Lesson Note on Cheques: Forms, Crossing and Dishonoured Cheques for SS 2

Class: Senior Secondary School 2 (SS2 / SSS2)
Term: Second Term
Week: 3
Age: 16 years
Duration: 45 minutes
Subject: Commerce
Curriculum Theme: Banking Services
Previous Lesson: Bank Accounts: Current Account Procedures and Cheques.
Topic: FORMS OF CHEQUE
Subject Matter: Forms of cheque (stale cheque, post-dated cheque, certified cheque, bounced cheque, dishonoured cheque), crossed cheque (general crossing, special crossing), reasons for dishonouring cheques.

Specific Objectives

By the end of the lesson, pupils should be able to:

Cognitive Domain:

• Define various forms of cheques such as stale, post-dated, certified, bounced, and dishonoured cheques.
• Explain the concept of crossed cheques.
• List reasons why a cheque may be dishonoured by a bank.

Affective Domain:

• Appreciate the importance of handling cheques properly.
• Recognize the implications of different forms of cheques in financial transactions.

Psychomotor Domain:

• Differentiate between general and special crossing of cheques.
• Demonstrate proper procedures for issuing and receiving cheques in a role-play scenario.

Social Domain:

• Collaborate with peers during role-playing activities to understand cheque processing.

Reference Materials

The following resources were used in planning this lesson:

• Senior Secondary Schools Education Curriculum
• State Unified Scheme of Work
• Commerce for Senior Secondary Schools by E.O. Olaniyan.
• https://passnownow.com/class/ss2/commerce/forms-of-cheque-and-reasons-for-dishonouring-cheque/
• https://www.education.gov.ng/wp-content/uploads/2021/09/COMMERCE-SS-1-3.pdf

Instructional Materials

The teacher will teach this lesson with the aid of:

• Cheque booklets
• Teller
• ATM cards
• Whiteboard and markers

Rationale for the Lesson

This lesson enables pupils to understand the different types of cheques and their uses, which is important for managing personal and business finances. It also helps them to recognize why a cheque might not be honoured, thereby preventing potential financial issues.

Prerequisite/Previous Knowledge

Pupils should have prior knowledge of the definition of a cheque and the basic functions of commercial banks.

Lesson Content/Board Summary

FORMS OF CHEQUE

Definition of a Cheque

A cheque is a written, unconditional order addressed to a bank, signed by the drawer, ordering the bank to pay on demand a specified sum of money to a named person or the bearer.

Forms of Cheque

Cheques can take various forms depending on their status or conditions:

• Stale Cheque: A cheque that has been presented for payment after a specified period (usually six months) from its date of issue. Banks typically refuse to honour stale cheques.
• Post-dated Cheque: A cheque with a future date written on it. It cannot be cashed or deposited until the date written on the cheque arrives.
• Certified Cheque: A cheque that has been guaranteed by the bank to be good for the amount written on it. The bank marks it as “certified” or “accepted,” indicating that funds are reserved for its payment.
• Bounced Cheque: A cheque that the bank refuses to pay because the drawer’s account has insufficient funds to cover the amount. This is also known as a dishonoured cheque due to insufficient funds.
• Dishonoured Cheque: A cheque that the bank refuses to pay for various reasons, not just insufficient funds.

Crossed Cheques

A crossed cheque is a cheque with two parallel lines drawn across its face, usually with or without words like “and Co.” or “Account Payee Only.” The crossing indicates that the cheque cannot be cashed over the counter but must be paid into a bank account.

There are two main types of crossing:

• General Crossing: This involves drawing two parallel lines across the face of the cheque. It can be paid into any bank account. Words like “and Co.” or “not negotiable” may be added between the lines.
• Special Crossing: This involves drawing two parallel lines and writing the name of a specific bank between them. The cheque can only be paid into an account with the named bank.

Reasons for Dishonouring Cheques

A bank may refuse to pay a cheque for several reasons, including:

• Insufficient Funds: The drawer’s account does not have enough money to cover the cheque amount.
• Irregular Signature: The signature on the cheque does not match the specimen signature held by the bank.
• Alterations: Any unauthorized changes or alterations made on the cheque without proper authentication (e.g., initialing by the drawer).
• Post-dated Cheque: The cheque is presented for payment before its stated date.
• Stale Cheque: The cheque is presented after its validity period (usually six months).
• Countermanded Payment: The drawer has instructed the bank to stop payment on the cheque.
• Difference in Words and Figures: The amount written in words differs from the amount written in figures.
• Death or Bankruptcy of Drawer: The bank is informed of the drawer’s death or bankruptcy.
• Defective Cheque: The cheque is torn, mutilated, or improperly filled.

Teaching Methods/Instructional Techniques

Discussion, Lecture, Demonstration, Question and Answer, Visual Aids

Instructional Procedures

Step 1: Introduction

Time: 5 minutes
Teaching Skill: Set Induction
Teacher’s Activity: The teacher greets the pupils and reviews the previous lesson on the definition and types of banks. The teacher then asks pupils what they know about cheques.
Pupils’ Activity: Pupils respond to the teacher’s greetings and questions, recalling previous knowledge and sharing their understanding of cheques.
Learning Point: Pupils recall prior knowledge and are introduced to the lesson topic.

Step 2: Presentation of Forms of Cheque

Time: 10 minutes
Teaching Skill: Explanation/Discussion
Teacher’s Activity: The teacher introduces the various forms of cheques (stale, post-dated, certified, bounced, dishonoured) and explains each with practical examples using cheque booklets.
Pupils’ Activity: Pupils listen attentively, ask questions for clarification, and identify examples of different cheque forms.
Learning Point: Pupils understand and can define different forms of cheques.

Step 3: Discussion on Crossed Cheques

Time: 10 minutes
Teaching Skill: Demonstration/Explanation
Teacher’s Activity: The teacher explains the concept of crossed cheques, demonstrating general and special crossing on a sample cheque. The teacher also explains the reasons for crossing cheques.
Pupils’ Activity: Pupils observe the demonstration, ask questions, and take notes on general and special crossing.
Learning Point: Pupils understand what a crossed cheque is and the difference between general and special crossing.

Step 4: Reasons for Dishonour

Time: 10 minutes
Teaching Skill: Explanation/Lecture
Teacher’s Activity: The teacher explains in detail the various reasons why a bank might dishonour a cheque, such as insufficient funds, irregular signature, alterations, and post-dating.
Pupils’ Activity: Pupils listen, take notes, and ask questions about the reasons for dishonouring cheques.
Learning Point: Pupils identify and understand the reasons why cheques are dishonoured.

Step 5: Role Play/Practical Activity

Time: 5 minutes
Teaching Skill: Practical Demonstration
Teacher’s Activity: The teacher guides pupils in a brief role-play scenario involving cheque handling, such as issuing a post-dated cheque or receiving a stale cheque.
Pupils’ Activity: Pupils participate in the role-play, demonstrating their understanding of cheque handling.
Learning Point: Pupils apply their knowledge of cheque forms in a practical scenario.

Step 6: Class Activity/Discussion

Time: 3 minutes
Teaching Skill: Collaborative Learning
Teacher’s Activity: The teacher asks pupils to work in pairs and list any two reasons for a cheque being dishonoured.
Pupils’ Activity: Pupils discuss with their partners and list reasons for dishonouring cheques.
Learning Point: Pupils reinforce their understanding of reasons for cheque dishonour through peer collaboration.

Step 7: Evaluation/Review

Time: 5 minutes

Teaching Skill: Questioning/Assessment

Teacher’s Activity: The teacher evaluates the learning by asking the following questions:

1. Define a stale cheque and a post-dated cheque.
2. Explain the difference between general crossing and special crossing.
3. List three reasons why a bank may dishonour a cheque.
4. What is a certified cheque?

Pupils’ Activity: Pupils answer orally and in writing.

Learning Point: Pupils demonstrate understanding of the lesson.

Step 8: Conclusion

Time: 2 minutes
Teaching Skill: Summarization
Teacher’s Activity: The teacher summarizes the key points of the lesson, re-emphasizing the importance of understanding different cheque forms and proper cheque handling. The teacher assigns homework.
Pupils’ Activity: Pupils listen to the summary and copy down the homework assignment.
Learning Point: Pupils consolidate their learning and prepare for further study.

Lesson Keywords

• Stale Cheque – A cheque presented after its validity period.
• Post-dated Cheque – A cheque written with a future date.
• Certified Cheque – A cheque guaranteed by the bank.
• Bounced Cheque – A cheque returned due to insufficient funds.
• Dishonoured Cheque – A cheque refused by the bank for various reasons.
• General Crossing – Two parallel lines on a cheque, allowing payment into any bank account.
• Special Crossing – Crossing with a specific bank’s name, allowing payment only into an account with that bank.
• Insufficient Funds – Not enough money in the account to cover the cheque.
• Irregular Signature – Signature on the cheque does not match the bank’s record.

Differentiation

For pupils who grasp concepts quickly, the teacher can encourage them to research other types of cheques (e.g., open cheque, bearer cheque). For pupils who need more support, the teacher can provide simplified definitions and more visual aids, allowing them to draw examples of different crossings.

Note for teachers using this lesson plan

Ensure to have actual or sample cheque booklets to demonstrate the different forms and crossings effectively. Encourage active participation in the role-play to make the lesson more practical and engaging for the pupils.