Vocational Course Accounts (V999110)

Accounts & Tally

Unit 6

Tally Prime offers a wide range of banking features that help businesses manage their bank-
related transactions efficiently. These features simplify bank reconciliations, online
payments, and other banking operations, improving accuracy and reducing manual effort.
Summary of Banking Features in Tally Prime:
1. Auto Bank Reconciliation.
2. Cheque Management (Printing, PDC handling, Cheque Register).
3. E-Payments (NEFT, RTGS, IMPS).
4. Deposit Slips (for cheque/cash deposits).
5. Payment Advice generation.
6. Banking Dashboard (comprehensive overview).
7. Multi-Currency Banking.
8. Post-Dated Cheques (PDC) Management.
9. Banking Reports (Reconciliation, Cheque Summary).
10. Interest Calculations.
11. Auto Allocation of Payment/Receipt Amounts.
These banking features help businesses manage their financial operations efficiently,
ensuring smoother workflows for payments, receipts, bank reconciliation, and reporting.
1. Auto Bank Reconciliation
• Auto Bank Reconciliation allows users to easily match their company’s bank ledger
with bank statements. This feature helps in automating the reconciliation process,
saving time and reducing manual errors.
• You can import the bank statement directly in Tally Prime in various formats (Excel,
CSV, or direct bank feeds), and the software automatically reconciles the entries.
Steps:
• Go to Gateway of Tally > Banking > Bank Reconciliation.
• Select the bank account and import the statement for reconciliation.
Benefits:
• Automatically matches entries and highlights discrepancies.
• Reduces reconciliation time significantly.
2. Cheque Management
• Tally Prime provides comprehensive cheque management functionalities to handle
issued, printed, and deposited cheques. Users can manage post-dated cheques, print
cheques, and track cheques status.
Key Functions:
• Cheque Printing: You can print cheques directly from Tally in the format supported
by your bank.
• Cheque Register: Keep track of all issued and received cheques.
• Post-dated Cheque (PDC) Management: Tally allows you to handle post-dated
cheques with ease, making it simpler to track future payments and collections.
Steps:
• Go to Gateway of Tally > Banking > Cheque Printing or Cheque Register.
3. E-Payments
• Tally Prime supports electronic payments by enabling businesses to transfer funds
directly through NEFT, RTGS, IMPS, and other online payment methods. This feature
helps you process payments directly to vendors, employees, and others from within
the software.
Key Features:
• Generate payment advice for all e-payments.
• Supports formats like XML, Excel, or direct integration with banks.
• Tally generates a unique transaction reference number (UTR) for tracking the
payment.
Steps:
• Go to Gateway of Tally > Accounting Vouchers > F5 (Payment).
• Select the appropriate Bank Ledger and choose the Mode of Payment as NEFT, RTGS,
IMPS, etc.
4. Deposit Slips
• You can generate bank deposit slips in Tally Prime for cheque or cash deposits. This
simplifies the process of depositing cheques and cash into the bank, making it
convenient for businesses to handle multiple deposit transactions.
Steps:
• Go to Gateway of Tally > Banking > Deposit Slip.
• Select the bank, enter details of cash or cheque deposits, and print the deposit slip.
5. Payment Advice
• The Payment Advice feature allows you to generate and send payment advice notes
to vendors or suppliers when making payments. This note serves as a record of
payment, detailing the transaction for the recipient.
Steps:
• After entering the payment voucher, Tally generates an option to print or email the
Payment Advice to the relevant party.
6. Banking Dashboard
• Tally Prime provides a Banking Dashboard to give an overview of all bank-related
activities in one place. It allows you to view:
o Bank balances across multiple accounts.
o Pending cheques for clearance.
o Reconciliation status.
Steps:
• Go to Gateway of Tally > Banking to view the banking dashboard.

7. Post-Dated Cheques (PDC) Management

• Tally Prime allows you to manage post-dated cheques effectively. You can record
these cheques without impacting your financial books until the cheque is cleared.
Features:
• Tracking Post-Dated Cheques: Separate lists for issued and received PDCs.
• Automatically updates the financial statements on the PDC realization date.
Steps:
• Go to Gateway of Tally > Banking > Post-Dated Cheque Summary.
8. Banking Reports

• Tally Prime offers various reports to manage banking activities efficiently:

o Bank Reconciliation Reports: A detailed report showing reconciled and
unreconciled bank transactions.
o Cheque Summary: Provides an overview of cheques issued and deposited.
o Cash and Bank Books: Tracks bank and cash balances and transactions.
Steps:
• Go to Gateway of Tally > Display > Account Books > Cash/Bank Books.

9. Interest Calculations

• For companies that need to calculate interest on loans or overdrafts, Tally Prime offers
bank interest calculation features. You can calculate interest for both incoming and
outgoing bank loans, allowing you to track and manage interest payments efficiently.
Steps:
• Set the interest parameters under Gateway of Tally > Accounts Info > Ledgers >
Create/Alter.

10. Auto Allocation of Amounts

• When making payments or receipts, Tally automatically allocates the payment against
outstanding bills and invoices, ensuring smooth transaction handling.

Based on the construction project for ABC Construction Pvt. Ltd., we can demonstrate the
banking features of Tally Prime using relevant entries, particularly focusing on the
transactions like payments to suppliers, receipts from customers, and bank reconciliations.
Here's a step-by-step breakdown of the banking features in use:
1. Auto Bank Reconciliation
Let's assume ABC Construction Pvt. Ltd. has a bank account with HDFC Bank. The company
received payments from XYZ Developers and paid Sharma Cement Suppliers via bank
transfers. You will use Auto Bank Reconciliation to reconcile these transactions.
Steps:
• Go to Gateway of Tally > Banking > Bank Reconciliation.
• Select the HDFC Bank Account.
 • Import the bank statement in CSV or Excel format.
• Tally will match the bank entries with your voucher entries and reconcile
automatically.
Example:
• Payment received from XYZ Developers (₹3,00,000) was recorded on 10th April
2024.
• Payment made to Sharma Cement Suppliers (₹50,000) on 15th April 2024.
After reconciliation, any discrepancies between the bank statement and the recorded
transactions will be highlighted.
2. Cheque Management
ABC Construction issues cheques to suppliers and subcontractors and also receives cheques
from clients like XYZ Developers. Tally's cheque management feature helps handle these
transactions effectively.
Example Entry:
• The company issued a cheque to ABC Subcontractors for ₹1,00,000 on 18th April
2024 for services rendered.
Steps:
• Go to Gateway of Tally > Accounting Vouchers > F5 (Payment).
• Select Bank Ledger (HDFC Bank) and choose the mode of payment as Cheque.
• Enter the amount (₹1,00,000), the cheque number, and the details of the party.
• Tally will store this entry in the Cheque Register, where you can track the status of
issued cheques.
Additionally, for received cheques from customers like XYZ Developers, you can:
• Go to Gateway of Tally > Accounting Vouchers > F6 (Receipt).
• Select the Bank Ledger and the Cheque as the payment mode.
3. E-Payments (NEFT/RTGS/IMPS)
Let’s assume ABC Construction made an NEFT payment of ₹50,000 to Sharma Cement
Suppliers.
Steps:
• Go to Gateway of Tally > Accounting Vouchers > F5 (Payment).
• Select the Bank Ledger (HDFC Bank) and choose NEFT as the payment mode.
 • Enter the party details (Sharma Cement Suppliers), payment amount, and NEFT
transaction reference number.
Tally will also allow generating a Payment Advice after this entry:
• After recording the voucher, click on the Payment Advice button.
• Generate and email the payment advice to Sharma Cement Suppliers as a record of
the payment.
4. Post-Dated Cheque (PDC) Management
Let’s assume ABC Construction received a post-dated cheque of ₹2,00,000 from XYZ
Developers with a cheque date of 30th April 2024. Tally's PDC feature helps manage this
transaction without affecting your current financials until the cheque's actual realization.
Steps:
• Go to Gateway of Tally > Accounting Vouchers > F6 (Receipt).
• Select the Bank Ledger (HDFC Bank) and choose the Cheque as the mode of
payment.
• Enter the cheque date as 30th April 2024 and the amount (₹2,00,000).
Tally will automatically place this cheque in the Post-Dated Cheques Summary and only
reflect the financial impact on 30th April.
To view the PDC list:
• Go to Gateway of Tally > Banking > Post-Dated Cheque Summary.
5. Deposit Slips
If ABC Construction collects multiple cheques from various clients and wants to deposit them
in the bank, Tally's Deposit Slip feature will help.
Steps:
• Go to Gateway of Tally > Banking > Deposit Slip.
• Select the HDFC Bank.
• Enter the details of cheques received, including party names (e.g., XYZ Developers)
and amounts.
This feature helps you generate a printable deposit slip to submit to the bank.
6. Payment Advice
When making payments to subcontractors and suppliers, Tally allows generating a Payment
Advice, which is a formal note detailing the transaction. Let’s consider the payment to
Sharma Cement Suppliers (₹50,000).
Steps:
• After entering the payment voucher in Tally (as shown in Cheque Management or E-
Payments):
• Click on Alt+P (Print) to generate a Payment Advice.
• This document can be sent to the supplier via email or printed for record purposes.
7. Banking Reports
Tally provides detailed banking reports, including reconciliations and summaries of
transactions.
Key Reports:
• Bank Reconciliation Report: Tracks reconciled and unreconciled bank entries.
• Cheque Summary: Displays issued and received cheques, along with their status.
• Cash/Bank Books: Tracks transactions and balances in HDFC Bank or other
accounts.
Steps:
• Go to Gateway of Tally > Display > Account Books > Cash/Bank Books to view a
list of all bank transactions.
Example:
ABC Construction Pvt. Ltd.
HDFC Bank Account (1-Apr-2024 to 30-Apr-2024)

Date Particulars Debit Credit Balance

----------------------------------------------------------------------
01-Apr-24 Opening Balance ₹0
10-Apr-24 XYZ Developers (Receipt) ₹3,00,000 ₹3,00,000
15-Apr-24 Sharma Cement Suppliers (Payment) ₹50,000 ₹2,50,000
18-Apr-24 ABC Subcontractors (Payment) ₹1,00,000 ₹1,50,000
30-Apr-24 XYZ Developers (PDC Realized) ₹2,00,000 ₹3,50,000
----------------------------------------------------------------------
Closing Balance ₹3,50,000