Lesson Plan

• Describe the main types of internal and external users of accounts and the information they require.
• Explain how lenders and investors use key financial ratios to assess risk and profitability.
• Apply a decision‑making process to calculate and interpret ratios from sample financial statements.
• Evaluate financial information to make a justified recommendation on lending or investing.
• Compare ratio outcomes with benchmark criteria to support business decisions.

• Projector and screen
• Whiteboard and markers
• Printed handouts of financial statements and ratio tables
• Calculator worksheets
• Laptop with spreadsheet software
• Sample case study (XYZ Ltd) printed for each student
• Sticky notes for exit ticket

Begin with a quick real‑world hook: ask students how a bank decides whether to grant a loan to a new company. Recall prior learning about the purpose of financial statements and introduce today’s success criteria – students will be able to identify key users, calculate essential ratios, and use them to justify a lending or investment decision.

1. Do‑now (5'): Students match user types to the information they need (handout). Teacher checks answers.
2. Mini‑lecture (10'): Review key financial statements and introduce main ratios (current, quick, debt‑to‑equity, profit margins, ROCE) with examples on the projector.
3. Guided practice (15'): Work through the XYZ Ltd case – calculate each ratio together and discuss interpretation for lenders and investors.
4. Group activity (15'): Small groups receive a different scenario (investor or supplier) and use the same data to decide on a recommendation, completing a decision‑making checklist.
5. Whole‑class debrief (10'): Groups present findings; teacher highlights common errors and links back to the decision‑making steps.
6. Exit ticket (5'): Students write one key takeaway and answer: “Which ratio would a lender view first and why?”

Summarise how different users rely on specific ratios to inform their decisions and revisit the decision‑making checklist. For the exit ticket, students submit their takeaway and the ratio justification. Assign homework to find a recent news article about a company’s loan or investment and identify the financial information that would have been examined.