Learn Tally.ERP 9 by running a real supermarket for one month.

Everything in this workbook happens inside one business. Learning Tally with invented numbers is how most people fail at it. Learning with a shop you can picture, on a street you know, is how it sticks.

The client

Mr. Julius Tumusiime has been trading in Mbarara for eleven years. In July 2025 he opens a new self service supermarket on High Street, two doors from the taxi stage. Until now his records lived in a hardcover book and on the back of delivery notes. His bank wants monthly accounts, URA wants a VAT return by the fifteenth of every month, and he has just hired a cashier he barely knows. So he buys Tally.

The three products you will trade

A real supermarket carries four thousand lines. You will carry three, because three is enough to learn every rule and few enough to check by hand. Add the rest once you trust yourself.

What July looks like

Eighteen transactions, spread over the first two weeks of trading plus one month end adjustment. You will enter every one of them.

Tally is a bookkeeping and inventory program built around one idea: you type a transaction once, as a voucher, and every report in the system updates the instant you press Enter. There is no posting run, no month end rebuild, no separate stock system to reconcile. That single design choice is why a shop in Mbarara and a distributor in Kampala can both run on it.

Which version am I looking at?

Tally.ERP 9 is the release most Ugandan businesses still run, usually Release 6.x. Its successor, TallyPrime, arrived in 2020 and moved the menus around, but the accounting logic, the group structure and the voucher types are the same. Learn ERP 9 properly and you can sit down at TallyPrime and be productive in an hour. Check yours from the top right of the screen or press Ctrl + Alt + B for the build number.

Starting up

Double click the Tally icon. If a company already exists on the machine you land on the Gateway of Tally. If none exists, Tally opens the Company Info menu and waits for you to create one, which is Module 02. Educational mode runs without a licence but restricts you to the first, second and last day of a month, so for this workbook use a licensed or trial install if you can.

Anatomy of the Gateway

Click each numbered marker on the screen below. Everything you will ever do in Tally starts from this one screen, so spend a minute here.

Moving around without touching the mouse

Tally was built for speed by people who never lift their hands from the keyboard, and it still rewards that. A cashier who navigates by mouse will be half as fast as one who does not.

Walk the menus yourself

The simulator below behaves like the real thing. Click a menu item to go in, use the Esc button to come back out. Get the paths into your fingers now and Modules 03 to 08 will feel like revision.

In Tally a company is one set of books. It is not a legal concept. If Mr. Tumusiime later opens a hardware shop, that is a second company in Tally even though it is the same man and the same TIN. Everything you build from here lives inside the company you are about to create.

From the Gateway of Tally press Alt + F3 to open Company Info, then choose Create Company. If Tally started with no company at all, this menu appears on its own.

Screen · Company Info menu (Alt+F3)

The Company Creation screen, filled in for Rwizi Fresh

Type exactly what you see in the yellow fields. The fields are explained underneath.

Screen · Company Creation

Field by field

After you accept

Tally saves the company and drops you at the Gateway of Tally with the new name showing in the top right panel. Two ledgers already exist, created automatically: Cash and Profit & Loss A/c. You never create those two.

Every amount in Tally lands in a ledger. Every ledger sits under a group. The group decides where the ledger appears in the Balance Sheet or the Profit and Loss, so choosing the group correctly is the single most important decision in the whole system. Everything downstream, every report, every ratio, follows from it.

Put it plainly. Mukwano Industries Ltd is a ledger. It sits under Sundry Creditors, which sits under Current Liabilities. So when you owe Mukwano money, it shows on the liabilities side of the balance sheet without you telling Tally anything more.

The 28 groups Tally gives you

Fifteen primary groups and thirteen subgroups. You will rarely need to create your own. Learn where things go instead.

Creating a ledger

Path: Gateway of Tally > Accounts Info. > Ledgers > Create

Tally offers Single Ledger and Multiple Ledgers. Use Single for the first few so you see every field. Use Multiple later to type twelve expense ledgers in one screen, which is far quicker.

Screen · Ledger Creation, creating Mukwano Industries Ltd

Maintain balances bill-by-bill is worth switching on for every customer and supplier. It makes Tally track each invoice separately rather than as one running total, which is what lets you answer the question every shop owner asks: which invoices are overdue, and by how many days.

The full chart of accounts for Rwizi Fresh

Create these seventeen ledgers now. Cash and Profit & Loss A/c already exist, so do not create them again.

Setting up the two VAT ledgers properly

These two do the arithmetic for you, so get them right. When you create VAT Payable (Output 18%) under Duties & Taxes, Tally opens three extra fields:

• Type of duty/tax: Others. Uganda VAT is not one of Tally's built in statutory types, and Others behaves exactly as you need.
• Percentage of calculation: 18%.
• Method of calculation: On Total Sales. This tells Tally to apply 18% to the value of the goods on the invoice.

Repeat for VAT Claimable (Input 18%). From then on, when you add the VAT ledger to a sales or purchase invoice, Tally fills the amount in by itself.

Drill · which group does it go under?

Nine ledgers a supermarket really uses. Pick the group for each. This is the skill that separates people who can use Tally from people who can only type into it.

A supermarket without inventory in Tally is a supermarket that cannot tell you what is on the shelf, what is expiring, or what the shrinkage was. Build the stock masters in this order, because each one depends on the one before it: Units of Measure, then Stock Groups, then Godowns, then Stock Items.

Step 1 · Units of Measure

Path: Gateway of Tally > Inventory Info. > Units of Measure > Create

A simple unit is a single thing you count. Create these four:

A compound unit is one unit expressed in another, and it is the feature supermarkets need most. Soda arrives in crates and sometimes sells as single bottles. Set the unit type to Compound and define:

Screen · Unit Creation, compound unit

Now Tally understands that one crate is twenty four bottles. Sell eighteen bottles and it will report the balance as 0 Crt 6 Btl, not as a fraction of a crate. Ask any shopkeeper which of those two he can act on.

Step 2 · Stock Groups

Path: Inventory Info. > Stock Groups > Create. Stock groups organise the Stock Summary the way groups organise the balance sheet. Create four, all under Primary:

• Groceries, oil, sugar, rice, flour, salt
• Beverages, sodas, water, juice
• Household & Toiletries, soap, detergent, tissue
• Fresh & Perishables, milk, bread, yoghurt

Set Can quantities of items be ADDED? to Yes only where the items share a unit. Groceries hold jerricans and kilograms together, so answer No there and Tally will stop reporting a meaningless total.

Step 3 · Godowns

Path: Inventory Info. > Godowns > Create. Tally starts with one called Main Location. Rename it or add two more, because a supermarket physically holds stock in two places and the difference matters when goods disappear:

• Main Store, the locked back room where deliveries land
• Shop Floor, the shelves customers reach

Module 08 moves stock between them and explains why the storekeeper should sign for it.

Step 4 · Stock Items

Path: Inventory Info. > Stock Items > Create. This is where the shelf becomes data.

Screen · Stock Item Creation

Standard rates live behind F12 Configure > Allow Standard Rates for Stock Items. Switch it on and Tally will suggest the selling price during invoicing, so a new cashier cannot invent a price at the till.

Costing method, in one paragraph

Avg. Cost smooths the cost of every purchase into one weighted average, which suits a supermarket buying the same oil repeatedly at drifting prices. FIFO assumes the oldest stock sells first and gives a truer closing value when prices move sharply. Last Purchase Cost values everything at the most recent price, which flatters profit when prices are falling and destroys it when they rise. This workbook uses Avg. Cost throughout, and because you buy each item only once in July, the closing values are identical under all three.

Perishables: batches and expiry dates

Now the feature that pays for the software. Bread, milk and yoghurt expire, and a supermarket that cannot see expiry dates loses money quietly. Switch on F11 > Inventory Features > Maintain Batch-wise Details and Set Expiry Dates for Batches, then create a fourth item:

From then on every purchase of milk asks for a batch name, a manufacturing date and an expiry date. Then Display > Inventory Books > Batch Summary shows you, on any morning, which batches expire this week. That report, printed and handed to the shop floor supervisor, is worth more to Mr. Tumusiime than the balance sheet.

New users confuse these two constantly, so learn the distinction once and never worry again.

F11 · Accounting Features

Press F11 from the Gateway, then choose Accounting Features. Set these:

F11 · Inventory Features

F12 · The configuration settings worth changing

A voucher is one transaction. Money in, money out, goods in, goods out, or an adjustment. Choose the right voucher type and Tally does most of the thinking; choose the wrong one and you will fight the software all day.

Path: Gateway of Tally > Accounting Vouchers

Debit and credit, quickly

You need this or nothing below will make sense. Two lines, memorised:

Drill · which voucher type?

Entry 1 · Capital introduced, 1 July, UGX 50,000,000

Mr. Tumusiime transfers his own money into the company's Stanbic account. Money comes in, so it is a Receipt. Press F6. Set the date first with F2, because Tally defaults to today and a voucher dated wrongly is a headache to find later.

Screen · Receipt voucher · entry 1

Keystrokes: F6 → F2 type 1-7-25 Enter → at Account choose Tumusiime Capital A/c → amount 50000000 → at Particulars choose Stanbic Bank → Tally fills the debit → type the narration → Ctrl+A.

Entry 2 · Shop fittings and freezers, UGX 12,000,000

Paid by cheque, so a Payment voucher. Press F5.

Tally will ask for cheque details if you enabled bank allocations. Fill them in. Six months later, when the bank statement does not agree, those details are the only way to find the difference quickly.

Entry 3 · July rent, UGX 1,500,000

Also a Payment. Debit Rent, credit Stanbic Bank.

Entry 4 · Till float drawn from the bank, UGX 4,000,000

Money moved from your bank to your own till. Nothing was earned or spent. That is a Contra, F4.

Screen · Contra voucher · entry 4

Entry 5 · Credit purchase from Mukwano, UGX 15,646,800

This is the first entry that carries goods and VAT, so it is the important one. Press F9 for Purchase, and make sure you are in invoice mode. If the screen shows Dr and Cr columns instead of item lines, press Ctrl + V to switch between As Voucher and As Invoice.

Screen · Purchase voucher, invoice mode · entry 5

Notice what happened when you added the VAT Claimable line. You typed nothing in the amount column. Because the ledger was created under Duties & Taxes at 18% on total sales, Tally worked out 18% of 13,260,000 by itself. That is the payoff for setting the ledgers up properly in Module 03.

Behind the scenes this one screen posts a four line double entry:

And at the same moment 120 jerricans and 600 bars land in the Main Store, valued at cost. One entry, both books.

Entry 6 · Cash purchase from Century Bottling, UGX 3,398,400

Same F9 Purchase voucher, but the party is paid immediately. Set Party A/c Name to Cash, or keep the supplier as the party and add a second Payment voucher settling it the same day. The first is faster; the second gives you a supplier history. For a regular supplier like Century Bottling, use the second.

Build the entry yourself

Three transactions from later in the month. Choose the correct ledger and side for each. No hints.

Sales are where a supermarket lives or dies, and where the tax exposure sits. Press F8 from Accounting Vouchers.

Entry 7 · Day one till sales, UGX 3,801,960

A supermarket does not raise an invoice for every shopper. It rings up hundreds of small sales at the till and posts one consolidated sales voucher per day, per till, taken from the Z reading at close of business. Party A/c Name is Cash.

Screen · Sales voucher, invoice mode · entry 7

Now key entries 8, 12 and 13 the same way:

Entry 9 · Credit sale to Lake View Hotel, UGX 4,906,440

A hotel buys in bulk on account. Same F8, but Party A/c Name is Lake View Hotel Mbarara, and the bill allocation panel appears. Choose New Ref and name it RFS/INV/0009.

Print it with Alt + P. That printed document is the customer's tax invoice, and it must show your TIN, the customer's TIN, the VAT amount separately, and an invoice number.

Entry 15 · The return, UGX 743,400

On 10 July the hotel sends back six jerricans; the seals were broken in transit. Press Ctrl + F8 for a Credit Note. Because you switched on Use Invoice mode for Credit Notes in Module 05, you enter it as goods, not as a lump sum.

Screen · Credit Note · entry 15

Three things happened at once, which is the whole argument for using invoice mode on credit notes. Sales fell by 630,000. Output VAT fell by 113,400. And six jerricans came back into the Main Store, so your stock figure is right again.

Uganda VAT, and how Tally gives you the return

The standard rate is 18%. You charge it on sales (output tax), you pay it on purchases (input tax), and you remit the difference to URA. VAT is not your money and it is not your income; it passes through the business.

Rwizi Fresh, July 2025

Rwizi Fresh owes URA nothing this month. It has a credit of 197,280 because it stocked the shop heavily before it had sold much, which is exactly what a new supermarket does. The return must still be filed. From August, as sales overtake restocking, the position will flip to a payment.

You do not add these figures up by hand. In Tally:

• Display > Account Books > Ledger > VAT Payable (Output 18%) gives the output tax total for the period.
• Display > Account Books > Ledger > VAT Claimable (Input 18%) gives the input tax.
• Change the period with Alt + F2 to 1-Jul-2025 to 31-Jul-2025 first, or you will be reading the whole year.
• Export either with Alt + E to Excel and keep it beside the filed return as your working paper.

Accounting vouchers move money. Inventory vouchers move goods without any money changing hands, and a supermarket needs them constantly.

Path: Gateway of Tally > Inventory Vouchers

Moving stock from the store to the shelf

Every morning the storekeeper carries goods from the Main Store to the Shop Floor. That is a Stock Journal, transfer type, with a source and a destination. It changes no ledger balance at all, and it is the entry that makes theft visible.

Screen · Stock Journal, morning transfer

Physical stock and the shrinkage entry

At the end of the month the team counts the shelves. Suppose the count shows 49 bars of soap where Tally says 50. That one bar is shrinkage: theft, breakage, or a keying error. Record what is really there with a Physical Stock voucher, Alt + F10, and Tally adjusts the book quantity to match the count.

Shrinkage above roughly one to two percent of sales is a signal, not an accounting problem. In a Ugandan supermarket the usual causes are, in order: goods leaving through the back door, cashiers not scanning items for people they know, breakage nobody reported, and receiving short deliveries without checking the lorry. Tally will show you the number. Only management can fix the cause.

Here is the payoff. You entered eighteen vouchers and never once ran a month end process, yet every report below is already finished. Two keys control all of them: Alt + F2 changes the period, and Alt + F1 expands a summary into detail. Learn those two and every Tally report opens up.

Day Book · what did we enter?

Path: Gateway of Tally > Display > Day Book. It lists every voucher for a date or a range. This is the first place to look when something is wrong, and the first thing an auditor asks for.

Report · Day Book, 1 to 12 July 2025

Trial Balance · does it agree?

Path: Display > Trial Balance, then Alt + F1 for the ledger level view and Alt + F2 to set 1-Jul to 31-Jul-2025.

Report · Trial Balance at 31 July 2025, detailed

Stock Summary · what is on the shelf

Path: Gateway of Tally > Stock Summary. Press Alt + F1 for item detail and F7 to show the profit per item.

Oil shows 126 inwards because the 120 purchased were joined by the 6 that Lake View returned. And look at the soda: two crates left. That is the report the shop should read every morning, because a supermarket with an empty soda shelf on a Saturday loses the whole basket, not just the drink.

Profit and Loss Account

Path: Gateway of Tally > Profit & Loss A/c. Tally shows the Trading Account and the Profit and Loss side by side, in the classic T format.

Report · Profit & Loss A/c, July 2025

Read it as a shopkeeper, not an accountant. Goods that cost 12,611,000 were sold for 15,044,000, so the shop made 2,433,000 on the trading itself, about sixteen shillings on every hundred. Running the place for the month cost 2,050,000. What is left, 383,000, is the profit. On a first fortnight of trading against a full month of rent, that is a respectable result, and it tells Mr. Tumusiime his margins can carry his overheads.

Balance Sheet

Report · Balance Sheet at 31 July 2025

Duties & Taxes shows in brackets because input VAT exceeds output VAT. A negative liability is really an asset, the 197,280 URA owes the business, and Tally is honest enough to show it on the side where the group belongs rather than quietly moving it.

Ratio Analysis

Path: Gateway of Tally > Ratio Analysis. Tally computes these from the same data, with no extra work.

The two reports that get a shop paid

• Display > Statements of Accounts > Outstandings > Receivables shows every unpaid customer invoice with its age in days. Lake View's balance of 1,163,040 appears here against invoice RFS/INV/0009.
• ... > Outstandings > Payables does the same for what you owe. Mukwano's remaining 7,646,800 sits here with its due date, and Tally will flag it once it passes thirty days.

Press F6 on either report for the ageing analysis, then Alt + P to print. A supermarket that reviews these two reports every Monday morning collects faster and never gets a surprise supplier suspension.

The month end routine

Tally needs no closing process, but a shop does. Work through this list in order on the first working day of every month, and the accounts stay trustworthy.

1. Reconcile the bank. Display > Account Books > Bank Books, open Stanbic, press F5 for Reconciliation, then enter the date each item cleared. Tally shows the balance as per bank at the bottom. It must equal the statement. Chase any difference the same day.
2. Count the cash. The physical till and safe must equal the Cash ledger balance. Differences go to a Cash Short and Over ledger under Indirect Expenses, never quietly into another account.
3. Count the stock. Compare the physical count to the Stock Summary and post a Physical Stock voucher for the difference.
4. Charge depreciation. One journal, as in entry 18.
5. Empty the Suspense A/c. If anything is sitting there, you did not know where to put it. Find out now, not in June.
6. Read the Outstandings. Receivables and Payables, both with ageing. Act on what is overdue.
7. Extract the VAT figures and file the return by the fifteenth.
8. Print and file the Trial Balance, P&L, Balance Sheet and Stock Summary. Paper survives disk failure.
9. Back up. Then verify the backup by restoring it somewhere else.

Backup and restore

Path: Alt+F3 > Backup. Tally asks for a source directory (where the data lives) and a destination (where the backup goes). It writes a file called TBK900.001 plus an index. Restore is the mirror image: Alt+F3 > Restore, source is the backup folder, destination is where you want the company put.

Users and rights

Turn on Alt+F3 > Alter > Use Security Control: Yes. Tally asks for an administrator name and password, then lets you define security levels under Company Info > Security Control > Types of Security.

Two settings on the Data Entry level do most of the work. Days allowed for back dated vouchers: 0 stops a cashier quietly editing yesterday's takings. Disallow Alter and Delete means a mistake must be corrected by a visible reversing entry rather than made to disappear. Neither setting suggests you distrust anyone. They protect honest staff from suspicion just as much as they deter the dishonest.

Corrections, honestly

In a training file, alter the wrong voucher. In a real business where the month has been reported or the VAT return filed, do not alter history. Post a dated correcting entry with a narration explaining what it fixes. An auditor who finds altered prior period vouchers will question everything else you did; one who finds a clear correcting entry will move on.

July was guided. August is not. Below are eleven transactions with no postings shown. Enter them into the same company, then check your reports against the answer key. Because August falls in the same financial year, Tally carries the July balances forward by itself. You do not enter opening balances.

Before you open the key, answer these three from your own reports: how much does Lake View owe at 31 August, how much VAT must be paid to URA and by what date, and which item must be reordered before Monday.

Written test

Ten questions on everything above. Answer all, then submit.

Test yourself · tap a card to flip it

Glossary