Key to lesson types AW GS V

BTEC NATIONAL BUSINESS UNIT 3: PERSONAL AND BUSINESS FINANCE

© Pearson 2016 1

Lesson Topic Lesson

type Suggested activities Classroom resources

Topic A: Understand the importance of managing personal finance

1–2 Unit introduction

Topic A.1 Functions and

role of money

Functions of money and

associated factors:

o unit of account

o means of exchange

o store of value

Tutor presentation: Issue specifications to

discuss the unit, the learning outcomes, and the

mode of assessment.

Small-group activity; class discussion: Ask

learners to collaborate in small groups to come

up with examples of what money is, and to

develop a definition.

Class activity: Make notes on the different

functions of money.

Tutor presentation and

notes.

Small dry wipe boards for

paired activity.

Unit title Personal and Business

Finance

Key to lesson types

Guided learning

hours 120

AW Assignment

writing

AW Revision

session

Number of

lessons 60 GS Guest speaker V Visit

Duration of

lessons 2 hours

IS Independent

study

WE Work

experience

Links to other units

Unit 7: Business Decision Making

Unit 10: Recording Financial Transactions

Unit 11: Final Accounts for Public Limited

Companies

Unit 12: Financial Statements for Specific

Businesses

Unit 13: Cost and Management Accounting


© Pearson 2016 2

Lesson Topic Lesson


o legal tender.

Role of money is affected

and influenced by a

number of factors:

o personal attitudes

towards risk and

reward, borrowing,

spending and saving

o life stages

(childhood,

adolescence, young

adult, middle age,

old age), key

features of each

stage, financial

needs and

implications at each

stage

o culture including

religious and ethical

beliefs

o life events can vary

the personal life

cycle from individual

to individual

o external

influences/trends

and the financial-

related effects

o interest rates, cost

of borrowing versus

reward of saving.


© Pearson 2016 3

Lesson Topic Lesson


3–4 Topic A.1 Functions and

role of money

Functions of money and

associated factors:

o unit of account

o means of exchange

o store of value

o legal tender.

Role of money is affected

and influenced by a

number of factors:

o personal attitudes

towards risk and

reward, borrowing,

spending and saving

o life stages

(childhood,

adolescence, young

adult, middle age,

old age), key

features of each

stage, financial

needs and

implications at each

stage

o culture including

religious and ethical

beliefs

o life events can vary

the personal life

cycle from individual

Tutor presentation: Go through the different

stages of the life cycle with the class.

Paired practical activity: Split the group into

pairs and give each pair a blank timeline to fill

in. Every five years is a good guide. Get them,

in pairs, to think about what products or

services they may need to buy during the

timeline. For example, buying a car, buying a

house, going to university, pension or

retirement. You could also encourage them to

think about the financial products they may

need to use. Just let the group show what prior

knowledge they have on financial products.

These will be covered in more detail later.

Class discussion: Learners should feed back

the results from the paired activity onto the

whiteboard. Get the class to discuss key

findings. Highlight differences in personal

attitudes to buying a house and how religion

can impact on your financial choices.


notes.

Small dry wipe boards for

paired activity.


© Pearson 2016 4

Lesson Topic Lesson


to individual

o external

influences/trends

and the financial-

related effects

o interest rates, cost

of borrowing versus

reward of saving.

5–6 Topic A.1 Functions and

role of money

Planning expenditure,

common principles to be

considered in planning

personal finances:

o to avoid getting into

debt

o to control costs

o avoid legal action

and/or repossession

o remain solvent

o maintain a good

credit rating

o avoid bankruptcy

o to manage money to

fund purchases

o generate income

and savings

o set financial targets

GS/IS Class discussion: Ask learners to think about

the positive and negative consequences of

planning or not planning your finances. Try and

pick out the key words such as solvent,

bankruptcy, repossession, and credit rating.

Individual activity: Ask learners to research

the key terms and start making a glossary for

revision purposes.

Guest Speaker: Ask a guest speaker from the

local Citizens Advice Bureau to come and

explain the different consequences of poor

financial management.

Tutor-led discussion: Programmes like

Panorama or Bank of Mum and Dad can be a

useful medium to stimulate class discussion on

personal finance.

PC or laptops with internet

connection for research.

Whiteboard.

Video clips/player.


© Pearson 2016 5

Lesson Topic Lesson


and goals

o provide insurance

against loss or

illness

o counter the effects

of inflation.

7–9 Topic A.2 Different ways

to pay

The use of money as a

payment method,

advantages and

disadvantages of:

o cash

o debit card

o credit card

o cheque

o electronic transfer

o direct debit

o standing order

o pre-paid cards

o contactless cards

o charge cards

o store cards

o mobile banking

o Bankers’ Automated

Clearing Services

(BACS) Faster

Payments Service

IS Small-group activity, class discussion:

Divide learners into small groups and ask them

to come up with a list of different payment

methods. When they have completed this task,

ask them to write them on the whiteboard.

Paired practical activity: Divide each group

into pairs and give each pair a list of different

products that you might buy. Instruct them to

write next to each product the different

methods of payments that could be used.

Class discussion: Go through the list of

products and check the results of the learners.

Individual activity: Get the learners to

research the key terms and start making a

revision glossary.


notes.



Whiteboard.


© Pearson 2016 6

Lesson Topic Lesson


(FPS)

o Clearing House

Automated Payment

System (CHAPS).

10–11 Topic A.3 Current

accounts

Different types, features,

advantages and

disadvantages, different

services offered:

o standard

o packaged, premium

o basic

o student.

GS/V/

IS

Class discussion: Go round the class and write

down the bank and building society that they

have their current account with. Ask them to

explain why they chose that account.

Individual activity: Ask learners to research

their current account and look at the interest

they receive as well as other benefits that they

may have. Go round the group and find out who

has the highest interest rate.

Paired practical activity: Ask learners to

research the different current accounts that are

available. Give each pair a different bank or

building society to look at and find out the

different features or offers that are available.

Small-group activity: Ask the pairs to feed

back to their group and discuss the pros and

cons of each account.

Tutor presentation: Explain why the interest

rate is important and how the interest rate is

set.

Guest speaker: Try to arrange a visit to a local

financial institution or arrange a speaker to visit

your centre to talk about the different financial

products.


notes.



Whiteboard.


© Pearson 2016 7

Lesson Topic Lesson


12–13 Topic A.4 Managing

personal finance

Different types of

borrowing, features,

advantages and

disadvantages:

o overdraft

o personal loans

o hire purchase

o mortgages

o credit cards

o payday loans.

GS/V/IS Class discussion: Go around the class and

write down the different types of borrowing that

they are aware of. Learners should think about

the different products they would use these

types of borrowing for. Ask them to think about

and identify the most important features that

individuals would want to consider when

borrowing money.

Tutor-led discussion: Ask groups to feed back

their findings.

Individual practical activity/small-group

activity: Ask learners to collect leaflets from

their local financial institutions on a range of

products targeting lenders. Learners can then

go through the leaflets and highlight the key

information. If they cannot collect any leaflets,

then print outs from the internet can be used

instead.


financial institution or arrange for a speaker to

visit your centre to talk about different financial

products.

Small-group activity: Supply learners with

some case studies on different people in

different stages of the life cycle. Ask them to

write down which current account they would

suggest and to justify their answer.


notes.



Whiteboard.


© Pearson 2016 8

Lesson Topic Lesson



personal finances

Different types of saving

and investment features,

advantages and

disadvantages:

o individual savings

accounts (ISAs)

o deposit and savings

accounts

o premium bonds

o bonds and gilts

o shares

o pensions.

Risks and rewards of

saving versus

investment.

GS/V/IS Class discussion/small-group activity: Go

around the class and write down the different

types of savings that they are aware of.

Learners should think about the different

products they would use these types of savings

for. Ask them to think about and identify the

important features that savers and investors

would want to consider.

Tutor-led discussion: Ask groups to feed back

their findings.


activity: Ask learners to collect leaflets from

their local financial institutions on a range of

savings and investment products. Learners can

then go through the leaflets and highlight the

key information. If they cannot collect any

leaflets, then print out from the internet can be

used instead.


financial institution or arrange for a speaker to

visit your centre to talk about different financial

products.

Small-group activity: Give the learners some

case studies on different people in different

stages of the life cycle. Ask them to write down

which type of savings account they would

suggest and get them to justify their answer.


notes.



Whiteboard.


© Pearson 2016 9

Lesson Topic Lesson



personal finances

Different types of

insurance products,

features, advantages and

disadvantages:

o car

o home and contents

o life assurance and

insurance

o travel

o pet

o health.

GS/V/IS Group discussion: Go round the class and

write down the different types of borrowing that

they are aware of. Get the group to think about

the different products they would use these

types of borrowing for. Ask them to think what

would be the most important features that a

lender would want to look at when you borrow

money.

Tutor-led discussion: Get the groups to feed

back their findings.


activity: Get the learners to collect leaflets

from their local financial institutions. The

learners can then go through the leaflets and

high light the key information. If they cannot

collect any leaflets, then print out from the

internet can be used.


financial institution or arrange a speaker to visit

your centre to talk about the different financial

products.

Small-group activity: Give the learners some

case studies on different people in different

stages of the life cycle. Ask them to write down

which insurance they would suggest and get

them to justify their answer.


notes.



Whiteboard.

Topic B: Explore the personal finance sector

19 Topic B.1 Features of

financial institutions

Types of organisations

and their advantages and

Paired activity: Give each pair or small group

a financial institution to research the role and

responsibilities they play within the financial

industry.


notes.




© Pearson 2016 10

Lesson Topic Lesson


disadvantages:

o Bank of England

o banks

o building societies

o credit unions

o National Savings

and investments

o insurance companies

o pension companies

o pawnbrokers

o payday loans.

Paired activity/small-group activity: Each

pair could present their research back to the

group. Once these have been completed the

learners can share copies of their presentation.

Small-group activity: They could discuss

which financial institution they think they would

prefer to use and why.

Whiteboard.

20 Topic B.2

Communicating with

customers

Methods of interacting

with customers,

advantages and

disadvantages:

o branch

o online banking

o telephone banking

o mobile banking

o postal banking.

IS Small-group activity: Get each group of

learners to research all of the different ways

that financial institutions interact with their

customers.

Small-group activity: Assign each group one

method of communication and ask them to feed

back the advantages and disadvantages to the

group. Write these down on the whiteboard and

ask learners to take notes so they have a

comprehensive list for revision purposes.

Small-group activity: Ask learners to consider

what type of customer would suit each type of

communication method. Also ask them to look

at which method would be best linked to which

financial products.

Individual activity: As an extension activity,

ask learners to research the benefits to the

financial institution of different methods of

communication and improvement in technology.


notes.



Whiteboard.


© Pearson 2016 11

Lesson Topic Lesson


21 Topic B.3 Consumer

protection in relation to

personal finance

Function, role and

responsibilities of:

o Financial Conduct

Authority (FCA)

o Financial

Ombudsmen Service

(FOS)

o Financial Services

Compensation

Scheme (FSCS)

o Office of Fair Trading

(OFT)

o legislation:

consumer credit.

GS/IS Tutor presentation: It is probably better for

you to lead on this topic, but it will depend on

the group you have. Go through each

organisation and ask learners to make notes. If

you go on the websites, they contain good

outlines on the role of each organisation. They

also have some good videos that can be used to

engage your learners.

Individual activity: Once you have taken

them through the different organisations,

learners could carry out some research to find

some examples of how consumers have been

protected. You could look at government

interventions into PPI mis-selling or payday

loans companies. It is worth keeping a look out

for recent TV programmes such as Watchdog,

Panorama and Dispatches as these all cover

issues with the banking sector and can be a

useful tool for stimulating class discussion.

Guest speaker: Try to arrange for a speaker to

visit your centre to talk about the different ways

consumers are protected.


notes.



Whiteboard.

Video clips/screen.

22 Topic B.4 Information

guidance and advice

Function, role and

responsibilities,

advantages and

disadvantages of:

o Citizens Advice

o independent

financial advisor

(IFA)

GS Small-group activity: Assign each group a

different organisation to investigate. Some of

them have very good websites that are very

informative and contain some good videos.

Individual activity: Give learners some

different scenarios and set them a competition

as to who can find the cheapest car insurance

or best current account using price comparison

websites. Also ask learners to research why

some financial companies do not use these


notes.



Whiteboard.


© Pearson 2016 12

Lesson Topic Lesson


o price comparison

websites

o money advice

service

o debt counsellors

o Individual Voluntary

Arrangements

(IVAs)

o bankruptcy.

comparison websites.

Guest speaker: Try to arrange a speaker to

visit your centre from an independent financial

advisor.

Tutor-led discussion: There are some good

TV programmes about debt and bailiffs that can

be a useful tool to stimulate class discussion

and debate.

23 Recap, Revision and

mock exam on personal

finance

RS Revision session: Recap and revision.

Mock exam and feedback.

Topic C: Understand the purpose of accounting

24–25 Topic C.1 Purpose of

accounting

Recording transactions.

Management of business

(planning, monitoring

and controlling).

Compliance (preventing

fraud, compliance with

law and regulations).

Measuring performance.

Control: assisting with

the prevention of fraud,

trade receivables and

trade payables.

IS Tutor presentation: Introduce this part of the

unit. Explain to the learners that they are

moving on from personal finance to business

finance. Go through the topics that will be

covered.

Group discussion: Get the learners to think

about why businesses produce accounts.

Class activity: Introduce the topic of double-

entry and go through some simple questions.

This will help the learners understand the topic

of control accounts.


notes.

Whiteboard.

26–27 Topic C.1 Purpose of

accounting

IS/GS Tutor presentation: Follow on from the work

on double-entry from the previous lesson and


notes.


© Pearson 2016 13

Lesson Topic Lesson


Recording transactions.

Management of business

(planning, monitoring

and controlling).

Compliance (preventing

fraud, compliance with

law and regulations).

Measuring performance.

Control: assisting with

the prevention of fraud,

trade receivables and

trade payables.

go through the layout for the different control

accounts. Explain the purpose for the Trade

Receivables Control Account and the Trade

Payables control accounts.

Call activity: Ask learners to answer questions

on control accounts. They could work in pairs if

this is easier

Guest speaker: Try to arrange for a speaker

from a local accounting firm to discuss the

purpose of accounting.

Template/examples of

different control accounts.



Whiteboard.

28 Topic C.2 Types of

income

Capital income:

o loan

o mortgages

o shares

o owner’s capital

o debentures.

Revenue income:

o cash sales

o credit sales

o rent received

o commission received

o interest received

o discount received.

RS/IS Revision session: It is worthwhile testing

recall or going over previous work from topics A

and B as the course progresses. This allows it to

remain fresh in the learners’ minds. Try to

introduce a ten-minute test at the start of each

lesson. Or look at essay technique if learners

require support.

Small-group discussion: Ask learners to look

at the different types of income a business

could have.

Tutor presentation/individual activity: Go

through the difference between revenue income

and capital income and ask learners to

categorise their research and put them under

the correct headings.


notes.



Whiteboard.


© Pearson 2016 14

Lesson Topic Lesson



expenditure

Capital expenditure:

o non-current assets:

tangible (land,

buildings and

premises, machinery

and equipment,

vehicles, fixtures

and fittings)

o intangible (goodwill,

patents,

trademarks, brand

names).

Revenue expenditure:

o inventory

o rent

o rates

o heating and lighting

o water

o insurance

o administration

o telephone

o postage

o stationery

o salaries

o wages

o marketing


Small-group discussion: Get the learners to

look at the different types of expenses a

business could have. Again, ask groups to

categorise these as capital expenses or revenue

expenses. Explain that only revenue expenses

and revenue income will impact on profit and go

through some very simple profit calculations.


notes.



Whiteboard.


© Pearson 2016 15

Lesson Topic Lesson


o bank charges

o interest paid

o straight-line

depreciation

o reducing balance

depreciation

o discount allowed.


Expenditure

Capital expenditure:

o non-current assets:

tangible (land,

buildings and

premises, machinery

and equipment,

vehicles, fixtures

and fittings)

o intangible (goodwill,

patents,

trademarks, brand

names).

Revenue expenditure:

o inventory

o rent

o rates

o heating and lighting

o water

o insurance

o administration


Tutor presentation/individual or paired

activity: Go through the two different methods

of depreciation – straight-line and reducing

balance. Get the learners to practise these

calculations. This could be carried out in pairs.


notes.

Whiteboard.

Examples for calculating the

methods of depreciation –

for reference and for

learners to practise.


© Pearson 2016 16

Lesson Topic Lesson


o telephone

o postage

o stationery

o salaries

o wages

o marketing

o bank charges

o interest paid

o straight-line

depreciation

o reducing balance

depreciation

o discount allowed.

Topic D: Select and evaluate sources of business finance

31–32 Topic D.1 Sources of

finance

Advantages,

disadvantages, short term

and long term:

internal:

o retained profit

o net current assets

o sale of assets.

external:

o owner’s capital

o loans

o crowd-funding


Small-group discussion: Ask learners to

come up with a list of sources from which a

business can obtain finance (they could use the

internet to help).

Tutor-led activity: Ask group members to

feed back their findings and write these down

on the whiteboard.


notes.



Whiteboard.


© Pearson 2016 17

Lesson Topic Lesson


o mortgages

o venture capital

o debt factoring

o hire purchase

o leasing

o trade credit

o grants

o donations

o peer to peer lending

o invoice discounting.

33 Mock Exam RS Mock Exam.

Topic E: Break-even and cash flow forecasts

34–36 Topic E.1 Cash flow

forecasts

Inflows/receipts:

o cash sales

o credit sales

o loans

o capital introduced

o sale of assets

o bank interest

received.

Outflows/payments:

o cash purchases

o credit purchases

o rent

IS Small-group discussion: Ask learners to draw

up a list of cash inflows and cash outflows. Get

them to look at problems that cash flow may

have with credit sales.


through the main components and layout of a

cash flow forecast – inflows, outflows, net cash

flow, opening balance and closing balance. Get

the learners to complete several of these.


through the different ways that businesses can

improve their cash flow position and ask the

learners to answer some case study questions.


notes.



Whiteboard.

Template of a cash flow

forecast.

Case studies of cash flow

position.

www.s-cool.co.uk/a-

level/business-

studies/company-

accounts/revise-it/cash-flow.


© Pearson 2016 18

Lesson Topic Lesson


o rates

o salaries

o wages

o utilities

o purchase of assets

o Value Added Tax

(VAT)

o bank interest paid.

Prepare, complete,

analyse, revise and

evaluate cash flow.

Use of cash flow forecasts

for planning, monitoring,

control, target setting.

Benefits and limitations

of cash flow forecasts.

37–39 Topic E.2 Break-even

analysis

Costs:

o variable

o semi-variable

o fixed

o total.

Sales:

o total revenue

o total sales

o selling price per unit

o sales in value and/or

Paired practical activity: Give learners

definitions of fixed, variable and semi-variable

costs. Give them a list of different costs and ask

them to match them to the correct heading.


through the main components of the break-

even chart and show the learners how to

calculate total revenue, variable cost and fixed

costs. Show the learners how to draw and fully

label a break-even chart.

Individual activity: Give learners plenty of

exercises to calculate break-even and correctly

draw the chart.

Tutor presentation: Go through the


notes.



Whiteboard.

Graph paper.


© Pearson 2016 19

Lesson Topic Lesson


units.

Calculation

using/manipulating,

break-even formula

(units and/or sales

value), completion of

break-even chart, break-

even point.

Identification of area of

profit, area of loss.

Identify and calculate

margin of safety (units

and value).

Calculation of total

contribution, contribution

per unit benefits and

limitations.

Use of break-even for

planning, monitoring,

control, target setting.

Prepare, complete,

analyse, revise and

evaluate break-even.

importance of contribution and how contribution

could impact on the choices available to

businesses.

Topic F: Complete statements of comprehensive income and financial position and evaluate a business’s performance

40–42 Topic F.1 Statement of

comprehensive income

Purpose and use.

Completion, calculation

and amendment to

Tutor presentation: Go through the main

components of the Statement of Comprehensive

Income. Give the learners a template of the

Statement of Comprehensive Income and go

through completing one.

Paired practical activity: Let the learners


notes.

Templates of Statement of

Comprehensive Income.



© Pearson 2016 20

Lesson Topic Lesson


include gross profit

(revenue, opening

inventories, purchases,

closing inventories, cost

of goods sold),

calculation of profit/loss

for the year (expenses,

other income).

Adjustments for

depreciation (straight-line

and reducing balance).

Adjustments for

prepayments, accruals.

Interpretation, analysis

and evaluation of

statements.

work in pairs to complete questions on

completing these statements. It is worth giving

them the answers to gross profit and net profit

so they can check their work as they go

through.


Whiteboard.

www.s-cool.co.uk/a-

level/business-

studies/company-accounts.

43–45 Topic F.2 Statement of

financial position

Purpose and use.

Completion, calculation

and amendment of

statement using vertical

presentation to include:

o non-current assets

(tangible and

intangible, cost,

depreciation and

amortisation, net

book value)

o current assets

(inventories, trade

receivables,

Tutor presentation: Go through the main

components of the Statement of Financial

position. Give the learners a template of the

Statement of Financial Position and go through

how to complete one.

Paired practical activity: Let the learners

work in pairs to complete questions on

completing these statements. It is worth giving

them the answers to net current

assets/liabilities and net assets so they can

check their work as they go through.


notes.



Whiteboard.

Template/examples of the

Statement of Financial

Position.


© Pearson 2016 21

Lesson Topic Lesson


prepayments, bank,

cash)

o current liabilities

(bank overdraft,

accruals, trade

payables)

o net current

assets/liabilities

o non-current

liabilities (bank loan

and mortgage)

o net assets

o capital (opening

capital, transfer of

profit or loss,

drawings, closing

capital).

Adjustments for straight

line (cost x %),

depreciation, reducing

balance (cost –

depreciation to date x %).

Adjustments for

prepayments, accruals.

Interpretation, analysis,

and evaluation of

statements.

46–47 Topic F.1/F.2 The

statement together

IS Individual activity: Give the learners plenty of

practice on completing the financial statements.

Give them full sets of statements to fill in or get

them to fill in the blanks.

Template/examples of

financial statements.


© Pearson 2016 22

Lesson Topic Lesson


48–49 Topic F.3 Measuring

profitability

Calculation, interpretation,

analysis and evaluation of:

gross profit margin:

(gross profit/revenue) ×

100

mark-up: (gross

profit/cost of sales) ×

100

profit margin:

(profit/revenue) × 100

return on capital

employed (ROCE):

(profit/capital employed)

× 100.

IS Tutor presentation: Go through the formulae

to calculate profitability. Get the learners to

calculate these and draw some analysis from

their answers.

Class discussion: Encourage learners to think

of the different ways that a business could

improve its profitability and how this may

impact on the success of the business.

Individual activity: Give the learners plenty of

case studies to calculate and analyse the

formulae for profitability.

Formulae to calculate

profitability.

Practice exercises and case

studies.

http://beta.tutor2u.net/busi

ness/topics/ratio-analysis.

50 Topic F.4 Measuring

liquidity



current ratio: current

assets/current liabilities

liquid capital ratio:

(current assets –

inventory)/current

liabilities.


to calculate liquidity. Get the learners to


their answers.

Class discussion: Get the learners to think of

the different ways that a business could

improve its liquidity and how this may impact

on the success of the business.

Individual work: Give the learners plenty of


formulae for liquidity.

Formulae for liquidity and

practice case study material.

51 Topic F.5 Measuring

efficiency



to calculate efficiency. Get the learners to



notes.

Whiteboard.


© Pearson 2016 23

Lesson Topic Lesson



trade receivable days:

(trade receivable/credit

sales) × 365

trade payable days:

(trade payables/credit

purchases) × 365

inventory turnover:

(average inventory/cost

of sales) × 365.

their answers.

Class discussion: Get the learners to think of

the different ways that a business could

improve its efficiency and how this may impact

on the success of the business.

Individual activity: Give the learners plenty of


formulae for efficiency.

Formula for efficiency/case

studies and examples for

learners to practise and

refer to.

52 Topic F.6 Limitations of

Ratios

Limitations of ratios when

assessing business

performance

Tutor presentation: Go through the

limitations of ratios.


notes.

Whiteboard.

53–58 Revision (including

mock exam)

RS

59–60 Exam

Key to lesson types AW GS V

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