Account 4 Marks Question

The menu option available in Gateway of Tally Screen are:

1. Customised accounting software.

The term 'Customised Software' means making changes in the ready to use software so as to suit the specific requirements of the user. Any readymade software can be changed according to the needs and specifications of the user. However, the cost of installation of customised softwares are high because the cost of change is to be paid by the user.

2. Ready to use accounting software.

A variety of readymade softwares is available in the market. These softwares are for users at large and are not developed according to the requirements of any specific user. Most popular readymade softwares available in the market are Tally, Ex. Busy etc.

primary groups in Tally:

1. Capital: Owner's Capital, Partner's Capital, Equity Share Capital, Preference Share Capital comes under it. It is a primary group.

• Reserve & Surplus: It is the sub group of Capital A/c. It includes General reserve, Capital Reserve etc.

2. Loans: It is used to keep the record of the Loans taken by the Company. It is a primary group which contains following sub groups:

• Bank Overdraft: Bank overdraft and cash credit facility taken from bank are placed under this group.
• Secured Loans: The Loans which are taken against a security like mortgage, pledge etc. are placed under it.
• Unsecured Loans: Apart from Secured Loans rest loans are unsecured which come under this subgroup.

3. Current Liabilities: It is a primary group which has three subgroups:

• Duties & Taxes: The accounts related to duties & taxes you collect or pay through sale and purchase come under it.
• Provisions: All the provisions which are made for the future e.g., Provision for tax, proposed dividend, Bad debts.
• Sundry Creditors: All traders, suppliers which provide goods on credit basis to business.
• Other Current Liabilities: Place all other current liabilities in this group like Outstanding Exp, Provident Fund, Tax Deducted at Source (TDS) etc.

4. Fixed Assets: Immovable properties like patents, Trade Rights, Plant, Goodwill, Building etc.
5. Investment: Investment Ledger account relates to Shares, Bonds, Govt. Securities and investment in other company.

Despite many advantages offered by a computerised accounting system it is not free from limitations. Various limitations of a computerised accounting system are as follows:

1. Staff Opposition: Introduction of computers lead to a lot of retrenchrnent as well as complication of activities which result in resistance of the staff.
2. High Cost of Training: The sophisticated computerised accounting packages generally require specialised staff personnel, which leads to heavy amount of cost of training
3. Adverse effects on health: The excessive use of computers may lead to various health problems like eye strains, back aches, muscular pains etc.
4. Security Problems: Fraud and embezzlements are usually committed on a computerised accounting system through alteration of data. People responsible for tampering of data cannot be located in a computerised set up whereas the same can be easily done in case of manual records.
5. System Problems: System failure due to hardware failures, attack by viruses, system down etc. are the usual problems faced by a computerised system.

Ready-to-use: A variety of readymade softwares is available in the market. These softwares are for users at large and are not developed according to the requirements of any specific user. Most popular readymade softwares available in the market are Tally, Ex. Busy etc.
Customised: The term "Customised Software means making changes in the ready to use software so as to suit the specific requirements of the user. Any readymade software can be changed according to the needs and specifications of the user. However, the cost of installation of customised softwares are high because the cost of change is to be paid by the user.
Tailored: The term “tailor-made software means developing a software according to the needs and specifications of the user. These softwares are not available off-the-shelf.

	Basis of Difference	Ready-to-Use Accounting Software	Tailored Accounting Software
(i)	Nature of Business	This software is used in small and conventional businesses.	This software is used in large and typical businesses.
(ii)	Adaptability	Its adaptability is very high.	Its adaptability is very specific and cannot be used by every business houses.
(iii)	Linkage to other Information System	Its interface with the other information system is limited.	Its interface with the other information system is unlimited.
(iv)	Number of Users	It has limited users.	It has huge number of users.
(v)	Installation and Maintenance Costs	The installation and maintenance cost is low.	The installation and maintenance cost is comparatively higher.