Tally Interview Question and Answers

Explore Best Tally Interview Questions and Answers covering Tally Prime, GST, and accounting features. Prepare smartly for fresher and advanced level interviews.

Beginner Level Tally Interview Questions

1. What is Tally?
  Tally is an accounting software used for recording financial transactions, generating reports, and managing business operations efficiently.
2. What does ERP stand for in Tally?
  ERP stands for Enterprise Resource Planning, meaning Tally manages accounting, inventory, payroll, and taxation in a single system.
3. Which is the latest version of Tally?
  The latest version is Tally Prime, replacing Tally ERP 9 with a simpler interface and improved features.

4. What are the main features of Tally Prime?
User-friendly design

- Multi-tasking capabilities

- Remote access and data security

- Simplified GST and e-invoicing.
  - 5. What is a Company in Tally?
- A company represents the business entity in which all accounts and transactions are recorded.

- How to create a company in Tally?
  Go to Gateway of Tally → Create Company → Enter business details → Save

- What is a Ledger in Tally?
  A ledger is an account head used to record transactions — e.g., Sales, Purchase, Cash, Bank.

- How to create a Ledger in Tally?
  Gateway of Tally → Accounts Info → Ledgers → Create.

- What is a Voucher in Tally?
  A voucher is a document that records a financial transaction in Tally.

- How many types of Vouchers are in Tally?
  - - Payment
  - - Receipt
  - - Contra
  - - Journal
  - - Sales
  - - Purchase
  - - Credit Note
  - - Debit Note

- What is a Group in Tally?
  A group is a classification of ledger accounts for organizing financial data.

- How many predefined groups are there in Tally?
  Tally provides 28 predefined groups under the balance sheet and profit & loss categories.

- What is the Shortcut to Create a Ledger in Tally?
  Press Alt + C while in a voucher entry screen.

- What is a Trial Balance?
  A trial balance shows the total debit and credit balances of all ledgers to verify arithmetic accuracy.

- What is a Balance Sheet?
  It is a financial statement showing assets, liabilities, and capital at a given date.

- How to activate GST in Tally?
  Go to F11 → Statutory Features → Enable Goods & Services Tax (Yes).

- What is a Contra Entry?
  It represents transactions within cash and bank accounts (e.g., Cash Deposit, Cash Withdrawal).

- What is a Journal Entry?
  It records non-cash adjustments like depreciation or outstanding expenses.

- How to record a Sales Entry in Tally?
  Use Sales Voucher (F8) → select ledger accounts → enter details → save.

- What is a Receipt Entry?
  It records money received from customers, bank, or other sources.

- How to delete a Voucher in Tally?
  Select the voucher → press Alt + D → confirm deletion.

- What is a Cost Centre?
  It is a department or unit where costs are accumulated for analysis.

- How to enable Cost Centre in Tally?
  Go to F11 → Accounting Features → Maintain Cost Centres (Yes).

- What is the purpose of the Gateway of Tally?
  It is the main screen that provides access to all Tally functions.

- What is Inventory Management in Tally?
  It helps manage stock, product details, quantity, and valuation.

- What is a Debit Note?
  Issued when goods are returned to a supplier or overcharged.

- What is a Credit Note?
  Issued when goods are returned by a customer or overbilled.

- How to Backup Data in Tally?
  Go to Gateway → F3 (Company Info) → Backup → Select Path → Enter Folder Name → Save.

- How to Restore Data in Tally?
  Gateway → F3 (Company Info) → Restore → Select Backup File → Load.

- What is the use of F11 and F12 keys in Tally?
  F11 – Features configuration F12 – Advanced configuration options

Advanced Level Tally Interview Questions

What is the difference between Tally ERP 9 and Tally Prime?
Tally Prime offers a simplified interface, faster navigation, and improved GST/e-invoice features.

What are the key advantages of Tally Prime?
- Real-time data access
- Improved search and reports
- Simplified user experience
- Enhanced data security

How to manage multiple companies in Tally?
You can create or load multiple companies and switch between them using F3: Company Info.

What is the Audit Trail in Tally Prime?
It tracks all modifications made to accounting entries for audit transparency.

What is the use of Tally Vault?
It provides password protection and encryption for company data.

Can Tally work in multi-user mode?
Yes, using Tally Server 9, multiple users can access the same data simultaneously.

How to enable Payroll in Tally?
Go to F11 → Payroll Features → Enable Payroll Processing (Yes).

What are the components of Payroll in Tally?
- Employee creation
- Attendance
- Salary structure
- Pay slips
- Statutory deductions

What is TDS in Tally?
Tax Deducted at Source – an indirect method of collecting income tax.

How to enable TDS in Tally?
Go to F11 → Statutory Features → Enable TDS (Yes).

What is VAT in Tally?
VAT stands for Value Added Tax, applicable before GST implementation.

What are the types of Stock Valuation Methods in Tally?
- FIFO (First In, First Out)
- LIFO (Last In, First Out)
- Weighted Average
- Simple Average

What is the purpose of Reorder Level in Tally?
Helps maintain minimum stock quantity and avoid stock-outs.

What are the steps for Reconciliation in Tally?
Go to Bank Reconciliation → Match copyright transactions with company records.

What is the function of ODBC in Tally?
ODBC (Open Database Connectivity) allows data sharing with other software like Excel.

How can you import or export data in Tally?
- Import: XML format
- Export: XML, Excel, or CSV format

What is Remote Access in Tally?
Enables users to access company data from anywhere through Tally.NET.

What is GST Return Filing in Tally?
Generates GSTR-1, GSTR-3B, and other reports automatically for filing.

How to view Profit & Loss Report in Tally?
Gateway of Tally → Reports → Profit & Loss Account.

What is the difference between Cash Flow and Fund Flow?
- Cash Flow shows movement of cash
- Fund Flow shows overall changes in financial position

What are the advantages of using Cost Categories?
Helps track income and expenses across multiple departments or projects.

How to use Budgeting in Tally?
Gateway → Accounts Info → Budgets → Create.

What are Memorandum Vouchers?
Provisional entries that do not affect accounts until converted.

What is the difference between Optional and Memorandum Vouchers?
- Optional: Editable and convertible
- Memorandum: Used for reference or approval

How to use Interest Calculation in Tally?
Enable Interest Calculation in ledger creation for automatic computation.

What is Job Costing in Tally?
Used to track cost, materials, and expenses for individual projects.

What is Job Work in Tally?
Refers to manufacturing or service processes done on behalf of another company.

What are Statutory Masters in Tally?
Contain all tax-related configurations (GST, TDS, Payroll, etc.).

What is the use of the F4–F10 Function Keys?
- F4: Contra
- F5: Payment
- F6: Receipt
- F7: Journal
- F8: Sales
- F9: Purchase
- F10: Reversing Journal

What is Data Synchronization in Tally?
Used to update and share data between different Tally locations.

Tally Technical Interview Questions and Answers

What programming language is Tally built on?
Tally is developed using Tally Definition Language (TDL).

What is TDL?
Tally Definition Language allows customization and extension of Tally functionalities.

What is the purpose of Tally Server 9?
It ensures faster, secure, and multi-user access to company data.

What are the benefits of Tally Server 9?
- Improved speed
- Secure data handling
- Concurrent user access

What is Tally.NET ID?
A registered user ID to access Tally services such as remote access, synchronization, and updates.

How to configure e-Invoicing in Tally Prime?
Enable e-Invoice under F11 → Statutory Features → Enable e-Invoicing (Yes).

What is the purpose of the Tally ODBC Driver?
Allows other applications (like MS Excel) to fetch Tally data directly.

What is XML in Tally?
Tally uses XML format for importing and exporting data.

What is the function of the Tally Gateway Server?
Manages Tally licenses and user sessions in a network setup.

What is a Remote Company in Tally?
A company accessible online via Tally.NET credentials.

What are Tally Audit Features?
Allow auditors to review, approve, and track changes in accounts.

What is the purpose of Tally Logs?
Store activity records to trace user actions and system changes.

Can Tally integrate with Excel or SQL databases?
Yes, using ODBC connectivity and data export options.

What is the use of Tally SDK?
It allows developers to build and integrate third-party applications with Tally.

What is the difference between TDL and XML customization?
- TDL – Internal code customization
- XML – Data exchange and migration

What is the meaning of API in Tally?
API (Application Programming Interface) enables external software to interact with Tally.

What is Tally Audit Trail?
A chronological record of all financial data changes for compliance.

What are the security levels in Tally?
- Owner: Full access
- Data Entry: Restricted access

How to troubleshoot data corruption in Tally?
Use Tally Data Repair Utility (Ctrl + Alt + R) to rebuild damaged data files.

What are best practices for Tally data maintenance?
- Regular backup
- Password protection
- Update software frequently
- Audit and reconcile monthly

Conclusion

Tally interviews test not only accounting knowledge but also practical software skills. By preparing these 80 professional questions and answers, candidates can confidently handle beginner to advanced-level interviews in accounting and finance roles