Learning Outcome 1.13
Monitor and calculate income and expenditure data, determine the financial position, recommend appropriate action and present the analysis in tabular and graphic formats.
Links to LO’s 1.2, 1.5, 1.12 and 2.12
In our view, the following are the key ideas and messages for this topic:
Immediately after the section on household budgeting we tackled Chapter 6 which deals with recording income and expenditure in the analysed cash book. The most relevant Learning Outcome here is 1.13: Monitor and calculate income and expenditure data, determine the financial position, recommend appropriate action and present the analysis in tabular and graphic formats.
Once again this is a topic which is very familiar to teachers of the ‘previous’ Junior Cert curriculum and I didn’t approach or teach it any differently than I had done in the past. I emphasised the difference between the PLAN of what was expected to happen (household budget) and the RECORD of what actually occurred (Analysed Cash Book).
At the outset at least this is very much a ‘teacher led’ topic as students need to be made aware of the basic rules, layout and procedures involved in recording financial information. Once they had a good grasp of these issues I spent a lot of time checking student work. At this stage the emphasis changes to a ‘learning by doing’ approach and the students had a lot of opportunities to practise their technique. As I observed student work I was focusing on their ability to correctly apply the book keeping rules as well as emphasising the need for neat and presentable work.
Inevitably the ‘balancing’ and ‘totalling’ tasks proved to be the most problematic for students. We worked through all of the questions in the Student Activity Book and I got students to complete many of them in Record Book 1. While I am aware that some other textbooks don’t seem to be promoting the use of Record Books for book keeping, when writing 'Time for Business' we have taken the view that this is a useful ability for students to acquire, especially if they are likely to keep personal financial records or go on to study accounting.
We completed this unit of learning by combining the material in chapters 5 and 6 and looked at budget comparison statements (chapter 7). The focus here was on analysing outcomes, identifying deviations from the plan and using the analysis to inform future planning.
It remains to be seen whether this is a specific requirement for the new JC specification but we felt that this approach helped students to appreciate the difference between financial planning and record keeping. Perhaps more importantly it enabled them to see planning as one step in a process (see financial control cycle diagram on p59 of TFB textbook) and understand that just making budgets is not enough. Plans need to be checked and evaluated against expectations and actual outcomes. The idea is to get students to reflect on the differences; figure out why they happened and how they can be avoided in the future. All in all this is the essence of effective financial planning, and to my mind, goes to the very heart of LO’s 1.12 and 1.13.
Chapter 5: Household Budgets
Having completed the previous chapters on household income and expenditure I decided to move straight to the section on household budgeting. It just seemed more logical to tackle the chapters in this order…or maybe it was just force of habit.
Learning Outcome 1.12 appears the most relevant here: “prepare and analyse a budget, determine the financial position, recommend appropriate action and present the analysis in tabular and graphic formats." (See the separate blog on LO. 1.12 for further discussion of this topic)
For those who’ve been teaching the previous, pre-2016 Business Studies syllabus, there is plenty of familiar material here, but the new specification has a distinct change of emphasis when it comes to the topic of household budgeting. While the ability to prepare a budget is an important skill, there seems to be a much greater focus on analysis and interpretation of the financial plan. A capacity to critically analyse and ‘make sense of’ the figures is much more in keeping with the spirit of the new specification. The references to ‘determining the financial position’ and ‘recommending appropriate action” provide strong and obvious clues to the shift in emphasis. There is also a requirement to use appropriate tables and/or charts to illustrate key patterns and findings and this is certainly a new departure from the more numerate approach of old.
I began by sticking to the ‘old stuff’ and consolidating the material from previous income and expenditure chapters. Students again seemed to enjoy the ‘doing’ and ‘calculating’ part of this topic and most were soon able to complete the question templates with both speed and accuracy. The Student Activity Book (SAB) provided plenty of questions for students to practise and develop their skills. As ever, the final three lines of the ‘traditional’ household budget cause a few problems... both with understanding and with application, but a step-by step walk-through of one question resolved most issues. Further practice and a handful of one-to-one explanations helped clear up the rest.
I made a point of focusing on the ‘budget outcomes’ for each activity. After a few unsuccessful and ‘experimental ad lib’ attempts in class (that’s code for winging it!), I retrospectively generated a worksheet to guide student thinking for budget analysis. In hindsight it might have been helpful to include this in the SAB or Teacher Resource Book (TRB), but the need wasn’t as obvious at time of writing and really only became more apparent as students began to engage with the material. I suppose that reflects a major benefit of being both an author and a practicing teacher and having learned from the experience I am at least in a position to pass on my insight.
When analysing the household budgets I used the worksheet to focus student thinking on the key issues and insisted that they provide evidence to support all of their answers. A copy of this worksheet is available to download at the end of this post.
We next tackled some revised budget questions. We made a decision to include these in the book because they reflect the dynamic nature of household financial planning. They enable students to clearly see the need to adapt household planning in order to produce a budget which is appropriate to the changing financial circumstances of a household. Similar thinking can be applied to the inclusion of budget comparison statements which again reflects the link between planning and the financial reality facing a household. In the context of the learning outcome, having analysed the financial position and found the budget to be unrealistic the recommended course of action must surely be to prepare a revised budget which is more in keeping with the households financial circumstances.
Introducing a digital element…
In the past I would never have used ICT to teach this topic; let’s face it, there was never any need or encouragement to… but this new specification sometimes requires, and often promotes the use of digital elements. So, I took the class to the computer room for two forty minute periods. I prepared for the class by pre-saving a blank budget template in the dropbox on the school server. I used the Morgan budget on page 36 of the SAB. All students were able to access this file and I showed them how to enter data and to create formulas in order to calculate totals, net cash, opening cash and closing cash etc. Most students were excellent at this and I really was pleasantly surprised as how quickly they mastered the technology (only two had used Microsoft Excel previously). Many students were able to work ahead of my explanations, which I delivered via digital projector, and this allowed me to engage in small group work with the remainder. By the end of the classes all students were capable of correctly completing a digital version of the Morgan and El Masri budgets. Had time (and computer room access) allowed I would certainly have availed of this technology to help with the section on revised budgets. The fact that the digital version updates all the calculations whenever a number is changed makes it ideal for revised budgets, but at least students were able to engage with the technology and appreciate its benefits. I will definitely make more use of this approach when teaching this topic next time round.
* I am aware that there is a digital resource which can be used to generate pie charts from a given set of figures. It was developed for use with an Edco maths book. I had an opportunity to try it out while writing the textbook. I will enquire again about having it added to our digital resources. There may also be some free resources available online.
Business Studies Blog
Chapter 2 : Household Income
Having completed the chapter on ‘resources’ I began to teach my students about the complementary topics of household income and household expenditure. From a teacher perspective this is very familiar material, but I used the anticipation exercises to establish the level of prior knowledge amongst my students. At the outset they had a relatively limited appreciation of the sources of household income, but this is hardly surprising given their age. Inevitably most students cited examples based on their personal or household circumstances.
We discussed a range of income sources for households, including employment income, pensions and other social protection payments. The only element of controversy in our discussion was the suggestion (by some students) that social protection payments should not be a long term source of household income and reliance on this form of income should not be a lifestyle choice. I assumed this was a case of students repeating some of the things they have heard at home and I used the opportunity to focus student’s thoughts on the purpose of taxation and the role of government in income redistribution.
I only dealt with this issue at a very simple and superficial level and some students showed greater levels of engagement with the discussion than others. Nonetheless, it was interesting to hear how clearly and passionately they were able to express their views. Overall, I was happy with the debate and accepted it was really just an opportunity for sowing seeds which can hopefully be harvested in future (Strand 3) discussions. On this occasion I felt however that the blending involved in these topics was too much of a detour for my students so I returned to the core topic of household income. In hindsight perhaps it was just too much of a detour for ME personally and maybe I should have allowed the discussion to explore those other avenues. I know I was concerned about the time involved and worried that we would drift too far from the lesson objectives. After all ‘time’ is a scarce resource, and I’m not exactly sure how best to use it on this first encounter with the new specification. The whole issue of time allocation has been a concern of mine ever since I started to write the textbook, but I’ll save that issue for a separate blog piece in the very near future.
Benefit in kind income proved to be a little confusing for some students while others found the calculation of wages to be problematic. This section illustrated perfectly the challenges associated with teaching a mixed ability group and there was a huge variation in the ability of my students to deal with calculations. For this reason it may be advisable to adopt a step by step approach to these questions and have some extra material available for those students who are particularly adept at numeracy.
Students understood the difference between statutory and voluntary deductions and were able to provide relevant examples of both. The distinction between disposable and discretionary income was not so easily understood, and on reflection I feel I could have explained it more clearly first time round. When the end of chapter self-assessment highlighted this confusion, I made a point of revisiting the topic, thankfully with more success.
The family income plans (in the student activity book) were completed with little difficulty and these are important steps in the household budgeting process (see Time for Business chapter 5).
Learning Outcome 1.2 states:
Identify and classify sources of income and expenditure, compare options available to best manage financial resources, evaluating the risks associated with each option and making informed and responsible judgements.
In our view, the following are the key ideas and messages for this topic:
The overarching aim of this learning outcome is the development of effective financial management skills.
The focus is on financial planning, risk assessment and the ability to choose between alternatives. Upon completion, students should be equipped to make informed financial decisions which are appropriate to their circumstances and life stage.
In his previous blog post, co-author of Time for Business Joe Stafford reflects on his experience of teaching Learning Outcome 1.1 for the first time. In this post, Joe shares how students are engaging with the new material, how they are already linking to material from Strand 3 and how many students didn't realise that they get a free e-book with the hard copy of the textbook.
Money Doesn’t Grow on Trees!
The last section of Chapter 1 deals with financial resources and the fact that “money doesn’t grow on trees”. Students offered great explanations of what that expression means and the discussions which followed gave rise to interesting questions, such as “Why doesn't the government just print lots of extra money?” I encouraged students to offer suggestions for this and some excellent answers were offered which related to money losing its value, etc. One student said that prices would probably rise, but she didn’t have the vocabulary to use the term ‘inflation’. I introduced the term and provided a very brief and simple explanation. Hopefully this will serve us well in Strand 3. The concepts of supply and demand also originated from students, although again they didn’t all have the understanding or vocabulary to deal with it in anything more than a very simple way. We used an example of concert tickets or the upcoming All Ireland Final to illustrate what happened when something we want is in strong demand but supply is strictly limited. This is also Strand 3 material and highlights how it’s almost impossible to avoid a blended approach to this new specification. I certainly had no intention when planning the lesson of introducing the concepts of supply and demand, but this accidental blending was unavoidable as the issue was raised by students. This will provide more opportunities for layering as we progress through the learning outcomes.
When addressing the question of where future income may come from, students managed to list all of the familiar sources including wages, income from benefits, pension and student grants. One student expressed strong views on the receipt of benefits as an ongoing source of income. We steered clear of a full blown debate on this issue, but it will surely be revisited in subsequent chapters dealing with household income and the purpose of taxation. Again, it was interesting to see how students engaged with the material and how it impacted on their thought processes.
Textbooks, Homework…and Abba!
I should mention that students didn’t have textbooks for the first couple of lessons. I therefore posed a series of questions to kick start the discussion and to scaffold student learning. I used the whiteboard and the Edco Digital site to display some segments of the textbook to the whole class, particularly the definitions, images and textbook activities, but we didn’t read through the chapter in its entirety. The benefit of this was that there was a lot of discussion and debate amongst the class group and I really think this helped with student engagement. I also used the whiteboard to record the key points made by students during discussions.
I tended to set a research task for homework to set the scene for the following lesson. Over the course of a week, the vast majority of students managed to get copies of text and activity books. At this stage I then assigned reading homework to ensure students had to engage with the text and revise material covered in class in previous lessons, for example, I asked the students to find some songs or quotations related to money. They really enjoyed this and found some very interesting quotations dealing with money, wealth and value, etc. Students were more than happy to read them out in class and we discussed what some of them really meant. For example, “nowadays people know the price of everything and the value of nothing” and “we buy things we don’t need, with money we don’t have, to impress people we don’t like”. Students are now in the process of making small posters using some of the quotations and these will be displayed in the classroom.
On the music side we had contributions from Jessie J (Price Tag) and Abba (Money, Money, Money). We had a bit of fun with this!
As the students did not have activity books from the outset, we had to tackle the activities in a large chunk at the end of the chapter. This was useful from the point of view of revision, but in future I will definitely have students use the activity book on an ongoing basis. Having said that, I was very happy that the textbook activities kept the students engaged and provided many opportunities for individual and group work. These activities were completed in their copies or comments were added to the white board.
E-books and PowerPoints.
I demonstrated to students how to access the free e-version of their textbook. This meant they could leave the textbook in their locker in school and could rely on the digital version for revision and homework. Some of the students hadn’t realised that this was possible and I was glad I’d brought it to their attention - as were they!
Although I had a PowerPoint presentation prepared to support the textbook material (and our PowerPoint’s will be available as a digital resource soon) I didn’t actually make use of it. The student discussions and group work seemed to me to be more in line with the spirit of the new specification. Due to the high level of student engagement I felt the PowerPoints were not required for my lessons on this topic. If using them in future I would be inclined to use them in the background or as a way of revising and summing up a topic.
Co-author of Time for Business Joe Stafford teaches Junior Cycle Business Studies in a mixed ability setting in a co-educational school with four 40 minute classes per week.
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