Creation of company in Tally ERP 9

Creating a Company In 
Tally ERP 9

The crucial part of Tally is to create a company (Here company refers to any organization of entity or even a person whose books are to be maintained in Tally.)Without creation of a company user can’t book any kinds of transactions. So here I am to tell you that ‘How to create a company’?Creating a Company involves providing basic information about the company whose books of accounts are to be maintained in Tally.ERP 9.
Go to Gateway of Tally > (Alt+F3) Company Info. > Create CompanyThe Company Creation screen is shown below:

Fig 1: Creation of Company

A detailed information of each field is discussed below:

Directory

It is the data path where you want the company to be created.

When you create the company this field is skipped. But if you want to change it, use the Backspace key and modify it to the path required by you.

This is referred to as the Tally Anywhere concept – which is the ability to create/load companies in separate directories. You may press Backspace to give a new path and work from there.

Name

Enter the name of the company whose books are to be managed. If you are a professional accountant and are maintaining the books of your clients then give the Client Company's name.

Mailing Name and Address

In addition to the Company Name, Tally.ERP 9 provides the facility to enter the Mailing Name field. It displays the Company Name by default. You may change it as required, if the mailing name is different from the Company Name. The mailing name and address details are picked up for inclusion in any report that needs the company name and address as heading. For example: Balance Sheets, Statement of Accounts, Ledgers, Cash Flows and so on.

Statutory compliance for

Select the Country from the List of Countries. The Statutory Features and Base Currency Symbol are enabled in accordance with the country selected. For example, if the accounts belong to a company in India, the base currency would be Indian Rupees. The Base Currency will appear with respect to the Country selected.

Selecting India from the List of Countries brings up a State, Pin Code and Telephone No. field.

State

You can select the appropriate state from the predefined list.

PIN Code

Specify the PIN Code (Postal Index Number) of the specified address.

Telephone

Enter the Telephone number.

Mobile No

Enter the mobile number of the company.

E-mail Address

Enter the E-mail address that will be used to e-mail documents, reports and data from Tally.ERP 9.

Enable Auto Backup

Set this to Yes, if you want to enable the automatic backup of Tally.ERP 9 data (per company). Else, set this to No. The data backup is stored in the data folder of the respective company. The auto backup data can be restored by pressing Ctrl+Alt+K from Company Info menu or Gateway of Tally.

Currency

Currency symbol is the symbol of the base currency, that is, the currency that will be used to maintain the books of account.

Maintain

Tally.ERP 9 displays a drop down for the Type of Company with two options Accounts only and Accounts with Inventory

Select Accounts only if you do not have any inventory transactions (suitable for professionals and corporate offices).

However, at a later date (if required) you can choose to alter the information as Accounts-with-Inventory. Select Accounts-with-Inventory, to maintain both financial accounts and inventory.

Financial Year From

In most countries, the books of accounts of a company are maintained for a stipulated period like, 12 months, 15 months, and so on.  This stipulated period is referred to as the Financial Year.

In most countries it is 12 months. Tally.ERP 9 automatically considers 12 months from the date you give here as the Financial Year.

Tally.ERP 9 allows you to maintain data for multiple years by changing the period (Alt+F2) at the Gateway of Tally. In addition, you can also specify the date of actual establishment of the company (date of incorporation).

Books Beginning From

Tally.ERP 9 presumes that you wish to maintain books from the beginning of the financial year. Hence, Tally.ERP 9 displays the date given in Financial Year From field automatically.

The date for Books beginning from can be changed, in case of companies, which are incorporated in the middle of the year. If your company is new, you can opt to start the books of accounts from the date of actual establishment of the company (date of incorporation). You are allowed to give opening balances of all Ledger accounts including Revenue accounts.

Tally Vault Password

Tally Vault is an enhanced security system, which allows for encryption of the company data. Encryption involves converting normally accessible Tally information into unrecognisable information, which can only be reconverted by authorized persons.

Give a password here and repeat the same in the Repeat field. This basically results in the creation of an encrypted company whose information is not accessible to users other than the password holder.

Password Strength

PasswordStrength indicator is available in Tally.ERP 9 from Release 4.5 onwards. Now, strength is displayed while creating / altering passwords under Security Control, Tally Vault, and Control Centre. Also when Password Policy is enabled, Password Strength is indicated in the Change Password screen that appears for first time login.

Use Tally Audit Features

Tally Audit allows the administrator or an auditor profile user to track changes in accounting information. If you wish to use this facility, select Yes. Tally Audit will be available only to the administrator/auditor, through Display of Statements of Accounts.For more information refer Data Management in Tally.ERP 9.

Disallow opening in Educational mode ?

Set this option to Yes, if you don't want the company to be opened in Educational mode of Tally.ERP 9. Else, set this to No.

Base Currency Information

The Base Currency Information is found in the bottom frame of the Company creation Screen. Base Currency is the currency in which your accounts would be maintained. Financial statements are prepared in the base currency by default and these are normally required to be submitted to local statutory authorities. The Base Currency information in Tally.ERP 9 varies with the country selected for Statutory Compliance.

You can record transactions and raise invoices in foreign currency; and also maintain bank accounts or ledgers in foreign exchange, when required.

Base Currency Symbol

The currency symbol given earlier in the Company Creation screen is displayed here automatically.

Tally. ERP 9 uses this currency symbol in reports, wherever necessary.

Formal Name

Formal Name is the full name of the currency specified.

The Formal Name for the base currency is set to Indian Rupees for Indian Companies.

Number of decimal places

The number of decimal places for the base currency is set to 2, by default. However, you have the option of specifying up to 4 decimal places. Indian currency has 2 decimal places whereas certain other countries require 3 decimal places and so on.

Is Symbol Suffixed to Amounts

For countries, which specify the symbol after the amount (value) – this facility is provided. For example, Rs. is specified before the amount (Rs.5000).

Symbol for Decimal Portion

Enter the symbol for decimal portion.

Show Amounts in Millions

This is useful for companies, which require reporting the financial statements in millions. This is possible only if Allow Multi-Currency is enabled in F11: Accounting Features.

Put a space between Amounts and Symbol

This facility is provided to users who require a space between the amount and the symbol. However, putting a space between the amount and symbol could give an opportunity for misuse in case of cheque printing. Hence, the flexibility to turn this option on and off as required is provided.

Decimal Places for Printing Amounts in Words

You can specify the number of decimal places for printing the amount in words. This number should be equal to or lesser than the number specified in Number of Decimal places field in company creation or currency master screen which will appear in Invoice and Cheque printing screen.

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