Moving to New Financial Year Accounts in Tally
At Financial Year end, new financial year account data must be created. This is normally done by copying previous year Master Files with Opening balance carried from previous year closing balance. This post explains various alternate methods of creating New Year Financial Year data with opening balances carried from previous year financial year closing balance data, to maintain accounts for new Financial Year.
New Financial Year Accounts in Tally
We have explained creation of New Company for New Financial Year Accounts . Alternatively, at the year end, you may extend Financial Accounting period for the next year to keep next year accounts also in the same Company.
However, for operational convenience & better security, organizations normally prefer to keep separate Data for each Financial Year. You may temporarily extend the Financial Year to enter data of the new Financial Year also in the same Company, till completion of voucher entry of previous year.
The other alternative is to continue entry of voucher for next financial years, keeping everything in one Company. This saves the tasks of creating another company, transferring masters and balance in next year etc. However, this method is suggested only for personal accounts where the volume is less. The accounts are mainly maintained for Tax purposes.
Extension of Financial Year in Tally
Tally creates the Financial Year for 12 Months from the Financial Year From. If you enter 01.04.12 at Financial Year From in Company creation screen, the year end is 31.03.13. Having entered the data for 12-13, you may extend the financial year for 13-14, i.e from 01.04.13 to 31.03.14, by changing Current Period.
Click F2: Period button (or press Alt+F2) to change current period. At To field, enter the next year closing date 31.03.14.
Now you can enter voucher data for the next Financial Year (FY13-14). At any point of time, you may change the Current Period through F2: Period button and work for that period (e.g FY 12-13).
This way, you can start working for new year (e.g FY 13-14), even before the accounts of previous year (FY 12-13) accounts are closed. So, you can enter data in both years simultaneously.
Multiple Financial Year Data in Tally: This way, you can work for both the years simultaneously and you do not have to create new Account Masters (Ledger / Groups). You also do not have to carry the closing balances of previous financial year to Opening Balance of next Financial year, as data for both the financial years are contained in same Tally Company. This way, you may keep data of all the years in ONE Tally Company.
Splitting of Financial Year Data in Tally
However, normally it is preferred to create separate Company for each Financial, instead of keeping Multi Year data in one Tally Company.
After having completed the accounts finally for the current year (i.e. FY 12-13), you may split the Company into 2 years (FY 12-13 & FY 13-14) to make separate new Company for the next Financial Year Company (FY 13-14) with Opening Balances carried from the Closing Balances of previous year (FY 12-13), as described.
Click F3: Cmp Info button to get Company Info Menu and select Split Company Data to get Split Company Data Menu .
Accounts Data Split Menu in Tally
At Split Company Data Menu , select Select Company to get Split Company Data screen . At Split Company Data screen , at Split From field, enter the Date (i.e 1-4-2013) from which the next year Company (FY 13-14) is to be created (i.e First Date of New Year Company
On splitting, Tally creates 2 new Company Data files , showing the progress status (do not interrupt till the process is over). The original company data (combined data before splitting) is also retained.
The Closing Balance (of Real & Personal Accounts, except the Nominal Accounts) of the first part Company is carried to Opening Balance of the 2nd Part Company.
Financial Year Data Splitting in Tally
Financial Year From date is added (suffixed) to the Company Name of the respective Split Company for identification .
The newly created Companies as well as the old extended Company is shown in the list of selected Companies
Financial Year Split Data in Tally
Verification of Split Financial Year Data in Tally
Having split the data, you should check both the split companies to make sure there is no error in any voucher.
- At Company Split Menu. select Verify Company Data to get Verify Company Data screen
- At Verify Company Data screen, at Company Name, select the Split Company to be verified. Tally checks each voucher and lists vouchers where there may be some error or inconsistency in data.
Split Financial data Verification in Tally
After verifying the split Companies, edit the vouchers listed and rectify error, if any.
Deletion of Extended Financial Year Company
Now you have to Delete the Original Company whichcontained complete data of previous year (e.g FY 12-13) and some data of next year also (e.g FY 13-14), entered before splitting
- Click F3:Cmp Info button at Gateway of Tally to get Company Info Menu
- At Company Info Menu, select Alter and select the original Company to be Deleted (e.g Info Consultants – from 1-Apl 2012) to get the Company Alteration screen.
- At Company Alteration screen, press Alt+D and then type Y at the Delete ? to confirm Deletion.
Be careful in Company selection. Don’t delete any of the two newly created split companies !.
Renaming the Multiple Financial Year Companies
Now you have to Rename (change the Company Name) of the newly created split companies (remove the suffixed Period from the name)
- Select the 1st Company – Info Consultants (from 1-4-2011) to get Gateway of Tally of the selected Company
- Click F3:Cmp Info button (or press Alt+F3 keys) at Gateway of Tally, to get Company Info Menu (F-1A/01-01)
|Split Company Name||Rename as|
|Info Consultants 12-13 (from 1 Apr 21012)||Info Consultants 12-13|
|Info Consultants 12-13 (from 1 Apr 21013)||Info Consultants 13-14|
At Company Info Menu, select Alter, select the Company to be renamed, At Name field, change the Company name (e.g from Info Consultants (from 1-4-2011 to Info Consultants 11-12).
In the same way, change the Company name of 2nd Company (e.g from Info Consultants (from 1-4-201) to Info Consultants 12-13)
Transfer of Balances from Previous Financial Year to New Financial Year in Tally
The Closing Balance of all Balance Sheet Accounts (Real & Personal) only of the 1st Part of the Split Company (e.g FY 12-13) will be carried as Opening Balance of 2nd Part of the Split Company (e.g FY13-14). But the Closing Balance of Nominal Accounts will not be carried (Closing Balances of Real & Personal Accounts, appearing in Balance Sheet only will be carried). So, the Balance of all Nominal Accounts in the 2nd split Company (accounts appearing in Profit & Loss Statement) will be zero.
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