorting : Column based data sorting options to specify independent parameters for each data column data sorting.

Multi Tasking Capabilities: Multitasking features, to initiate and switching between multiple simultaneously tasks.

Tally allows pleasant features of initiation, operation and switching between multiple tasks. For example, while performing a task, another task may be initiated and returned to previous task, smoothly switch between the active tasks (e.g. record a new voucher, create a master, view, and print reports, and get back to any open tasks).

Task Search : Users need to quickly get to the right option to perform a task. So, the software provides easy search features to find desired task in the maze of tasks and options.

In Tally, apart from navigation to known tasks, Go To Tab provides helpful search facility to find relevant reports based on search Key words.

In Built Arithmetic Calculator : Accounting systems normally provide in built full fledged Calculator to perform arithmetical calculations, allowing copy paste the results in input forms, as an alternative to external Calculators.

Tally provides handy internal Calculator, to perform quick arithmetic Calculation, allowing keyboard input or copy paste facility from between Tally Calculator & external applications.  The history of past calculation performed in the Tally Calculator, remain accessible till the end of session, for re use and reference. Useful handy assistant for quick and correct work.

Business Calculations: Accounting Software also provide tools for advanced Calculations like Root, Power, Log, Factorial, etc., and important Business Calculations like IRR, NPV, FV, Annuity, Sinking Fund, Depreciation, etc.,

Apart from bare rudimentary arithmetic calculator, Tally dies not provide any functionality or tools for Business Calculations

Visual Informatics: Modern Accounting Software provide attractive visual informatics in form of Charts and Graphs to assimilate key management info at a glance, supplementing the boring bulky figures.

The dashboard in Tally is a small effort to provide line graphs and charts & Key ratios. Tally just provides mediocre Bar Graphs in Reports. The infographics provided by Tally lacks depth and breath in the key info, reported in Dash Board

Accounting Reports Output and Sharing: Now-a-days users usually saves and shares reports in digital media, instead of hardcopy printouts. So, Accounting Software provides facility to save reports directly with recipient in digital form like PDF, Excel Sheet etc, during the printing session, as alternate to hardcopy reports, and simultaneously share through email, WhatsApp.

In Tally, report printing is focused on hardcopy Printout. Saving reports in digital format like PDF, XLS are time consuming and complex tasks, scattered in multiple distinct actions,

Sharing digital Reports  through external App : Currently displayed Reports & Documents may be shared through email or WhatsApp.

• Sharing Tally Reports through e-mail : Tally Reports (in formats like PDF, XLS, may be directly emailed to specified e mail recipients of popular email servers (like gmail, yahoomail, hotmail). For other email servers, Server Set up is required.
• Sharing Tally Reports through WhatsApp : Documents (like Invoice, Receipts, Delivery Notes, Payslips etc) may be shared through WhatsApp, directly from within Tally, to WhatsApp Number recorded in the Master records.

However, the initial set up and sharing process seem to be complex. Rather, it may easier to share saved reports in digital reports / documents by email / WhatsApp instead of sharing from within Tally.

Customisation of Print and digital output at report generation stage. 

Annexing Voucher related Documents in Digital Form : Normally people bind (pi  or staple) all Voucher related paper documents. To reduce handling of paper documents, good Accounting System offer facilities to link Digital copies of related documents with a Voucher, so that everything related to voucher may be viewed together.

Tally does not allow linking of related documents in digital form, with respective Voucher. Tally does not aim for complete digital record keeping. Manual documents are needed to be filed properly and preserved.

Accounting System Data Security and Access Controls

Accounting Software system offers following important features for Data Security and User Rights control.

• User Rights and Access Controls : Customised User Access and Operations Controls
• Data Alteration and Audit Logs : Rule based authorisation controlled Data Alteration, preservation of Pre-Alteration original Data.

Security and Access Controls: Accounting System must provide quick access to desired Information. At the same time, it must ensure that only authorised persons get to see info. So, the system must provide practical yet simple ways to set up user definable flexible authorisation system for each type of report.

Tally offers elaborate, yet complex methods to set up user rights and passwords at the granular level, for all data input, alteration, report view, key control and administrative tasks. However, the entire authorisation is complicated to set up. Key activity controls are missing, weakening the internal control system.

Data Alteration and Audit Logs : A digital record may be instantly altered without leaving any trace. The original data is overwritten. So, on alteration of any data, the original data before alteration should also be retained in background. Government has issued directive to comply Audit Logs of Data Alteration. In a sound audit trail system, complete data before and after alteration/ deletion, should also be available to authorised person.

Tally provides optional Audit Log features to record the activities (nature of operation), record id (reference of Voucher / Master worked upon) and User identity. However, on data alteration / deletion, original data before alteration is not retained.

Additional Special Features of Tally Prime

Tally provides some additional features to TSS or specific license, on prior set up.

• Connectivity with Statutory ePortals in Tally Accounting Software :Tally can directly connect with Statutory e-portals of GST, I Tax, Banks etc to import data from their secured site on authorised access, and easy upload statutory returns to the portals.
• e-payments through Tally Accounting Software : Payment may be made through Net Banking from within Tally.  Prior set up for e-payment with specified Bank is needed. After that, transactions can be exported to Bank system to make automated e-payments, like Net Banking system.
• Digital Signature of Reports in Tally Accounting Software : Tally Prime supports digital signature in vouchers and reports documents.
• Tally Accounting Reports View in Browser (TRIB) : Selected popular Reports (like Bills Receivable & Payable, Stock Summary) may be viewed / downloaded from a web browser, on any device, anywhere.
• Remote Access of Tally Accounting System : Some frequently used Tally Reports may be viewed using any Browser, accessing another Licensed Tally installation with Tally.NET, as per access permissions.

Exclusive Features of Tally Business Accounting Software

We have described some important features of computerised business Accounting Software, in general. Apart from these, Tally provides some of its own innovative features to meet the special needs of Indian Businessmen, which are neither found, nor followed by accounting communities or in text books. These features are provided to meet the special need of Indian business community. These are briefly described in next sections in this book.