3 Chart of Accounts: Groups & Ledgers

This chapter explains the structure of the Chart of Accounts in Tally Prime, and gives step-by-step procedures to create Primary Groups, Sub-Groups, and Ledgers (single and bulk).

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3.1 Overview — Concepts

• Group of Accounts: A way to classify ledgers. Groups can be Primary (root) groups or Sub-groups.
• Primary Group: e.g., Capital Account, Current Assets, Current Liabilities, Direct Expenses.
• Sub-Group: Group under a primary group, e.g., Sundry Creditors under Current Liabilities.
• Ledger: Individual account (e.g., Cash, Bank of India, Rent Expense) that belongs to a group.

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3.2 Typical Group hierarchy (example)

Level	Example
Primary Group	Current Assets
Sub-Group	Bank Accounts
Ledger	Bank of India - Current A/c

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3.2.1 Creating a Primary Group

1. Open Tally Prime and go to Gateway of Tally.
   
2. Select Accounts Info. → Groups → Create.
   
3. In Name, type the group name, e.g., Bank Accounts.
   
4. In Under, choose the parent group (for a primary top-level choose a suitable primary group, e.g., Current Assets).
   
5. If required, set Maintain balances bill-by-bill or other group-specific features.
   
6. Press Ctrl + A to accept and save.

Example

• Name: Bank Accounts
  
• Under: Current Assets
  
• Accept → Group saved.

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3.2.2 Creating a Sub-Group

Follow the same steps as Primary Group creation, but choose a different Under value.

Example

• Name: Cash at Branch
  
• Under: Bank Accounts (the sub-group’s parent)
  
• Accept → Sub-group saved.

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3.2.3 Creating a Single Ledger (Step-by-step)

1. Gateway of Tally → Accounts Info. → Ledgers → Create.
   
2. In Name, enter ledger name (e.g., Cash in Hand - Chennai).
   
3. Under → choose the appropriate Group (e.g., Cash-in-Hand or Bank Accounts).
   
4. Enter Opening Balance if required (e.g., Dr 10,000).
   
5. Provide other fields as needed:
   • Inventory values are affected: Yes/No
     
   • Mailing details (address, GSTIN) — if required for statutory ledgers
     
6. Press Ctrl + A to save.

Example

• Name: Cash in Hand - Chennai
  
• Under: Cash-in-Hand (Primary Group: Current Assets)
  
• Opening Balance: Dr 12,000
  
• Save.

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3.3 Alteration (Modify) of Groups and Ledgers

3.3.1 To Alter a Group

1. Gateway of Tally → Accounts Info. → ’Groups → Alter`
   
2. Choose the group to alter.
   
3. Modify fields (Name / Under / other options).
   
4. Press Ctrl + A to save.

3.3.2 To Alter a Ledger

1. Gateway of Tally → Accounts Info. → ’Ledgers → Alter`
   
2. Select the ledger.
   
3. Change details (e.g., Group or Opening Balance).
   
4. Press Ctrl + A to save.

Note: Changing a ledger’s parent group affects reports. Always back up before major changes.

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3.4 Deletion of Ledgers and Groups

⚠️ Warning: Deleting accounts with transactions can cause data issues. Use Alter → Set to Inactive where possible, or take a backup first.

3.4.1 To Delete a Ledger

1. Gateway of Tally → Accounts Info. → ’Ledgers → Alter`
   
2. Select the ledger.
   
3. If allowed, press Alt + D (or choose Delete) and confirm.
   
4. If transactions exist, Tally will block deletion.

3.4.2 To Delete a Group

1. Gateway of Tally → Accounts Info. → ’Groups → Alter`
   
2. Select the group.
   
3. Press Alt + D to delete.
   
4. Ensure all ledgers or child groups inside it are deleted or reassigned first.

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3.5 Examples:

3.5.1 Example Chart for a Small Business

• Current Assets
  • Cash-in-Hand
    • Cash in Hand - Chennai (Ledger)
    • Petty Cash (Ledger)
  • Bank Accounts
    • Bank of India - Current (Ledger)
• Current Liabilities
  • Sundry Creditors (Ledger)
• Indirect Expenses
  • Rent Expense (Ledger)
  • Travel Expense (Ledger)
• Sales Accounts
  • Sales (Ledger)

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3.6 Illustration

1. Statrted Business with the Capital ₹10,00,000
   Cash A/c Dr. 10,00,000
     To Capital A/c 10,00,000

2. Purchased goods for cash ₹10,000
   Purchase A/c Dr. 10,000
     To Cash A/c 10,000

3. Purchased stationery ₹500
   Stationery A/c Dr. 500
     To Cash A/c 500

4. Purchased furniture ₹3,000
   Furniture A/c Dr. 3,000
     To Cash A/c 3,000

5. Sold goods for cash ₹8,000
   Cash A/c Dr. 8,000
     To Sales A/c 8,000

6. Sold goods to Geetha ₹3,000
   Geetha A/c Dr. 3,000
     To Sales A/c 3,000

7. Paid rent ₹800
   Rent A/c Dr. 800
     To Cash A/c 800

8. Sold goods to Latha ₹2,000
   Latha A/c Dr. 2,000
     To Sales A/c 2,000

9. Paid salary ₹8,000
   Salary A/c Dr. 8,000
     To Cash A/c 8,000

10. Goods sold ₹50,000
    Cash A/c Dr. 50,000
      To Sales A/c 50,000

11. Commission paid ₹1,000
    Commission A/c Dr. 1,000
      To Cash A/c 1,000

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