Lesson Plan

• Describe the purpose of the income statement, balance sheet and cash‑flow statement.
• Calculate and interpret common liquidity, solvency, profitability, efficiency and market ratios.
• Conduct trend analysis and benchmark ratios against competitors or industry averages.
• Evaluate the limitations of ratio analysis in strategic decision‑making.
• Apply ratio findings to formulate a concise strategic recommendation.

• Projector and screen
• Whiteboard and markers
• Printed handouts of sample financial statements (XYZ Ltd. & ABC Ltd.)
• Calculator or spreadsheet software (Excel template)
• Ratio analysis worksheet
• Sticky notes for exit tickets

Begin with a quick question: “How does a business know if it’s getting stronger or falling behind its rivals?” Connect this to students’ prior knowledge of profit and loss statements. Explain that today they will learn to turn raw accounting data into clear performance indicators and will be judged on their ability to compute, analyse and communicate those indicators.

1. Do‑now (5’) – 3‑question quiz on the three main financial statements.
2. Mini‑lecture (10’) – Overview of the five ratio categories and key formulas.
3. Guided practice (15’) – Students calculate selected ratios for XYZ Ltd. using the Excel template.
4. Group activity (15’) – Teams perform trend analysis (2022‑2024) and benchmark XYZ against ABC, then draft a brief findings report.
5. Class discussion (10’) – Groups share interpretations; teacher highlights limitations of ratio analysis.
6. Exit ticket (5’) – Each student writes one strategic recommendation based on the analysis.

Recap the step‑by‑step process: collect statements, calculate ratios, analyse trends, benchmark, and translate insights into strategy. Collect exit tickets and remind students to complete a full ratio analysis of a company of their choice for homework, using the provided worksheet.