The Profit and Loss statement and Balance Sheet are the two most important financial reports for any business. In Tally Prime, generating them takes seconds — but reading them correctly, customising them, and ensuring they are accurate requires knowing what you are doing.
This guide covers how to generate P&L and Balance Sheet in Tally Prime, how to read and interpret them, common issues, and how to export them for your CA or management team.
What is the Profit and Loss Statement?
The Profit and Loss (P&L) statement, also called the Income Statement, shows your business's revenue, expenses, and profit (or loss) over a period. It answers: Did the business make money this month/year?
Key components in Tally P&L:
- Gross Profit = Net Sales − Cost of Goods Sold (opening stock + purchases − closing stock)
- Operating Profit = Gross Profit − Operating Expenses (salaries, rent, utilities, etc.)
- Net Profit = Operating Profit + Other Income − Finance Costs − Depreciation − Tax
What is the Balance Sheet?
The Balance Sheet shows the business's financial position at a specific point in time. It answers: What does the business own, and what does it owe?
Key components:
- Assets — Fixed assets (machinery, computers) + Current assets (cash, debtors, stock)
- Liabilities — Long-term (loans) + Current liabilities (creditors, GST payable, TDS payable)
- Capital / Net Worth — What the owner has invested + accumulated profits
The accounting equation: Assets = Liabilities + Capital. The Balance Sheet always balances.
How to Generate P&L in Tally Prime
Method 1: From Gateway of Tally
- Go to Gateway of Tally
- Click on Reports in the left panel
- Select Profit & Loss A/c
- The P&L for the current financial year opens automatically
Method 2: Using Alt+G (Go To)
- Press Alt+G from anywhere in Tally
- Type P&L or Profit
- Select Profit & Loss A/c from results
- Press Enter
Changing the date range
By default, P&L shows the full financial year (April–March). To change the period:
- Press Alt+F2 to change the period
- Enter the From and To dates
- For a single month: From = 1-Apr-2025, To = 30-Apr-2025
How to Generate Balance Sheet in Tally Prime
- Go to Gateway of Tally → Reports → Balance Sheet
- Or press Alt+G and type "Balance Sheet"
- The Balance Sheet shows as at the last date of your selected period
The Balance Sheet shows a single point in time — it does not make sense to show a Balance Sheet for a "period" in the same way as P&L. Press F2 to change the "as on" date.
Viewing P&L and Balance Sheet: Key Shortcuts
| Shortcut | Action in P&L / Balance Sheet |
|---|---|
| F1 | Toggle between Detailed and Condensed view |
| F5 | Toggle ledger-wise view (see individual ledger amounts) |
| Ctrl+F10 | Add columns — compare multiple periods side by side |
| F7 | Show differences between periods (when multi-period view is on) |
| Alt+F1 | Detailed view of selected account group |
| Enter | Drill down into any account to see individual transactions |
| Ctrl+B | Switch between Accrual and Cash basis |
| Alt+P | Print the report |
| Alt+E | Export to Excel or PDF |
| Alt+M | Email the report directly from Tally |
Adding Comparison Columns (Multi-Period View)
One of the most useful features for business owners is comparing P&L across periods. Press Ctrl+F10 to add comparison columns:
- This year vs last year (same period)
- Month vs month
- Quarter vs quarter
- Budget vs actual (if budgets are set up)
This gives a powerful two-column or three-column financial statement — the kind your CA and investors expect.
How to Read the Tally P&L: Common Issues
Issue 1: Purchases and sales are not showing
Tally P&L shows Sales under "Revenue" and Purchases under "Cost of Goods Sold" (or "Direct Expenses"). If your sales/purchase ledgers are grouped wrongly, they will not appear in the right place.
Check: All sales ledgers must be under Sales Account group. All purchase ledgers must be under Purchase Account group.
Issue 2: Closing stock not showing
If you use inventory management in Tally, closing stock is auto-calculated from stock transactions. If stock is missing from P&L, check:
- Stock items are correctly configured in inventory
- Opening stock is entered (via Opening Stock entry or stock journal)
- The company feature "Maintain stock items" is enabled in F11
Issue 3: Expenses appearing on the wrong side
In Tally P&L: expenses with a debit balance appear on the left (expenses side). Revenue with a credit balance appears on the right. If something appears on the wrong side, the ledger may have a negative or reversed balance — investigate the vouchers.
Issue 4: Suspense account balance
A common sign of incomplete bookkeeping: a "Suspense" or "Temporary" ledger has a non-zero balance. Every suspense entry should be cleared before finalising P&L.
Issue 5: Balance Sheet does not balance
In Tally, the Balance Sheet always balances mathematically — but if it shows a large "Profit & Loss" difference or unexplained balance, it usually means:
- Opening balances were entered with errors
- Some entries were made directly to Capital accounts instead of through P&L
- Journal entries have a debit/credit imbalance (which Tally should not allow, but sometimes happens with imported data)
Customising the P&L View
Press F12 in the P&L screen to configure:
- Show/hide specific account groups
- Change the format (Vertical / Horizontal)
- Show percentages (% of revenue) alongside amounts — useful for margin analysis
- Show previous year figures
- Format numbers (lakhs, crores)
Exporting P&L and Balance Sheet
To send your P&L or Balance Sheet to your CA, bank, or management team:
- Open the report
- Press Alt+E
- Select format: Excel (editable), PDF (clean, non-editable), or XML (for data exchange)
- For Excel: the report opens in a formatted spreadsheet with all figures
- For PDF: suitable for sharing with banks and investors
To email directly: Press Alt+M, enter the recipient's email, and send from within Tally.
Ensuring Your P&L is Accurate
The accuracy of your P&L depends entirely on the accuracy of your bookkeeping. Key checks:
- All bank transactions are recorded and reconciled
- All purchase and sales invoices are entered
- Closing stock is correct (physical count vs Tally stock)
- All depreciation entries are posted
- No suspense or clearing account balances remain
If your bookkeeping is behind or inaccurate, your P&L will be misleading — and decisions made on that data will be wrong.
Need Clean Books for Accurate Reports?
AutoTally handles your Tally bookkeeping from end to end — data entry, bank reconciliation, GST compliance, and monthly financial reports. When we deliver your books, your P&L and Balance Sheet are ready to share with your CA, bank, or investors immediately.
Get a free quote — or explore our Financial Reporting service for monthly MIS delivery.