PROJECT REPORT

ON

A STUDY OF COMPUTERSIED ACCOUNTING SYSTEM IN ANY BUSSINESS UNIT

WITH A CASE STUDY OF

MASTER CARE AIR CON SERVICES

SUBMITTED TO

SAVITRIBAI PHULE PUNE UNIVERSITY

IN PARTIAL FULFILLMENT OF THE REQUIREMENT OF MASTER OF COMMERCE

BY

KHAN ATHAR MAZHAR

MCOM-II SEM IV
ROLL NO.3802

UNDER THE GUIDANCE OF

DR.R.R.PANSARE

POST GRADUATE STUDIES CENTER IN COMMERCE

THROUGH
Anjuman Khairul Islam’s
POONA COLLEGE OF ARTS, SCIENCE & COMMERCE
CAMP PUNE-411001
Academic Year 2018-19
 AnjumanKhairul Islam’s

POONA COLLEGE OF ARTS, SCIENCE & COMMERCE

Camp, Pune-411001.

Post-Graduation Studies Centre in Commerce

PROJECT COMPLETION CERTIFICATE

This is to certify that the Project Report entitled “A Study Of Computerized Accounting
System In Any Bussiness Unit” In the Subject Advanced Accounting And Taxation was
prepared by Mr.KHAN ATHAR MAZHAR. Class-M.COM-II SEM IV RollNo.3802 under my
guidance and supervision.

This project report is based on original study/field work carried out by him/her. Such material as
has been obtained from sources has been duly acknowledged in the report.

This project is submitted in partial fulfillment of the subject Research Methodology and Project
Work as per the rules of the University of Pune

PROJECT GUIDE H.O.D

(Department of Commerce)

DR.R.R.PANSARE DR.ABBAS LOKHANDWALA

Exam Seat No.___________ Date of Exam: ______________

External Examiner Internal Examiner

 DECLARATION

I KHAN ATHAR MAZHAR hereby declare that the Project Report entitled “A Study Of
Computerized Accounting System In Any Business Unit” written and submitted by me to AKI’S
Poona College of Science, Arts & Commerce, Pune an affiliated unit of Savitribai Phule, Pune
University, in partial fulfillment of the requirement for the award of degree of Master of
Commerce under the guidance of Dr.R.R.Pansare as my original work and the conclusions
drawn therein are based on the material collected by myself.

DATE: - SIGNITURE

PLACE:-

KHAN ATHAR MAZHAR

ROLL NO:-3802
 ACKNOWLEDGEMENT

I am indebted to all powerful ALMIGHTY GOD ALLAH for all the blessing he showered on
me and for being with me throughout the study.

It is a great pleasure to me in acknowledging my deep sense gratitude to all those who have
helped me in completing this project successfully.

First of all I would like to thank Savitribai Phule, Pune University for providing me an
opportunity to undertake a project as a partly fulfillment of M.Com. I would like to thank Master
Care Air Con Services Pune providing me necessary information in developing my project.

I would like to thank our H.O.D DR.ABBAS LOKHANDWALA Sir and my project guide
DR.R.R.PANSARE Sir whose valuable guidance and encouragement at every phase of the
project has helped the researcher to prepare this project successfully.

Finally, I would like to express my sincere thanks to my family, all the faculties, office staff, and
library staff and friends who helped in some or other way in making this project.

KHAN ATHAR MAZHAR

M.COM-II SEM IV

ROLL NO:-3802
 INDEX

CHAPTER CONTENT
NO.
1. INTRODUCTION

2. LITERATURE REVIEW

3. PROFILE OF THE COMPANY

4. RESEARCH METHODOLOGY

5. DATA COLLECTION AND DATA ANALYSIS

6. FINDING AND CONCLUSION

7. SUGGESTION AND RECOMEDATION

8. BIBILIOGRAPHY

9. APPENDIX
 CHAPTER 1

INTRODUCTION

A computerized accounting system is an accounting information system that processes the

financial transaction and events as per Generally Accepted Accounting Principles (GAAP) to
produce reports as per user requirements. Every accounting system, manual or computerized, has
two aspects. First, it has to work under a set of well-defined concepts called accounting
principles. Another, that there is a user-defined framework for maintenance of records and
generation of repots.

In a computerized accounting system, the framework of storage and processing of data is called
operating environment that consists of hardware as well as software in which the accounting
system, works. The type of the accounting system used determines the operating environment.
Both hardware and software are interdependent. The type of software determines the structure of
the hardware. The type of software determines the structure of the hardware. Further, the
selection of hardware is dependent upon various factors such as the number of users, level of
secrecy and the nature of various activities of functional departments in an organization.

Take the case of a club, for example, where the number o f transactions and their variety is
relatively small, a personal computer with standardized software may be sufficient. However, for
a large business organization with a number of geographically scattered factories and offices,
more powerful computer systems supported by sophisticated networks are required to handle the
voluminous data and the complex reporting requirements. In order to handle such requirements,
multi-user operating systems such as UNIX, Linux, etc. are used.

Modern computerized accounting systems are based on the concept of database. A database is
implemented using a database management system, which is define by a set of computer
programmes (or software) that manage and organize data effectively and provide access to the
stored data by the application programmes. The accounting database is well-organized with
active interface that uses accounting application programs and reporting system.
Every computerized accounting system has two basic requirement:-

1.) Accounting Framework:-It consist a set of principles, coding and grouping structure of
accounting.
2.) Operating Procedure:-It is a well-defined operating procedure blended suitably with the
operating environment of the organization.

Need and Importance and Significance of Computerized Accounting System

1.) It processes data quickly and saves a lot of business time

2.) Performing large number of business transaction is possible with computerized
accounting
3.) This system of accounting reduces the manpower effort
4.) Computer accounting reduces the amount of paperwork
5.) It also ensures the security of accounting information from thefts and frauds
6.) Computer accounting can develop instant financial reports because of its accuracy and
speed
7.) Accounting information can be stored online (cloud facility) for longer durations. This
free up system space, speeds up the RAM and increases performance

Benefits or Merits or Advantage of Computerized Accounting System

1.) Computerized accounting improves financial performance and efficiency

2.) It ensures standardization of process and end results
3.) Computer-based accounting reduces the frequency of routine errors
4.) It reduces the investment in training costs
5.) Moreover, this type of accounting portrays that the company is updated and adoptable
 6.) An overall increase in the level of accuracy, effectiveness and efficiency of the financial
statement are accounting reports
7.) Another key benefit is that this type of accounting reduces operation cost due to errors
and repetitive working
8.) Financial workflow of the organization will not be hindered by the absence of
accountants
9.) Unique accounting techniques and procedures which are relevant to the particular
organization can be created

Requisites or Pre-requisites of Computerized Accounting System

1.) A computer system with (or without) satisfactory internet connection

2.) A well-organized accounting database
3.) Well-trained, efficient and competent accounts who have adequate computer knowledge
4.) A well-established and organized accounting framework and operational strategy
5.) An effective backup arrangement of all accounting database is necessary in order to avoid
technical crash and loss of data
6.) An effective accounting policy which determines the financial functions and ethics of the
organization
7.) An appropriate accounting software that is compatible with the computer specification as
well as the organization’s needs.
8.) In case of technical glitches, an alternative accounting software is of paramount
importance
Complexities or Demerits or Disadvantage of Computerized Accounting System

1.) This system explicitly steals human jobs as manpower, in particular, is replaced by
computers
2.) The added expense to install a computer/computers is an additional key point
3.) Furthermore, there is a requirement for special skills among employees performing
accounting tasks
4.) This accounting system will eventually depend entirely on the system. As a result of this,
there will arise the added risk of system failure and hindrance of business operations
5.) Editing of data that has been misplaced under the wrong category can be very challenging
6.) Spotting of errors that occur in the middle of the accounting process will be difficult to
identify and locate
7.) Since organization have a lot of workloads, they may not have the resources (time or
human) to create backups. Hence, loss of valuable accounting data/information is a high
possibility

Features or Characteristics of Computerized Accounting System

1.) It is aided by the technology of a computer

2.) Accounting with the help of computers yield accurate and efficient results after data
interpretation
3.) It is capable of storing very large quantities of accounting data. Data of the past 10 years
can be stored in the accounting base
4.) Computer accounting systems make precise accounting reports that are of good quality
5.) It is capable of interpreting very large quantities of accounting data
6.) Converting journal entries into ledger accounts can be done with ease and precision
7.) Accounting with the help of computers reduce the process time drastically
8.) Adopting computer-based accounting will ensure that you stay updated with the needs
and changes in the company
 9.) This type of accounting demands accountants to have a strong subject foundation. They
should also have adequate knowledge of working with computers

Online Accounting Information Systems

The use of intranets, extranets, and the internet and other technologies have revolutionized the
way, in which the accounting information systems monitor and track the activities of a business
organization. All these networks are interactive in nature, they demand new forms of transaction
files, controls and procedures.

Inventory Computerized Accounting System

Inventory is the main input of the production system. It includes raw materials, goods in progress
and finished goods. The knowledge of inventory data is critical, as it may shutdown leading to
losses, if inventory is running out of stock.

Inventory control is the technique of maintaining stock keeping items at the desired level.
Inventory information system is an essential part of an organization. Marketing production,
finance and purchase directly influence the level of inventory system.

Input

Inventory data is the level of inventory at a particular point of time. Production data is the data
related to production process. It gives the number of incomplete and complete finished good. By
using terminals on the shop floor, data on production process can be quikly gathered and
processed. Vendor data shows the source of raw material i.e. from, where raw material can be
procured. External data offers the knowledge of raw material, prices and labour activity.
Output

Product design activities are getting more automated through computer softwares like Computer
Aided Design and Computer Aided Engineering. Production is the process of making new
products from raw materials as per the design specification. Material Requirement Planning
(MRP) permits companies to effectively use computers to establish a detailed inventory control.

Importance of Computerized Inventory System

1.) Provides and maintain good customer service.

2.) Enables smooth flow of goods
3.) Provides protection against the uncertainties of demand and supply
4.) Maintain minimum stock to obtain high profile margin

Computerized Transaction Processing System

Transaction processing system collect and process the data relating to transactions. The
transaction processing system concerns with capturing or collecting, recording, coding and
editing activities of transaction data.

In the data entry, data is captured or collected by recording, coding and editing activities and
then converted into a form, which can be led directly into a computer system.

Data entry can be done in three ways viz. manual data entry, semi-automated data entry,
fully-automated data entry.
Computerized Accounting System in Income Tax

 Computer helps in computation of taxable income from salary, house property, capital
gain etc. admissible tax deduction and rebates, depreciation rates.
 Preparation of returns of income. A free preparation software called sampark is available
on department’s website since, 2003. This enables an online preparation of return of
income for non-business taxpayers through a question answer session.
 Taxpayers can file returns through e-return intermediaries or directly through internet. A
utility has been provided to convert data of return of income to specified XML format
will simplify the process of digitizing the paper return information for taxpayers and e-
return intermediaries.
 Computerized processing of returns has created database needed for selection of cases for
scrutiny, identification of stop filers and supporting data for decision-making on tax
policy issues.
 A system of Computerized Assisted Selection of Cases for Scrutiny (CASS) has been
develop to introduce transparency, to eliminate discreation in selection of cases for
scrutiny.
 Free TDS returns preparation software has been provided for generating E-TDS returns
Information Technology and Income Tax in Computerized Accounting System

Directorate of income tax (system) was created in 1981 to coordinate, at the apex level, all
activities relating to introduction of Computerization in the Income Tax Department and to
perform the following functions:-

Software Development

1.) Conduct of feasibility and systems study, to identify areas suitable for computerization
2.) Development, testing and documentation of application software packages
3.) Implementation of software packages at various computer centers of the department
including on the job training and monitoring the progress of implementation

Hardware Installations

1.) Conducting of bench mark tests for selection of appropriate computer hardware for
various users of the department and finalization of terms and conditions of purchase with
the approval of appropriate authorities
2.) Selection of sites for installation of computer hardware, preparation of sites with the help
of appropriate government agency, installation of computer systems, conducting
acceptance tests and making the system operational
3.) Maintenance of computer hardware through appropriate agencies and finalization of
terms and conditions of the annual maintenance contract, which may be taken up
centrally and/or in decentralized manner through CCIT of the region concerned
4.) Monitoring or the performance of installed computer hardware and periodic evaluation of
the needs of additional hardware
Training and Coordination

1.) Identification of training requirements of the department in the field of computers

2.) Conduct of various courses at different computer centers of the departments to build-up
in house expertise in the field of computers at various operational levels
3.) Coordination of all activities relating to the smooth functioning of all computer centers of
the department
4.) Evaluation of the requirements of technical manpower to fill the vacant position in
computer centers of the department and preparation of suitable recruitment rules for the
appointment of this manpower from within and outside the department

National Computer Center

1.) Planning and coordination of all activities relating to setting up and functioning of the
National Computer Center
2.) Maintenance of the national database pertaining to departmental application softwares
3.) Ensuring security of the national database

E-Governance /E-Delivery

The income Tax Department under National E-Governance Action Plan introduced E-Delivery, a
service for taxpayers. This services of E-Delivery is provided through website as a single
window 24 hours a day, 7 days a week, so that a taxpayer can fulfill his routine tax obligations
without visiting income tax offices
Taxpayer Services Identified for E-Delivery

1.) Dissemination of tax related information

2.) Dissemination of taxpayer specific information
3.) PAN and TAN related services
4.) Preparation of returns of income
5.) E-Filling of returns of income
6.) E-Payment of taxes
7.) Computerized processing of returns/refunds

Computer Application in Computerized Accounting System

Computers have their application or utility everywhere. We find their application in all
computations are required to be done at a very fast speed and where data is so computer. Some
of the prominent areas of computer application are:-

1.) Tourism
2.) Banks
3.) Industry

Scientific and Engineering Applications

 Surveying
 Navigation
 Weather forecasting
 Computer-aided Design and Manufacturing (CAD, CAM)
 Process control (e.g. in the chemical industry)
 Engineering drafting
  Software engineering
 Earthquake predictions
 Communications
 Defence
 Space science

Business, Commercial and Administrative Applications

 Preparation of payroll
 Invoicing
 Financial accounting
 Word processing and document preparation
 Annual reports and balance sheet preparations
 Commercial graphics displays, presentation animations
 Large-scale spread sheet calculation

Uses of Computerized Accounting System for Auditing Purpose

Computer is used in auditing procedure. They work to the advantage of auditing in the following
ways:-

More-Reliable

A computer works as programmed. If the programming has taken into account all possible
circumstances, the computer will work more reliable and consistently than the manual system. In
manual system, the auditor may undertake detailed checking of a number of transactions, yet
certain errors and frauds may remain undiscovered. It is not so in the Computerized Accounting
System environment. The auditor has only to see whether there is effective international control
on programme and, if so, checking of certain significant or unusual transactions will be ensure
accuracy in accounting.

In Built Control Procedure

With built-in automaticprocedures, the EDP systems will themselves indicate certain unusual or
significant transactions such as, overdue payments, falling of inventory levels below the
prescribed levels, etc. prescription of password control in computer will secure the data against
access by unauthorized persons. In manual system, there is always possibility of unauthorized
access to accounts.

Automatic Updating

Computers facilitate automatic updating of all relevant computer files by a single transaction. For
example, purchase of raw material from a single supplier will update the accounts of the
supplier, purchases and inventory. In manual system, different individuals will need to update the
relevant files under their charge. Likewise, with proper programming, certain tasks can be
performed without human intervention. For example generation of monthly accounts in case of
customers will remove the need for manual preparation of accounts in individual cases.

Computerized Assisted Audit Techniques/Tools

Computerized-assisted audit techniques or tools are nothing but computer programmes and data.
They may consist of test packs or test data, and computerized audit programmes. The auditor
uses them as part of the audit procedures to process data of audit significance contained in an
entity’s information systems. They enable the auditor to use the computer as an audit tool for
enhancing the effectiveness and efficiency of audit procedures. Before using these programmes
for audit purpose auditor should substantiate their appropriateness and validity. Some commonly
used computer-assisted audit techniques/tools are given below.

Test Packs/Test Data

Test packs or test data represent a set of test data prepared by the auditor himself, or by using any
such data prepared by the internal auditor of the client. They comprise transactions of all kind,
prepared specially to test a programme or a set of programme of the client. To evaluate the
effectiveness of the client’s programmes, the auditor may run his test data on the client’s
computer using the programme of the client himself.

Use of test packs serves as an assurance about the correct functioning of tested programme.
However, its limitation is that preparation of the test data requires care and expertise on the part
of the auditor. For example, it will involve selection of the type of master files or record, e.g.
processing of a test transaction showing receipt of payment from a debtor will reflect in the
master file that contains records of sundry debtors. Moreover the test data should cover all types
and variations to ascertain that the client’s programme includes all necessary controls.

For control purposes, the auditor should maintain proper working papers regarding the use of test
packs. Working papers should show the programme put to test and the results-both expected and
actual. He should also ensure that the programme unaffected by the tests used by him.

Computerized Audit Programmers

Computers are used in auditing to provide auditing information required by the auditor for
making judgement and drawing conclusions. The use of computers in planning, conducting and
concluding audit will be of great help to the auditor. Use of computer in audit saves time. It
reduces monotony of work and enhances reliability and lowers audit cost in appropriate cases.
However, to use computers in auditing requires expert knowledge of the system. It is also
necessary to note that the computerized auditing assistance is only to provide help to the auditor
and not to substitute his professional judgement.

Areas of Use of Computerized Accounting System in Auditing

The following are certain areas where the use of computerized accounting system in auditing
may be relevant:-

 Preparing detailed audit programming

 Preparing audit planning, scheduling and assignment of available manpower to different
assignments in hand
 Retrieving requires key information from the files for making comparison with the set of
standard information
 Doing arithmetical computations and checking the arithmetical computations
 Doing analytical review of the data by way of comparison, ratio analysis, trend analysis,
test of reasonableness and so on
 Checking of validity, consistency and reasonableness of entries
 Reviewing the internal control of the system
 Selecting representatives for vouching, verification-debtors accounts may be planned to
be listed if they comply with certain predetermined criteria
 Flow-charting
 Preparation of audit reports, documenting working papers and writing other
communication etc.
The use of these techniques tools is of great help to the auditor. However, the adoption of such
tools/techniques should be appropriate to handle the audit. The auditor should weigh the audit
demands before he decides on the contents of computer assisted audit tools he would make use
of, its use requires computer knowledge and experience. The auditor should be familiar with the
system in vogue in the client’s place. Appropriateness and relevance must be established with the
client’s system and the auditor’s test pack. He should also ascertain whether his test pack can be
accommodated in the facility offered by his client and whether required co-operation would be
forthcoming without any inconvenience to the client in regard to offering of expert personnel for
assistance and making available the system for checking.

1. Review of Internal Control in Computerized Accounting System

The auditor has to decide whether he can place reliance on the internal control. If internal control
is adequate, he can restrict nature, timing and extent of his checking accordingly. For this
purpose he has to review the internal control system of an organization. The need for such
review is explained below:-

2. To Check Reliability

The auditor has to review the system of internal control to check reliability of the system and
data generated in accounting system. He has to ensure that the internal control system is reliable
enough to ensure that transactions are executed in accordance with management’s general or
specific authorization.

3. To Check Operations

The auditor seeks to find out whether there exists good internal control system and whether such
a system has operated with continuity throughout the period covered under audit. He evaluates
the actual operation of the system against certain criteria that must exist.
 4. To Find Adequacy of System

The internal control system is reviewed to see whether the design of the system is adequate or
not. Here, the auditor is concerned whether the system actually works out without break. He tests
the completeness, accuracy and validity of data generated in the computerized accounting system
of the entity by adopting substantive procedure.

5. To Ensure Prompt Record

There is need to review internal control system to know that it ensures that all transactions are
promptly recorded in the correct amount in the appropriate accounts and in the computerized
accounting system period in which they are execute.

6. To Ensure Safety of Assets

It is reviewed to ensure that assets are safeguarded from unauthorized access use or disposition.

The auditor has to check all this to find out the reliability of the system. If it is not so, he is left
with no alternative but to resort to detailed checking. In case the internal control system is found
to be strong, only a limited number of audit tests will be necessary to confirm the initial
evaluation and then the auditor can safely reply on it for the purpose of expressing his opinion on
the authenticity of the financial statements of the enterprise.

Computerized Accounting System Audit Environment

The features of computers accounting system audit environment explained below:-

1.) Computerized Accounting System Infrastructure

Computerized Accounting System infrastructure includes hardware like CPU, Monitor,
Printer and Keyboard. It also includes operating systems. These may be Windows,
Microsoft (MS) Office, Disc Operating System (DOS), LINUX etc. they oversee the
communication of data between the computer processor and its magnetic discs, as well as
the management of files and programmes on the discs. Application software is a set of all
 computer programmes such as Tally, which is a specially developed Accounting
Software, including operating system, compliers, packages and user programmes which
enables a particular computer center to operate.

2.) Lack of Documents and Transaction Trials

In annual accounting, there is a transaction trail. First, a document originates a
transaction. Then, there is entry of the transaction in the original books of account.
Thereafter, there is posting of the transaction in the principle books. Lastly, the net
effected of transaction reflects in financial statements.
In computer accounting system, on the other hand, there are often no transaction creating
documents and no visible transaction trail. For example, if there is direct feeding of data
into the computer, they may not be any physical input documents e.g. voucher, invoice,
receipt, etc. and no transaction trail. Therefore, to assess how Computerized Accounting
System may influence the audit examination process, he should consider the availability
of data:-
a.) entered in computer
b.) Retained in data files
c.) Generated for outputs

The data may be available only in machine-readable form and accessible only for a brief
period. In such a case, the auditor needs to request the client to retain particular data for
examination. This is because invisibility of information is likely to increase the
possibility of hidden errors as compared to manual system where such errors are visible

3.) Uniform Processing

Under computer processing, there is uniform processing of similar transactions with same
processing instructions or programme. This decreases the risks of human errors like
calculation mistakes but programming error may result in incorrect processing of all
transactions
4.) Concentration of Processing of Information
In Computerized Accounting System environment, only a small number of persons
process the entire information. As against this, in the manual system, there is division of
the work among several persons. As a result, customary controls based on segregation of
diverse functions may be absent or ineffective. Further, persons operating the
Computerized Accounting System achieve expertise as regards the source of data,
manner of processing and generation and distribution of output.

5.) Automatic Execution of Transactions

Under Computerized Accounting System, there is automatic execution of certain
transactions. As a result, there may not be generation may any documents for such
transaction.

6.) Analytical Tools

Computerized Accounting System generates a variety of analytical tools. These may be
useful in reviewing and supervising the operations of the client. These will also go to
improve the internal control structure.

7.) Effective Supervision

Computerized Accounting System enables management to enforce effective supervision
over operations. Analytical tools of Computerized Accounting System only go to make
this easier. The auditor can apply computerized auditing tools to ensure audit efficiency.
EDP system contain built-in software and hardware controls that are more effective than
manual controls.
Generation of Computerized Accounting System
The history of the computer development can be understood in terms of 5 generations of
computerized accounting system. These generations are marked by various technological
development that have transformed the way, in which computerized accounting system
operate. Over the years, computerized accounting system have become smaller, cheaper,
more powerful, efficient and reliable.

First Generation Computerized Accounting System (1940-56)

The first generation computerized accounting system used vacuum tubes, which were
fragile glass device that had the ability to control and amplify the electronic signals. It
required lot of electric power and generated huge amount of heat. The input was
produced on print-outs. Programming was performed in machine language and were able
to solve only one problem at a time.

Second Generation Computerized Accounting System (1956-63)

In the second generation of computerized accounting system vacuum tubes were replaced
by transistors, which were smaller and more reliable than the vacuum tubes or circuits
with transistors were smaller in size, generated little heat, more reliable, less expensive.
These computerized accounting system support high level language like Tally ERP. The
main drawback of these computerized accounting system was that they required frequent
maintenance and individual components had to be assembled manually.

Third Generation Computerized Accounting System (1964-71)

The third generation computerized accounting system used integrated circuits. Keyboard
and monitors replaced punched cards and print-outs. These computerized accounting
system allowed the users to perform many application at one time. They were smaller,
faster and cheaper than the previous generation of computerized accounting system.
Integrated circuit technology made the use of small computerized accounting system.
Fourth Generation Computerized Accounting System (1971-Present)
The fourth generation computerized accounting system saw technology advancements in
the manufacture of integrated circuits. In this, very large scale integration with circuit
densities of millions of transistors. Per chip was introduced computerized accounting
system of this generation were smaller, more powerful and have the ability to form
networks. These feature led to the development of the internet and the World Wide Web.

Fifth Generation Computerized Accounting System (Present and Beyond)

The fifth generation computerized accounting system are based on artificial intelligence
and possess voice recognition capabilities. These computers are parallel processing of
semi-conducts for dvanced computerized accounting system. Thus, the design approach
of the central processing unit of these computerized accounting system are conceptually
different from that of the earlier generations.

Elements under Data Processing under Computerized Accounting System

Computerized accounting system is the execution of a systematic sequence of operations
performed upon data to transform it into information
Following are the elements of data processing under computerized accounting system
1.) Data entry
It is entering the data in a computer program. Here data is captured or collected by
recording, coding and editing activities
2.) Data Coding
The data is then converted into a form, which can be fed directly into a computerized
accounting system. In other words, data coding is inputting the data into the corrupt in
a format that it can understand
 3.) Data Clearing
Third element in data processing under computerized accounting system is data
cleaning. Here, corrected data is identified and corrected
4.) Information Display
Generation of information products like reports and other documents forms the
element of data processing under computerized accounting system

Tally Solutions

Tally Solution Pvt. Ltd. Is an Indian multinational company that provides enterprise resource
planning software. It is headquartered in Bangalore, Karnataka India. The company reports that
its software is used by more than 1 Million customers.

Industry Private
Industry ERP Software
Founded 1986
Founder Shyam Sunder Goenka
Bharat goenka
Headquarters Bangalore, Karnataka India
Products Tally ERP.9
Tally Server9
Tally Developer 9
Shoper 9
Website www.tallysolutions.com

History

Tally solutions, then known as Peutronics was co-founded in 1986 by Shyam Sunder Goenka
and his son Bharat Goenka. Shyam Sunder Goenka was running a company that supplied raw
materials and machine parts to plants and textile mills in southern and eastern India. Unable to
find software that could manage his books of accounts, he asked his son, Bharat Goenka, 23, a
maths graduate. To create a software application that would handle financial accounts for his
business.
The first version of the accounting software was launched as an MS-DOS application. It had only
basic accounting functions, and was named Peutronics Financial Accountant

 In 1988, the product was renamed as Tally

 In 1997, the first windows based version Tally 5.4 released
 In 1999, the company formally changed its name to Tally Solutions
 In 2001, Tally 6.3 launched (Educational/ Licence version)
 In 2005, Tally 7.2 was launched with features designed to meet Indian value added
taxation (VAT) requirement
 In 2006, Tally launched Tally 8.1, a concurrent multi-lingual version, and also Tally 9
 In 2009, the company released Tally. ERP 9, a business management solution
 In 2015, the company launched a program called Vriddhi to certify and classify its
business partners.
 Also in 2015, Tally solutions announced the launch of Tally.ERP 9 release 5.0 with
taxation and compliance features
 As of 2016, the company had 1 million customers
 In 2016, Tally solutions was shortlisted as a GST Suvidha Provider to provide interface
between the new good and service tax (GST) server and taxpayer.
 In 2017, the company launched its update GST compliance software.

Tally main product is its enterprise resource planning software called Tally ERP.9 with single
and multi-user liecences. For large organizations with branches, Tally. Server 9 is offered. The
software handles accounting, inventory management, tax management, payroll etc.

Simple Accounting Management

1.) GST Invoicing

Earlier define GST rates for your items, define HSN Code and generate GST compliant bills.
Tally ERP.9 gives complete support for all types of GST invoices and transactions, for all types
of businesses. Tally ERP.9 helps in generating e-way bills without you having to re-enter details
in the e-way bill portal.

2.) Purchase and Sales Management

Be it purchase or sales orders, debit or credit notes, keep your books up-to-date with Tally ERP.9
which tracks and manages the purchase and sales cycles completely.
 3.) Multi-Currency Support

Have business operations, or customers and suppliers outside India?

Tally ERP.9 lets you define the rate of currency, and standard selling and buying rates before
calculating Forex. You can adjust gains or losses in Forex that occur due to daily variations in
currency rates by simply recording a journal entry.

How Tally handles it?

1. Using Tally ERP.9 the distributor can categories her sales into retail and distribution
sales. By the click of a button, she/he can filter the sales transactions done for retail
customers are know the sales and profit achieved through retail sales.
2. Use the handle configurations for voucher numbering and specify the year either as a
suffix or pre-fix to your voucher number format. Tally ERP.9 accordingly positions the
voucher number. Additionally, specify the width of the numeric part and pre-fill the
invoice with zeros if your format requires.
3. Although the sales bill is recorded, once the purchases of these items is recorded, the
inventory books are updated, and negative stock is adjusted instantly.
4. The firm raises a delivery note every time a batch of water bottles are delivery. Towards
the end of the month, one consolidated sales invoice is recorded, tracking all the delivery
note vouchers and the payment is made.
5. Using Tally ERP.9 you can pre-close an order by the click of a button. You can record
the reason for pre-closure for later reference. The details of all such pre-closed orders are
available in a report.
6. When recording transactions, velocity electronics can record an account invoice when a
service bill for maintenance is recorded. The business can choose an item to record the
sales. The invoice will present the item name, quantity, rate and amount. When entering
data, moving from one invoice to another is simple and can be done by the click of a
toggle button.
7. Additionally, velocity electronics also has the flexibility to record sales and service, both
in a single invoice. Various invoice formats can also be maintained.
8. In the sales order, the delivery is split for two dates. One with the immediate delivery of
900 chairs and the remaining 100 chairs are marked as due after one week. The stock is
dispatched with a delivery note. The sales order outstanding report shows the balance
quantity the needs to be delivered. If the order hasn’t been completed within a week, the
balance quantity will reflect as orders overdue. When the delivery note or sales for the
balance 100 chairs is recorded, the reports get updated instantly. However, due to some
 reasons, if the customer cancels the order, pre-closing is just a button away. The store can
record the partial quantity that wasn’t delivered with the reason for pre-closure.
9. The spare parts trader creates price level in Tally ERP.9 for each type of customer. He
then creates custom price list for the customer types. He selects the items and defines the
quantity range for which a price can be applicable. He also defines the additional
discount percentage, and date of applicability for the prices.
10. During invoice, the trader selects the required price level, and the stock items.
Automatically, the price of the stock item is displayed. Depending on the invoice date
and quantity sold, the price varies. This allows having floating rates for stock items.
11. However, the trader has the flexibility to overwrite the price defined for an item.
12. While they decide over the outstanding bill, the amount received has to be accounted for,
and there is no particular bill towards which this amount can be adjusted. Selecting the
type of reference as on account will account for this amount without tagging it to a
specific bill. However, after sorting the difference the trader can alter the type of
reference to tag it against the appropriate bill.
13. To meet the requirement of using multiple addresses for the same party, Tally ERP. 9
give the flexibility to create multiple address types for a party in the ledger master. For
example, Head Office and Branch Office can be created as address types. The contract
person’s name can be different for each person, and other details like fax number, and e-
mail ID specific to a particular address can be maintained. Statutory details like GSTIN,
Excise Registration No. and more can be specified.
14. When recording a sales invoice, just by selecting the respective consignee address, and
supplier address, all relevant details are displayed and can be printed in invoices too.

Tally ERP.9 is a business management program that allows business managers to handle all of
their business transactions from a centralized application and from any location.

The program allows users to handle accounting, finance, point of sales, payroll and branch
management.

The Tally ERP.9 software is designed for the sole purpose of helping business succeed in an
integrated and controlled environment. It is a business system that does not discriminate based
on the location of the users and can be used with a variety of platforms. It comes with tutorials
and demonstrations that allow to better understand the way the application works.

The application provides ease of access in all aspects, including the way that it is installed onto a
platform. There are various methods for installation, but it can be easily completed by even new
users.
The installation has walk through demonstrations that allows users to control every aspects of the
installation. It is also equipped with features like the ability to install only what is needed in the
particular business setting.

Users can choose which features they want to use and install them. All of the features that are
available with the system do not have used by all business managers.

What is the difference between Accounting and Bookkeeping

1. Bookkeeping involves recording basic accounting transactions such as regarding invoices

from suppliers, paying suppliers, processing payrolls and recording cash received from
customers.
2. Bookkeeping is a subset of accounting. Accounting is usually more involved and includes
activities such as creating financial statements, creating budgets and compiling tax
returns.
3. A Bookkeeper may have a lot of experience but may lack formal accounting training.
4. Accountants typically work in a specific function, while bookkeeping is more broad-
based.
5. Accountants for mid-sized to large business set up procedures that are then followed by
bookkeepers.
6. Bookkeepers do mechanical procedures, but accountants design them.
7. A small business might only need a Bookkeeper for its accounting, but larger businesses
typically have at least one accountant.

Manual Accounting System

1. A manual accounting system is a way of keeping business financial records with a written
ledger of transaction. Computers and software are not used as part of a manual system.
2. While modern business use computerized accounting system/ packages, some firms still
prefer a manual system.
3. A manual system costs less because there is no expenses for computer equipments,
software and employee training.
4. A manual system can be more secure because it does not use the internet to transfer to
accountants or the IRS.
5. A disadvantage of a manual accounting system is that it is prone to mistakes, with no
software in use to confirm calculations.
 6. Generating financial reports takes more time and efforts, and paper records with no
backup are more prone to destruction by fire or floods.
7. Preparing tax returns takes longer when using a manual system.
8. In the event of an audit, a manual system requires more man hours spent on gathering
requested documentation.
9. Manual system work best for smaller business and don’t work well in companies with
large numbers of financial transactions.
10. Using paper requires that the bookkeeper be more knowledgeable in basic accounting
principles than in necessary for an employee using accounting software.
11. This makes it more challenging to find suitable employees to keep books, as fewer
companies use manual accounting and more use computerized accounting system.

A few key features of Tally ERP.9 are listed below

1. Codeless Accounting System

Normally for other accounting software’s, a certain code is used for identifying any particular
ledger, for example Ledger Code B2081 indicates “Printing and Stationary”.

2. Unlimited Accounting Period

It means you can maintain the records for more than one financial accounting period, for
example, you can maintain the record for the financial year (F.Y.) 2017-18 and 2018-19 for the
same company.

3. Simultaneous Operation of Multiple Companies

It means you can update the data record for more than one company simultaneously, for example
at the same you can update the data for all of your companies in the same group.

4. Accounting for the Complete Group of Companies

You can prepare a consolidated balance sheet for all the members of your group companies.

5. Top Level Security for each Company

You can create different levels of users and restrict their a activities by assigning them rights, for
example you can create a user for data entry, who cannot view the report.
 CHAPTER 2

LITERATURE REVIEW

Comparison between Manual And Computerized Accounting

Accounting, by definition, is the process of identifying, recording, classifying and summarizing

financial transactions to produce the financial reports for their ultimate analysis. Let us
understand these activities in the context of manual and computerized accounting system.

1.) Identifying:- The identifying of transactions, based on application of accounting

principles, common to both manual and computerized accounting system.
2.) Recording:-The recording of financial transactions, in manual accounting system is
through books of original entries while the data content of such transaction is stored in a
well-designed accounting database in computerized accounting system.
3.) Classification:-In a manual accounting system, transaction recorded in the books of
original entry are further classified by posting into ledger accounts. This results in
transaction data duplicity. In computerized accounting, no such data duplication is made
to cause classification of transactions. In order to produce ledger accounts, the stored
transaction data is processed to appear as classified so that the same is presented in the
form of a report. Different forms of the same transaction data are made available for
being presented in various reports.
4.) Summarizing:-The transaction are summarized to produce trial balance in manual
accounting system by ascertaining the balance of various accounts. As a result,
preparation of ledger accounts becomes a pre-requisite for preparing the trail balance.
However, in computerized accounting, the originally stored transactions data are
processed to churn out the list of balances of various accounts to be finally shown in the
trial balance report. The generation of ledger accounts is not necessary condition for
producing trial balance in a computerized accounting system.
5.) Adjusting Entries:-In a manual accounting system, these entries are made to adhere to the
principle of cost matching revenue. These entries are recorded to match the expenses of
the accounting period with the revenues generated by them. Some other adjusting entries
 may be made as part of errors and rectification. However, in computerized accounting,
journal vouchers are prepared and stored to follow the principle of cost matching
revenue, but there is nothing like passing adjusting entries for errors and rectification,
except for rectifying an error of principle by having recorded a wrong voucher such as
using payment voucher for a receipt transaction.
6.) Financial Statements:-In a manual system of accounting, the preparation of financial
statement pre-supposes the availability of trial balance. However, in computerized
accounting, there is no such requirement. The generation of financial statement is
independent of producing the trial balance because such statement can be prepared by
direct processing of originally stored transaction data.
7.) Closing The Books:-After the preparation of financial reports, the accountants make
preparation for the next accounting period. This is achieved by posting of closing and
reversing journal entries. In computerized accounting, there is year-end processing to
create and store opening balances of accounts in database.

It may be observed that conceptually, the accounting process is identical regardless of the
technology used.

Accounting Packages

Every computerized accounting system is implemented to perform the accounting activity

(recording and storing of accounting data) and generate reports as per the requirements of the
user. From the perspective.

The accounting packages are classified into the following categories:-

a.) Ready To Use

b.) Customised
c.) Tailored
d.) Tally ERP
Each of these categories offers distinctive, the choice of the accounting software would depend
upon the suitability to the organization especially in terms of accounting needs.

a.) Ready To Use

Ready to use accounting software is suited to organization running small/conventional
business where the frequency or volume of accounting transaction is very low. This is
because the cost of installation is generally low and number of users is limited. Ready to
use software is relatively easier to learn and people (accountant) adaptability is very high.
This also implies that level of secrecy is relatively low and the software is prone to data
frauds. The training needs are simple and sometimes the vendor (supplier of software)
offers the training on the software free. However, these software offer little scope of
linking to their information systems.

b.) Customized
Accounting software may be customized to meet the special requirement of their user.
Standardized accounting software available in the market may not suit or fulfil the user
requirements. For example, standardized accounting software may contain the sales
voucher and inventory status to be updated immediately upon entry of sale voucher and
report be printed, the software needs to be customized.
Customized software is suited for large and medium business and can be linked to the
other information systems. The cost of installation and maintenance is relatively high
because the high cost is to be paid to the vendor for customization. The customization
includes modification and addition to the software contents, provision for the specified
number of users and their authentication etc. secrecy of data and software users is
important, the training costs are therefore high.
c.) Tailored
The accounting software is generally tailored in large business organization with multi
users and geographically scattered locations. These software requires specialized training
to the users. The tailored software is designed to meet the specific requirements of the
users and form an important part of the organizational MIS. The secrecy and authenticity
checks are robust in such software and they often high flexibility in terms of number of
users.

To summarise, the following table represents the comparison between the various
categories of accounting software:-

Basis Ready To use Customized Tailored

Nature of business Small, conventional Large, medium Large, typical
business business business
Cost of installation Low Relatively high High
and maintenance
Expected level of Low Relatively high Relatively high
secrecy (software
and data)
Number of users and Limited As per specifications Unlimited
their interface yes
Linking to other Restricted Yes Yes
information system
Adaptability High Relatively high Specific
Training Low Medium High
requirements
d.) Tally ERP.9
Tally ERP 9 has been developed by Tally ERP 9 solution Pvt. Ltd. a Bangalore-based
company in India. It’s a very user-friendly and popular accounting software that runs on
MS Windows and also computer for Indian VAT, TDS and Service Tax. It can even
maintain your account and inventory simultaneously.
 Data Import and Export Facility:-You can import export any particular
data from one company to another company.
 Audit Facility:-Using this facility you can check the recorded voucher and
make modifications as per requirement
 Budgeting:-Allows you to analyze the variance (difference between actual
and standard) for expenses, income etc.
 Scenario Management:-Can be used for projected profit and loss A/C and
balance sheet
 Bank Reconciliation Statement
 Price List, Ageing Analysis For Stock Item:-Rate of product can be
defined with its quantity
 Cost Center And Cost Category-Wise Account Analysis:-These features
are very useful for unit-wise analysis, for example you may want to
analyze employee-wise cost, branch-wise cost etc.
 Usefulness in Manufacturing Business:-Useful for calculation of goods
sold
 Ratio Analysis, Cash Flow, Funds Flow
 E-capabilities
 Foreign Currency:-Useful for calculation of foreign gain and loss using
foreign currency
 Defining the Bill/Voucher Entry Setup
 Columnar Reporting Related to Stock and Accounts
 Adherence of Purchase and Sales Procedure such as Order, Challan, Bill
 Credit Control:-Credit Control is possible for a customer
 Tracking through Receipt/Delivery Notes
  Profitability Analysis of Stock
 Accounts For:-
1.) Indian VAT
2.) TDS
3.) E-TDS
4.) Service Tax

Due to these unique features and multifarious facilities, Tally ERp.9 is widely used by
different kinds of Business Companies and other Organization for maintaining the
accounts of

1. Company
2. Individual
3. Charitable Trust
4. Trader
5. Manufacturer
6. Enterprise
7. Partnership firm
8. Shop
9. Transport
10. Services Industries
11. Nursing Home
12. Petrol Pump
13. Pharmaceuticals
14. Departmental Stores
15. Whole-Seller
16. Insurance Agents
17. Restaurant
18. School
 19. Institutions
20. Tutorials
21. Advocate
22. Builders
23. Chartered Accountants
24. Chit Funds
25. Doctors

Computerized Accounting over Manual Book-Keeping in Tally ERP 9

Manual Book-Keeping has to bother for all the following steps:-

 Creating ledger and carrying forward their closing balances

 Recording cash transactions in a Cash-Book and Bank Transactions in a Bank Book
 Recording other Noon-Cash transaction in a Journal Book
 After recording you have to calculate the balance of the Ledgers
 Preparing Trial Balance to prepare Final Accounts
 Deriving Nominal Account from the Trial Balance in the Profit and Loss A/c
 Posting Real and Personal Accounts in the Balance Sheet
But when you are using Tally ERP.9 you concentrate only on recording the transaction.
Tally ERP.9 automatically generates all kinds of reports for you.

Basic Accounting Basic Inventory

Complete Book-Keeping Stock Categories
Books, Registers and Statement of Accounts Multiple Godowns
General Ledger Stock Transfer to Godown and Branches
Accounts Receivable and Accounts Payable Batch-Wise, Lot-Wise, including Expiry Date
Flexible Voucher Numbering Alternate Costs incurred on Purchase
Drill Down Display Movement/Profitability Analysis Party-Wise,
Item-Wise, Stock Group-Wise
Data Base Reporting Sales and Purchase Order Processing
Columnar Reports Excise/Vat analysis of Invoices
Bank Reconciliation Stock Ageing Analysis
Multiple Companies Additional Cost of Manufacturing with
Notional Value and Percentage
Multiple Financial Years Batch related Stock Report
Memo Vouchers Bill of Material with Auto-adjustment of
Stocks
Post-Dated Vouchers
User-Defined Voucher Types
Cash Flow Statement
Flexible Classification of Accounts Heads
Tally Versions

Year Version Contents

1999-1989 4.0 Account only
1989-1990 4.5 Account only
1990-1997 5.0 Account with Inventory
1997-2000 5.4 Account with Inventory
2000-2005 6.3 account with Inventory
2005-2006 7.2 Account with Inventory, VAT,
TDS, Service Tax
1st Sept. 2006 8.1 Account with Inventory, VAT,
TDS, Multi Lingual, Composit
VAT Excise
1st Dec. 2006-2009 9 Account with Inventory, VAT,
TDS, Multi Lingual, Composit
VAT, Payroll, Job Casting,
Excise, Co-dealer
12th March 2009 ERP 9 Account with Inventory, VAT,
TDS, Multi Lingual, Composit
VAT, Payroll, Job Casting,
Remote Access, Excise for
Manufacturing
2nd August 2018 ERP 9 6 Series GSTIN Validation

Tally ERP.9 Release 6

GST Masters

In the ledger, an error invalid GSTIN/UIN appeared on entering the GSTIN/UIN for few regular
tax payers, and the transaction appeared as exception in GSTR-1, which could not be resolved.
This issue is resolved, and you can also include the vouchers captured with GSTIN/UIN
exception in the returns.
Computerized Accounting System in an Organization

Any computer can perform four basic operation of input, processing, output and storage

1.) Input Unit

Data and instructions are entered into the computer through the input unit to get
processed into information. Input device like the keyboard, the mouse or the microphone
are used the enter the data. Keyboard is used to input characters, numbers and certain
symbols. Mouse is a device that has on screen pointer that enables the users to select
items and choose option and microphone can be used, if the user wishes to enter
instruction by making a voice entry.

2.) Central Processing Unit

The central processing unit is the main processing component of a computer system. The
central processing unit stores the data and instructions in the primary memory of the
computer, called the Random Access Memory and process them from this location. The
Arithmetic Logical Unit and the control unit are the two sub-components of the central
processing unit. The arithmetic logical unit carriers out the arithmetic and logical
operations while the central unit retrieves the information from the storage unit and
interprets this information

3.) Output Unit

The output unit passes on the final results of computation to the users through the output
devices like monitor, printers etc. a monitor displays the final results of the processed
data on the screen, while a printer can be used for obtaining the output in a printed
format.

4.) Storage Unit

The data and instructions that enter the computer system have to be stored internally
before the actual processing takes place. The storage unit of a computer system is
designed to store the data generated at various stages of processing. Storage media like
hard disks, floppy disks, etc. aid in storing the data in various forms.
 CHAPTER 3

PROFILE OF THE COMPANY

MASTER CARE AIR CON SERVICES

Master Care Air Con Services was established in the year 2000 and has its main branch in Pune.
It is a Air Conditioner Business which was founded by Mr.Mazhar Khan in 2000. Master Care
Air Con Services has an office in Bangalore also. It deals with all types of Air Conditioners for
all corporate companies, banks, institutions, and individuals. It also deals with a dealership of
Panasonic And Voltas. Master Care Air Con Services Uses Computerized Accounting System
such as Tally ERP. They Use Tally ERP for their purchase and sale and for accounting purpose.

Master Care Air Con Services uses the latest version under Tally.ERP 9. Option to avail input
credit under reverse charge in current or future period, the business needs to avail charge
mechanism, you will find it delightfully useful and flexible to take credit on reserve charges in
current or future periods.

Earlier for few taxpayer types, GSTIN validation was failing in tally. ERP.9 Now, with this new
Release, GSTIN will be validation for all taxpayer types.

Master Care Air Con Services uses Tally ERP. 9 was started using from January 2019 for the
help of GST filing in various department of the day to day work in different department wise to
help in the use of sales and purchase of profit and loss account and balance sheet of the account
of Master Care Air Con Services.

Master Care Air Con Services focuses on Air conditioners and manufacture of air conditioner,
safety systems and of stability control system and electronic system such as Tally ERP

Master Care Air Con Services supplies air conditioners for Panasonic, Voltas and Daikin from
the distributor . the company consists of 3 brands, service center and different electronic items in
2 city including Pune and Bangalore.
Their average daily selling of air conditioners are 15 per piece of air conditioners of different
brands such as:-

1. 0.8 Ton Split, Window Air Conditioners

2. 1 Ton Split, Window Air Conditioners
3. 1.5 Ton Split, Window, Cassette Air Conditioners
4. 2 Ton Split, Window, Cassette, Tower Air Conditioners
5. Above 3 Ton VRV, Cassette. Ductable, Tower Air Conditioners

The company has a long list of products that includes:-

PCB Card System

Fan Motors of air conditioners

Fan Blade of air conditioners

Capacitor of air conditioners

Body of air conditioners

Filter of air conditioners

History

Founded in Pune, Maharashtra, in 2000, Master Care Air Con Services can look back on history
of success. We help people around the city turn their ideas of mobility into reality. Our
technologies, systems, and service solutions make mobility and transport more sustainable, safer,
more reliable, more comfortable, more customized and more affordable. As an air conditioner
supplier and dealer partner, we offer solutions that help keep people safer and healthier, that help
protect the environment, and give individuals more opportunities to shape their future. Master
Care Air Con Services ground the globe are currently developing new answers for future
mobility.

In 2000

Master Care Air Con Services is founded on October 8 as a proprietor company. Dealing at the
main office in Pune Bhawani Peth includes:-

1. Voltas Air Conditioners

2. Panasonic Air Conditioners
3. Daikin Air Conditioners

In 2001

Master Care Air Con Services opened a new office at Bangalore

In 2002

Master Care Air Con Services started giving services in chakan industrial areas company such as
AMPCO Company Pvt Ltd.

In 2003

Master Care Air Con Services started giving services in wagholi industrial areas company such
as Minda Company Pvt Ltd.

In 2004

Master Care Air Con Services took the agency of Daikin Air Conditioners

In 2005

Master Care Air Con Services started they business service center in B.T.Kawade road and in
New Nana Peth in Pune

In 2006

Master Care Air Con Services started using Computerized Accounting System such as Tally
ERP.9
In 2007

Master Care Air Con Services totally stop manual accounting and started doing totally
computerized accounting

In 2008

Master Care Air Con Services started doing computerized accounting in Bangalore branch.

In 2009

Master Care Air Con Services started spreading there business in Bangalore and started a service
center in Bangalore

In 2010

Master Care Air Con Services totally stop manual accounting and started doing computerized
accounting system in tally.
Innovation of the Company

In addition to air conditioner technologies such as Voltas, Daikin, Panasonic dealership several
service center are put into exestiance for doing repairing work such as repairing of PCB Card,
and ElectronicCircuit Board are as much a part of the service sector as safety of the air
conditioners and convience for air conditioners

Automated Updating

One of the major trends in computerizes accounting system is automated updating. In the future,
the connectivity of intelligent technologies will ensure that, on an increasing number of Tally
ERP.9 the task will be taken on by the accountant. In keeping the stored data in “Tally ERP.9”,
we are passionately working on making the vision a reality for all computerized accounting
system.

Electric Circuit Board

How we can design electric circuit board to be even more efficient through the increasing
connectivity of electrification and existing power transmission technology as well as the software
and an intelligent mix of circuit board.

Safety

Accidentals should be a thing of the past. Given the steadily increasing volume of service, the
issue of safety in the Master Care Air Con Services business is becoming a key challenge for
society, industry, and corporate clients. Discover how Master Care Air Con Services is
increasing service safety with its business.

Digitalization

Entire business are changing with and through digitization, while Tally ERP.9 are demanding
even more from their accountant. In addition to computerized accounting system in Tally ERP.9
also plays a significant role.

Product of the Company

Air Conditioners

Air Conditioner are the link between a dealer and a consumer. In critical situations, it is the
technology level of the air conditioners that determines whether a air conditioner is able to start
in time or stay in the correct order during cornering maneuvers.

The Service center is known for maximizing safety through making the PCB Card and Electric
Circuit Board as well as reducing manpower through machine work.

The company offer the right air conditioners for every consumer or clients or a company.

The Air conditioner Business is divided into two business units:-

1. One firm has GST and Computerized Accounting System

2. One firm does not have GST its annually turnover is below the GST amount
For the commercial sector, the company offers digital solutions for the comprehensive and
efficient time management of our fleet customers as well as the complete life-cycle, including
computerized accounting system such as Tally ERP.9

Master Care Air Con Services division in Pune is one of the Local leading business specialists.
As a technology partner, our name is synonymous with expertise in development and provides
not only products, system and services but also Tally solutions and is a formative influence on
the business.

We see digitalization and current trends as an opportunity to work our customers to add
sustainable value- for both side and for goods materials for components made of copper and
wiring and also in combination with air conditioners. By integrating electronic components, we
are also generating solutions for the future.

With the rising taxes and growing competition, managing a business is not a child’s play. While
the operating cost of the business are ever increasing, rising competition makes it difficult to
demand a premium for the customers to run the business profitably. In such a scenario, the
solutions may lie inwards in the business operations. By optimizing the operations and in turn
optimizing the costs, the business can hope to reduce their costs to drive their profits.

Master care air con services represent a major cost in local business and the right decision are
needed to keep the business going. Air conditioners can be effect up to 40% of a cost directly
and is the second largest cost to business after fuel. Generally, due to the huge risk and risk
involved, customers are less interest to try new air conditioners.

I visited to Master Care Air Con Services at Bhawani Peth Branch Pune Maharashtra
 CHAPTER 4

RESEARCH METHODOLOGY

“A computerized accounting system is the arrangement of accounting information such as Tally

ERP for collection and analysis of data in manner that aims to combine relevance to the research
purpose with economy in procedure”. This study involves both Primary and the Secondary data
covering a period of 2018 and 2019 till date.

The Primary data was collected by Questionary Form by asking some question to the Accountant
of Master Care Air Con Services.

Questionaries Was As Follows:-

1.) What is the name of the computerized accounting system?

Tally ERP.9

2.) Sir from how long you are working on computerized accounting system?
Since 2010

3.) You are working as?

I am working as an accountant of the company

4.) Sir I what does the company deals in?

The company deals in all types of air conditioner

5.) When was Tally ERP.9 came into existence in the company?
Since 2005

The Secondary data was collected from the firm for profile and accounting related information
relating computerized accounting system and to understand Tally ERP.

The sources of the primary data

1.) The company visit

2.) The question was asked by me to the accountant of the company (Pune)
The source of the secondary data

The research work is based on the secondary data also the secondary data was collected by the
following ways

1.) Books
2.) Journals
3.) Websites

1.) The books on Computerized Accounting System were as follows:-

 Computerized Accounting System-NCERT
 Computerized Accounting System-Textbook
 Computers And Accounting System-Bibliography
 Computerized Accounting System-A Practical Guide
 Computerized Accounting System-Tally ERP.9

2.) The journals of Computerized Accounting System

 The journal issued by the Tally ERP.9
 Journal on computerized Accounting System

3.) The website were used to collect the information on computerized accounting
system for the company information
 www.mastercareairconservices.com
 www.mastercare.in.com
 www.mastercareairservicecenter.in

This are the source form the information is collected for the completion of this project. As
mention above the source of the collecting the information relates to both primary as well as
secondary sources.
Computer Application in Accounting

A computer is an electronic device that receives data or a set of instructions, processes them and
then gives the information. These data and instructions are called, input, whereas information is
termed as output. It is a set of electronic device that can systematically and sequentially follow a
set of instructions called a programme or perform high-speed arithmetic and logical operations
on data.

A computer makes our work easy. It is a machine having memory. It works with instructions.
We can store words and numbers in its memory. It works fast and does not get tired. A computer
never forgets and thousand of facts can be stored in its memory. It never makes careless
mistakes. Because of the rapid changes in finance and its related fields, accurate record keeping
is critical.

Computerizing a business tasks of accounting procedures, increase efficiency. With a computer

and its appropriate software, one can request and receive an in house balance sheet, an income
statement, cash flow and statements of affairs and other accounting reports within a short time
hence, an increase in productivity. The role computers are playing in the field of accounting,
changing some of the things that were manually done and facilitating accounting data processing.

Spread Sheets

Electronic spread sheets allow to do anything that would normally be dome with a calculator,
pencil and columnar scratch pad. A typical integrated double entry accounting spread sheet
system will contain some of the following components general ledger, inventory levels, order
entry, payroll, time and billing etc.

General Ledger

Electronic general ledgers are labour saving device for the preparation of financial statements
and for establishing multiple income and cost entries. It takes charge of secondary postings.
Inventory control

Electronic inventory control module has multiple functions, which includes tracking inventory
for both costing and tax purposes, helping managers in controlling purchasing and minimizing
the investment in inventory. It is integrated with the general ledger, so it can automatically set
aside the correct amount for processing further.

Accounts Receivable

Electronic accounts receivable can get the bills out the same day a service performed. Electronic
accounts receivable module can prepare invoices.

Accounts Payable

Paying bills requires lots of time and energy, especially when using the manual system. Using
software, one can pay a bill and book the expenses associated with the payment at the same time.
It saves time, as payments for bills can be made in batches and prints of all the checks can be
taken at once. No more handwritten checks or manually entered expenses.

Once vendors are entered in the system, writing of their names and addresses over and over gets
removed the software saves this information you only invoice numbers and amounts need to be
entered and the rest pre-populated-a major benefit of computerized system.

Reporting

Easy reporting is a important benefit of a computerized accounting programme. Errors can be

easily identified, corrected and one can re-run reports in minutes-something, which is impossible
to perform using the manual system. Report accuracy is very high as all calculations are done by
a computer increasing reliability of financial information.

Once accounting data is put into the system, it can be complied and manipulated through reports
and queries that are usually easy to use and modify. Accounting systems offer a variety of
reporting options, including the ability to export data to a spread sheet, where you can
manipulate the information.
Payroll

Payroll is often processed with computers and not by hand. Complex calculations, such as
benefits and taxes are performed by a computer, increasing correctness and efficiency. Changes
can be made easily and in timely manner. If an employee want to increase his tax withholding,
this information is entered in the system and the rest is processed by a payroll system.

To minimize errors, time sheets can be uploaded directly into the system without human
intervention, which saves any time of firm with many hourly employees.

Computer Application in Finance

Computers have revolutionized the financial industry and the way finance works by automating
complex calculations and providing instant communication and news. The sophisticated way, we
do business and economics today, would have been impossible only a few decades ago, due
largely to the impact of computer technology on our ability to make financial decisions.

Communication

Communicating remotely and instantly among people and computer networks is one of the
primary uses of computing power. This system allows producers of good to instantly access price
information in faraway places and make decisions about where and when to sell. Financial
traders, such as stock prices and trade volumes around the world and make their own trades
based von that information.

Automation

Computers can perform automatic calculations and even automatically retrieve information
needed to perform those calculations.

E.g. quickbooks or peachtree accounting information and transaction records from a bank and
then perform calculation to show a business owner their current cash, accounts payable, profit
and loss etc.\
Excel templates automatically perform mathematical calculations and create graphs and charts,
allowing financial professionals to understand meaningful data at a glance.

Record-Keeping

Earlier, all financial records were handwritten on paper or even carved on tablets in ancient
times. Having financial records is essential for determining, who is in debt to whom, how mch is
owned in taxes, how much money is on deposit at a bank and so on. Computers can store
millions of documents in a very small space, allowing us to keep more in depth records about
more transactions, without taking up nearly so much physical space.

Spread Sheet Software

Spread sheet software influences the way large and medium sized firms, as well as individuals,
key in and organize financial data. Spread sheet applications are used to run day-to-day financial
tasks, such as compiling financial data, presenting the data in an organized manner through the
use of charts and graphs, drawing budgets and calculations of complex transactions. This
application comes with computer programs, such as Microsoft Excel, that enables organization
and individuals to plan finance without wasting too much time.

Data Storage

Computerization makes data storage manageable and less bulky. Computers enable organization
to store large amounts of files in a small space, while avoiding consumption of space that would
otherwise be consumed by piles of files in cabinets.

Keeping financial records is critical for organization, as well as individual, as it allows tracking
of payments records, debts owned, purchases done and bank transactions made. Having detailed
financial records helps an organization to continually audit and analyse business performance.
Financial Information

Computers have enhanced access to wide financial information through internet access. Business
operators or individuals can now access information on investment prospects and conduct a
detailed research on its profitability.

There is also wide financial information available on the internet, such as world prices, tax
changes, inflation rate and currency exchange rates making it easier for institutions and
individuals to make informed financial decisions. The internet provides a wide source of
information and access to specific financial reports of companies in trade.

Some reference book where refer.

 CHAPTER 5

DATA COLLECTION AND DATA ANALYSIS

The data collection and data analysis, is done by the primary method and secondary method

I collected the information of computerized accounting system which were service center and
dealer of air conditioner in Pune

From the primary information that I collected by the questioner. Are as follows

Name of the company for which the research work is done

It is Master Care Air Con Services

It is a Pune based Company invested the capital in India

The accountant farooq who is appointed as accountant of the company having the working
experience since 5 years in the company

The company is dealer in many of the brands of air conditioners but in the service center the
services goes on

The research work is done on the computerized accounting system of Tally ERP 9 in the
company

To process the data scientifically and to make it easily understandable statistical method of
tabulations used. Compilation of data was done with the aid of computers.MS-Word was used
for data processing and presentation of Computerized Accounting System In A Business Unit Of
Master Care Air Con Services.

Business statistics is a tool which can be used in solving problems that arise in almost all
business field of empirical enquiry. It is the science of good decision-making in the face of
uncertainty and is used in many disciplines like financial analysis, econometrics, auditing,
production and operation including service improvement and marketing research. Data used in
business include population census, opinion polls, consume data bases and demand data. It is a
branch of applied, statistics working mostly on data collected as a by product of doing business
or by government agencies. It provides knowledge and skill to interpret and use statistical in
variety of business application.

Business statistics is very useful in economic planning banking, transport, agricultural and
insurance. Thus, business which includes whole of complex of commerce and industry.
In every statistical investigation, the first thing is the collection of data. These data are so huge
and complex in their nature that they do not give a clear and correct picture of the whole data. In
order to have a clear and intelligible picture of the complex and bulky data, certain devices are
applied. These devices are known as statistical methods. These statistical methods are the
techniques used for collection, summarization, analysis, comparison, classification and
interpretation of the huge and complex numerical data. Statistical tools such as tables, graphs and
diagrams are required for the analysis of data.

After the data have been collected, it is essential to put them in the form of tables with rows and
columns. Tables should be prepared in such a way that they can be put to the best advantage with
minimum efforts. For analyzing the data collected, tools such as tables, graphs and diagrams are
used. These tools are exhaustively used in data records, government reports etc. in such a way
that an ordinary person will be understand and draw a valid conclusion from the tools or
information.

Computerized Accounting systems the oldest and perhaps the most widely used computerized
information system in business. It is responsible for maintaining the accounting system of the
organization. These system record and report financial transaction and other economic
proceedings taking place in an organization.

The main purpose of an computerized accounting system is to accumulate data pertaining to the
financial transactions, process it into information and report it to the external entities in the
organization. The internal entities include the managers, who need such information for planning
and controlling the business operations and for decision-making. The external entities include the
creditors, investors and government agencies that need such information to make various
decisions like investment decisions.

Accounting is the process of identifying, measuring and communicating economic information to

permit informed judgements and decisions by users of the computerized accounting information
system. Basically, computerized accounting system are rooted in the concept of double entry
book keeping.

 In computerized accounting system, source of data is mainly internal to the enterprise and
thus, database are well defined and integrated and controlled.

 Computerized accounting system deals with transactions, which are financial in nature
and can be expressed in terms of money.

 Computerized accounting system caters to the information needs of both external and
internal users. The external users are customers, vendors, shareholders, investors, stock
exchange, etc. the internal users are managers at various levels of the organization.
 Computerized accounting system is simple and well structured information system.

 Computerized accounting system mainly uses the historical data and also includes the
future data in the form of budgets and forecasts.

In the past computerized accounting system were designed primarily for providing reports to
government authorities and investors. Very little information was generated for managerial
decision making. Today, focus more on generation of computerized accounting system for
use in managerial decision-making process.

Components of Computerized Accounting System

• Input • Process

Classificatio
n
Transaction
and other Comprasion
data Aggreation
Calculation

Financial
Statement
Management Users
Report
Documents
• Output • Internal and
External
Control
Input

The input of accounting information system consist of the transaction data. It also includes the
status information regarding different entities such as customers, vendors, employees and assets.

Process

The processing of accounting data is done in four different ways such as classification,
comparison, aggregation and calculation.

Output

Output of the computerized accounting system consists:-

 Financial statement such as income statement, balance sheet and statement of changes in
financial position.

 Management reports such as debtors ageing report, financial ratios, expenses analysis
support, etc.

 Other output documents like customers invoice, materials purchase order, pay cheques,
etc.
 CHAPTER 6

FINDING AND CONCLUSION

CONCLUSION

The growth and development of any country is measured in terms of the computerized
accounting of the country. Computerized accounting plays a vital role in the accounting
department of an firm or a company. From the study, it is evident that the overall performance of
the firm with regard to Tally ERP is satisfactory.

Since the Master Care Air Con Services, is a firm they have to concentrate on the computerized
accounting system and check they financial statement and balance sheet and profit and loss
account at every month of the year not only at beginning of the accounting year.

The basic objective is to develop the business so that the local people need not relay upon others
for its requirements

As far as the other things are concern. The company provides the service facilities to the regular
customers. As they are the customers from longer period of time since the company are not
getting service facility and the time to do manual accounting. The company have to work on it
and have to improve the service facility. For building the good relationship with customers.

The company have to put more focus on the local sale mans the purchase of the Pune itself it will
leads to the increase in the demand as well as it leads to the better sales in the market as the
master care air con services is a local company they used to focus on the market as the whole
simply means they have to put the focus as well as a particular city. But still my suggestion is to
put more focus on the local areas also.

Yes I think the labour participation is less in the management. As I, analysis that the labour is
just for services. They never take the participation in the management decisions making process
as far as labours are concerns if we give the chance to the labour in the management to share
their views and ideas so that it will be very helpful for the management for the decisions making
process.

The company have to put focus on the additional service center.

Which they do servicing form of air conditioners located in the city.

If that service. Is start servicing in the local market as perthe demand of the market it will leads
to the maximisation of the profit.
If they work on it I think the demand of the product will be increase and the customer
satisfaction also.

I recommended to put more focus on the service center of the business. I do agree that the quality
standards are very much important than the cost form the point of view of the competition across
the price and cost impact on the demand of the air conditioner

Overall the project was useful and informative for me and helped me to know the computerized
accounting system of Master Care Air Con Services.
 FINDING

From the research I got the information and data regarding to the computerized accounting
system which were used in Pune

Regarding the Company and its Management

1. The company name is Master Care Air Con Services

2. It is a local company invested in Air Conditioners

3. The company is the dealer of air conditioners product of different variety

4. The dealership are as follows:-

 Voltas
 Panasonic
 Daikin

5. The company is now focusing on service center for customer satisfaction

6. The company put more focus on dealership than the service of the product and to
maintain the standard in the market

7. Daily selling of air conditioners are 25 units

8. There is a combination of 2 to 3 different brands that I cannot share it because of the

business secrecy purpose

9. 25 to 30 employees are working in the business

10. As the dealership is there they have targets in the units not in volume
11. This company have to maintain the standards and have to compete with others is the local
business helps in understanding the profitability measures and knowing to the
contribution of each brand

12. The company should use a new programme of Tally ERP. For new version

13. It will help in developing new knowledge.

14. The firm should concentrate on computerized accounting system Tally ERP.9

15. It will provide the accountant to gain more knowledge of Tally ERP.9
 CHAPTER 7

SUGGESTION AND RECOMEDATION

Suggestion and Recommendation

The suggestion and recommendation are as follows:-

1.) The company should improve computerized accounting system

The provides the computerized accounting system to the accountant. As they are the
accountant from a longer period of time since the company are not getting the good
computerized accounting system and the time to upgrade it. The company have to work
on it and have to improve the computerized accounting system. For having good business
with distributor. If they work on it I think the demand of computerized accounting system
will be increase and it will be a business satisfaction also.

2.) The company should concentrate on Tally ERP.9

The company have to put more focus on the Tally ERP.9 the purchase of Tally ERP.9
itself it will leads to the increase in the demand as well as it leads to the better accounting
in the market as the master care air con service is a local company they used to focus on
manual accounting as the simply means they have to put the focus on Tally ERP.9. but
still my suggestion is to put more focus on Tally ERP.9

3.) The service center has to focus on additional unit in Pune

The company have to put focus on the on the additional service center
Which they service form the client across Pune
It is the starting of the service center as per the demand of the market it will leads to the
maximization of the profits
 CHAPTER 8

BIBILIOGRAPHY

This Project/ Research work is based on both “A research design is the arrangement of
conditions for collection and analysis of data in manner the aims to combine relevance to the
research purpose with economy in procedure.” This study involves both primary and the
secondary data covering a period of 2018 and 2019 till date.

The primary data was collected by Questionary by asking some question to the Accountant of
Master Care Air Con Services

The secondary data was collected from company’s website for profile, magazines, articles
relating to Computerized Accounting System and to understand Tally ERP.9

Some important Books were refer:-

 The company visit

 The question was asked by me to the Manager of the company (Pune)
 The books on the Computerized Accounting System the name were as follows:-
1.) Computerized Accounting System-NCERT
2.) Computerized Accounting System-Textbook
3.) Computers And Accounting System-Bibliography
4.) Computerized Accounting System-A Practical Guide
5.) Computerized Accounting System-Tally ERP.9

The journals of the Computerized Accounting Systems

1. The journal issued by the ICMAI

2. Journal on Tally ERP.9
The website were used to collect the information of the Computerized Accounting System as
well as for the company information also

The website used for collecting the company information:-

1. www.mastercareairconservices.com
2. www.mastercare.in.com
3. www.mastercareairservicecenter.in

The website is used for the collecting te information on the Computerized Accounting
System and its techniques:-

1. www.information on computerized accounting system

2. www.icmai.in
3. www.tallyerp9.in
4. www.wekipedia/computerizedaccountingsystem.com
5. www.wekipedia/tallyerp9.com

Company Visit

I visited the firm Master Care Air Con Services for collection of the data and basic
information

This visit helps me in the understanding of the computerized accounting system in a business
unit to take the information of Computerized Accounting System to study Tally ERP.9
 CHAPTER 9

APPENDIX

I asked Question Some Question to the Accountant of the Master Care Air Con Services

QUESTIONARIES WAS AS FOLLOWS

 What is Computerized Accounting?

Accounting is the method in which financial information is gathered

 What are the problems faced in computerized accounting system?

User Training, System Dependency, Hardware Requirement, System Failure, Backups
And Prints, Voucher Management, Security

 What are the advantage of computerizes accounting system?

Better Quality Work, Lower Operating, Improved Efficiency, Facilitates Better Control,
Greater Accuracy

 What are the disadvantages of computerized accounting system?

Reduction Of Manpower, High Cost, Require Special Skill, Other Problems

 Describe the various types of accounting system?

Tally ERP, Ready to use

 Distinguish between a Manual And Computerized Accounting System?

The main difference between manual and computerized system is speed

 Computerized accounting system are best of accounting system. Do You Agree?

Yes, accounting refers to identifying transaction and events them in the books of accounts
and produce meaningful information for the series.
 What is the need of computerized accounting system?
The need for computerized accounting arises from advantage of speed and accuracy and
lower cost of handling the business transactions.

 What is computerized Payroll accounting?

Computerized payroll accounting system allow you to process all your normal payroll
tasks via a computerized system, rather than by hand.

 Why is a manual accounting system not feasible for most businesses?

There may be too many transactions that cannot be maintained in a manual system.

 When the company started to use Computerized Accounting System?

It is started 2 years back 2017

 What is the name of the company/ Business Firm?

It is Master Care Air Con Services

 Is it an local business because you said Master Care Air Con Services?
Yes it is an local business located in Pune and Bangalore

 You are working as?

I am working as an accountant

 Sir how long you have been in the accountant profession?

Since 5 Years

 What kind of business is going on?

The business mainly deals in air conditioners and have the clients such as local clients,
corporate client, institution client and so on.

 How many dealership do you have currently over here?

There are 3 types of dealership such as
1. Voltas
2. Daikin
3. Panasonic
 The computerized accounting system is used for which office?
It is used in both office in Pune as well as Bangalore

 How much time it takes to do Tally ERP.9 System?

Approx a half a day

The End