ERP (Enterprise Resource Planning) and EAS (Enterprise Accounting System)
Enterprise Accounting System (EAS) in India
EAS (Enterprise Accounting System) refers to Integrated Accounting system in which various component modules are closely integrated through a common database.
ERP (Enterprise Resource Planning), is a new buzz word. EAS (Enterprise Accounting System) and ERP are often confused and interchanged. ERP Enterprise Resource Planning, while EAS stands for Enterprise Accounting System. ERP stresses on Planning, activities planned to happen in future while Accounting stresses on Activities which has happened. Here we explain the salient and key aspects of ERP and EAS finally looks at Tally ERP, a popular EAS, touted as ERP.
What is an ERP System
ERP systems are very extensive. Normally, ERP system cove the following basic modules for enterprise management.
- Sales & Marketing
- Customer Relationship Management (CRM)
- Supply Chain Management (SCM)
- Logistics & Distribution
- Production Planning
Tally ERP System
However, Tally.ERP 9, provides core functionalities of Accounting, with some reports for control and management.
- Sales Management : Tally just provides accounting reports of Receivable and Age Analysis, but does not provide for measures for efficient recovery of Overdue Receivables. Tally does not provide even basic features of Lead Management, basic features of CRM, Customer rating in respect of Payment timeliness, Orders consistency, etc. Tally does not provide for Optimum Price planning, Discounting scheme, Sales Campaigns.
- Purchase Management : Tally just provides Ordering & Order System, including Outstanding Orders statements for Orders follow up & Tracking. It does not provide for vendor performance on basis of repeat orders, critical parameters like, Product Quality, Delivery timeliness, Returns, Rejections, Logistics, etc.
So, you should not expect high of Business Planning features in Tally.ERP 9, despite the name ERP attached to it. Even for Accounting, Tally lacks Depreciation & Asset Accounting module, an essential statutory requirement of Accounting System.
Is Tally an ERP System ?
With this definition and objective in mind, we may say Tally.ERP 9, cannot be said as ERP, but an ERA (Enterprise Resources Accounting), as it integrates accounting of all business functions in a centralized data base.
An ERP software provides solutions for various facets of business operation management, including product planning, development, manufacturing, sales, marketing, manpower, etc.in a single database, application and user interface.
Tally does not provide functions related to planning the aspects of planning like sales & marketing, Product Development, Logistics & Distribution, CRM, Production planning, normally provided by ERP Systems. Tally provides extensive functionalities of an Integrated Accounting System, providing historical reports of what has happened in the past, but does not focus much to extend, expand, and improvement for future.
Enterprise Accounting System (EAS) is new ERP Avtar
However, the term ERP has become catchy and sexy. Now-a-days, many of the Integrated Accounting Software, with a centralised database for various business management modules, which can be accessed by multiple users, simultaneously, from multiple location are called as ERP. Some of the them are really Accounting Software, with very little or negligible focus on planning, with glamourous word ERP attached into it, notwithstanding.
In the same sense, Tally cannot be termed a true ERP. Though Tally provides a module for Budgeting, but that is merely to compute variances of planned and achieved figures. Tally does not provide to model Budget Figures in respect of Money, Manpower, Materials and other resources, or operational processes, based on future plans.
Some of the exclusive features available in ERP, in respect of planning, which are not available in Accounting Software (including Tally.ERP9), like : Distribution process management, Supply chain management, Optimum Product Price & Discount planning. Supporting modules for Project planning, Work Flow management, Simplifying & reducing purchase cycle and purchase cost, Human resources management.
Features of Tally ERP System
We have just tried to explain Enterprise Accounting vs Enterprise Planning, to remove some mystified conception of ERP. Some of the special features of Tally ERP, which extends its enterprise capability
- Budgeting : Reverse Journal, Scenario Management, providing limited capability of modelling Budget like features (but no empirical method to compute & model resource plans & budgets on basis of related parameters).
- Enterprise Connectivity : Tally provides features to integrate and manage multi location Tally installation like : Tally Server, Remote Access, Control Centre, Support Centre, Security Control, Auditors’ Edition, Multi Language capability (very limited).
- Support : Tally provides extensive on line & off line support. Support incudes on line person to person phone conversation (a rare feature now-a-days), Off line general support through searchable Help documents, Blogs, Video Tutorials, Webinars. End to end solution of Specific cases through trackable case tickets.
- External Data Connectivity : Tally provides limited Interface with Government data base (like GST), Banks, but not well integrated with payment gateways and electronic transfers.
Tally is not cloud based. Tally is deployed user’s own server.
However, realising that it was wrong to name Tally as ERP, the newer version of Tally was renamed as Tally PRIME, with some additional features. However, in core, it is still an EAS System, not an ERP.