Lesson Note on Quoted and Unquoted Companies: Meaning, Features and Differences for SSS 2

Class: Senior Secondary School 2 (SS2 / SSS2)
Term: 3rd Term
Week: 2
Age: 16 years
Duration: 45 minutes
Subject: Financial Accounting
Curriculum Theme: Financial Accounting Concepts
Previous Lesson: Company Account: Company Formation and Key Documents.
Topic: QUOTED AND UNQUOTED COMPANIES
Subject Matter: Meaning of quoted companies (companies listed on a stock exchange), quoted companies (definition, features, examples), meaning of unquoted companies (companies not listed on a stock exchange), unquoted companies (definition, features), distinction between quoted and unquoted companies

Specific Objectives

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

Cognitive Domain:

• Define quoted and unquoted companies.
• State the key features of quoted companies.
• Identify the key features of unquoted companies.
• Distinguish between quoted and unquoted companies.

Affective Domain:

• Appreciate the importance of understanding different types of companies in financial markets.
• Show interest in the operations of the stock exchange.

Psychomotor Domain:

• List examples of quoted companies in Nigeria.
• Prepare a list of unquoted companies in their locality.

Social Domain:

• Participate actively in class discussions on company types.
• Collaborate with peers to identify local companies.

Reference Materials

The following resources were used in planning this lesson:

• Senior Secondary Schools Education Curriculum
• State Unified Scheme of Work
• Oyebola, W. A. (2018). Financial Accounting for Senior Secondary Schools. University Press Plc.
• Charts, daily official list from NSC, books

Instructional Materials

The teacher will teach this lesson with the aid of:

• Charts showing examples of quoted and unquoted companies.
• Daily official list from the Nigerian Stock Exchange (NSE).
• Financial accounting textbooks.

Rationale for the Lesson

Understanding quoted and unquoted companies helps pupils to differentiate between various business structures. This knowledge is important for making informed decisions about investments and understanding the broader financial market landscape.

Prerequisite/Previous Knowledge

Pupils are expected to have a basic understanding of companies as business organizations and the concept of shares.

Lesson Content/Board Summary

QUOTED AND UNQUOTED COMPANIES

Meaning of Quoted Companies

Quoted companies are public limited companies whose shares are listed and traded on a stock exchange. Their shares can be bought and sold by the general public through brokers.

The following are features of quoted companies:

• Their shares are listed and traded on a stock exchange.
• They are generally larger in size and have a higher public profile.
• They are subject to strict regulatory requirements and disclosure rules.
• Their shares are easily transferable and have readily available market prices.
• They have a large number of shareholders.

Meaning of Unquoted Companies

Unquoted companies are companies whose shares are not listed or traded on a stock exchange. Their shares are typically held privately and are not available for public trading.

The following are features of unquoted companies:

• Their shares are not listed on any stock exchange.
• They are often smaller in size compared to quoted companies.
• They are subject to fewer regulatory requirements than quoted companies.
• Their shares are not easily transferable and finding buyers can be difficult.
• They typically have a smaller number of shareholders, often family members or a small group of investors.

Distinction Between Quoted and Unquoted Companies

The main differences between quoted and unquoted companies are:

• Listing: Quoted companies are listed on a stock exchange, while unquoted companies are not.
• Share Trading: Shares of quoted companies are publicly traded, making them easily bought and sold. Shares of unquoted companies are privately traded, making them less liquid.
• Regulation: Quoted companies face stricter regulatory oversight and disclosure requirements compared to unquoted companies.
• Access to Capital: Quoted companies can raise capital easily from the public through share issuance. Unquoted companies rely on private sources like banks, venture capitalists, or existing shareholders.
• Visibility: Quoted companies have higher public visibility and brand recognition due to their public status. Unquoted companies generally have lower public profiles.
• Valuation: The market value of quoted companies’ shares is readily available from stock exchange listings. Valuing unquoted companies’ shares can be complex.

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 asks them if they know any companies whose shares can be bought by anyone from the public.
Pupils’ Activity: Pupils respond by mentioning companies they know, like banks or large consumer goods companies.
Learning Point: Pupils are introduced to the concept of public shareholding.

Step 2: Explanation of Quoted Companies

Time: 10 minutes
Teaching Skill: Explanation
Teacher’s Activity: The teacher explains the meaning of quoted companies, their features, and provides examples of companies listed on the Nigerian Stock Exchange.
Pupils’ Activity: Pupils listen attentively, take notes, and ask questions for clarification.
Learning Point: Pupils understand what quoted companies are and their characteristics.

Step 3: Explanation of Unquoted Companies

Time: 10 minutes
Teaching Skill: Explanation
Teacher’s Activity: The teacher explains the meaning of unquoted companies, their features, and gives examples of privately-owned businesses or smaller companies not listed on the stock exchange.
Pupils’ Activity: Pupils listen and note down the definitions and features of unquoted companies.
Learning Point: Pupils understand what unquoted companies are and their characteristics.

Step 4: Distinguishing between Quoted and Unquoted Companies

Time: 10 minutes
Teaching Skill: Comparative Analysis
Teacher’s Activity: The teacher leads a discussion on the key differences between quoted and unquoted companies, emphasizing areas like listing, trading, and regulation.
Pupils’ Activity: Pupils actively participate by stating differences and contributing to the discussion.
Learning Point: Pupils can differentiate between the two types of companies based on various criteria.

Step 5: Examples of Quoted Companies

Time: 5 minutes
Teaching Skill: Illustration
Teacher’s Activity: The teacher guides pupils to name more examples of quoted companies in Nigeria using the daily official list or their general knowledge.
Pupils’ Activity: Pupils list various Nigerian companies that are publicly traded.
Learning Point: Pupils identify real-world examples of quoted companies.

Step 6: Examples of Unquoted Companies

Time: 5 minutes
Teaching Skill: Application
Teacher’s Activity: The teacher asks pupils to think of and list examples of unquoted companies, possibly local businesses or family-owned enterprises in their community.
Pupils’ Activity: Pupils contribute examples of unquoted companies they know.
Learning Point: Pupils identify real-world examples of unquoted companies.

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 quoted company.
2. State two features of an unquoted company.
3. Mention two differences between quoted and unquoted companies.
4. Give an example of a quoted company and an unquoted company in Nigeria.

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 main points of the lesson, reiterating the definitions and distinctions between quoted and unquoted companies. The teacher then gives an assignment.
Pupils’ Activity: Pupils listen to the summary and copy the assignment.
Learning Point: Pupils consolidate their understanding of the topic.

Lesson Keywords

• Quoted Company – A company whose shares are listed and traded on a stock exchange.
• Unquoted Company – A company whose shares are not listed or traded on a stock exchange.
• Stock Exchange – A market where securities (like shares) are bought and sold.
• Shares – Units of ownership in a company.

Differentiation

For pupils who grasp concepts quickly, the teacher can challenge them to research the advantages and disadvantages of being a quoted company versus an unquoted company. For pupils needing more support, the teacher can provide simplified charts or visual aids highlighting the key distinctions, and offer more direct examples.

Note for teachers using this lesson plan

Ensure to use current examples of companies listed on the Nigerian Stock Exchange to make the lesson relatable. Encourage pupils to look up local businesses as examples of unquoted companies. Emphasize the practical implications of a company being quoted or unquoted for investors and the company itself.