Entrepreneurial Thinking Level 3

Who it is for. Owners and would-be owners in any trade (food, tailoring, repair, farming, building, beauty, trading, services) who have finished Entrepreneurial Thinking Level 2, or can show the same skills, and who already have, or have tested, a business that makes money. Ghana's TVET framework has eight levels, and National Proficiency II sits below National Certificate I. This module is written at an advanced level, comparable to National Certificate I. That comparison is the author's judgement, not a CTVET ruling. No accreditation is claimed.

Bridge from Level 2: what you already know

Level 2 gave you proof and a first plan. Level 3 goes deeper on the same threads: your first routine becomes a set of standard operating procedures; your helper becomes a team; your funding table becomes a financing plan; your business name becomes a possible company; and your one-page plan becomes a full plan with a 12-month cash-flow forecast. Basic books, cash flow and loans were taught in Money Skills for Small Business Level 2; this manual goes further for a growing, registered business and does not copy them.

How the module works

Each unit has learning outcomes, performance criteria, the range and the evidence your assessor needs. You are judged Competent or Not Yet Competent. About 60% of the time is practical; CTVET's Oil Palm programme uses about 30% school and 70% workplace.

Competency standard

Range. A business that has paying customers; one to ten workers or apprentices; any trade. Evidence. Time-and-bottleneck sheet; two SOPs; delegation plan; hire cost sheet and contract; leadership role-play.

The bottleneck: what limits growth?

Every business has one step that limits how much it can sell. A bakery may have enough customers but only one oven. A tailor may have orders but only one pair of hands for finishing. A phone repairer may have a long queue for screen replacements because only the owner can do the micro-work. Growing the other steps does not help until you fix the limiting step. This idea is the author's teaching summary of a common operations rule, not a Ghana statistic.

Cash strain is a key danger at the growth stage, and owners must decide whether to keep their current strategy, sell, or merge to keep growing. Always check the cash side of a fix (Unit 6) before you buy capacity.

Standard operating procedures (SOPs)

An SOP is a written, numbered method for a task that repeats, with the standard to meet. Level 2 asked for one routine. At Level 3 the aim is that the business can be run by someone else for a week.

A good SOP has:

Checklists are shorter than SOPs: tick boxes for opening, closing, handover at a shift change and weekly stock checks. Pilots and surgeons use them because people forget under pressure; that is the author's note, not a cited claim. Start with five SOPs for the tasks where mistakes cost the most money or lose customers: serving or doing the job, quality check, cash handling, stock ordering, and complaints.

Test every SOP on a stranger. If a new helper cannot follow it, the SOP is wrong, not the helper.

Delegation

To delegate is to give someone else the job and the authority to do it, while you stay responsible for the result. Use five levels, from tight control to trust. This ladder is the author's teaching tool:

Never delegate what only you can do and what carries legal risk without understanding: signing for loans, the final say on pay, tax filings you cannot read, and safety rules. Delegate money only with limits: a float, a written spending limit and a receipt for everything. Put the limit in writing.

Delegation steps: (1) pick the task and the person; (2) explain the result you want, not only the steps; (3) hand over the SOP, tools and authority; (4) agree a check date; (5) give feedback; (6) step back. If the same task returns to you, the delegation failed. Find out whether the SOP, the training or the person was the problem.

Hire and manage a team

Hiring is a money decision before it is a people decision. First cost the hire. A hire pays for itself only if the extra work they allow earns more than they cost.

What a hire really costs (Ghana, example). Pay is not the only cost. For employees on payroll:

Hiring steps:

1. Write the role: tasks, hours, pay, place, who the person reports to, and what a good month looks like (Level 2 job description).
2. Advertise by WhatsApp status, signage, a trade association, the hub's notice board and word of mouth. Ask for references.
3. Test, do not just talk: give a short paid trial task. Watch how they work.
4. Offer in writing: contract with pay, hours, notice, probation period, leave, and the pay date.
5. Register for SSNIT and PAYE as soon as the person is on payroll.
6. Induct: day one is a tour, the safety rules, the SOPs, who to ask and what the quality standard is. Give the person a buddy for the first week.
7. Review at 30, 60 and 90 days: three questions: what is going well, what is not, what do you need from me?

Apprentices. Many Ghanaian trades train apprentices. Treat an apprentice as a learner with rights: a clear agreement on length, what they will learn, any pay or allowance, working hours, safety, and a certificate or reference at the end. The 2026 Budget lists GH¢170 million for a National Apprenticeship Programme. Ask GEA or the Assembly whether a placement scheme is open before you hire; whether any current scheme pays a stipend to the employer is not verified.

Safety and fairness. The employer must provide safe conditions and personal protective equipment at no cost to the worker. Do not hire children for hazardous work. Pregnant workers have special protection (s.55, s.57). Keep each worker's signed contract, SSNIT number, leave record and pay slips (see record keeping in Unit 6).

Lead people

A leader sets direction, builds skills and keeps standards. You do not need to be loud. You need to be clear, fair and consistent.

Training in personal initiative raised small-business profits by 30% in Togo, compared with 11% for standard business training. Ask your staff for ideas and act on a few; owners who encourage initiative in the team gain from it. The study measured owners, not employees, so treat this as a hint, not a promise.

Competency standard

Range. The team's business; one real or realistic contract; one bulk order or tender. Evidence. Strategy sheet; pricing and care plan; digital plan; partner comparison; contract draft and negotiation role-play; bid checklist and price.

Strategy: pick a route, then check the cash

Level 2 asked for your positioning sentence. A strategy is a short set of choices: who your customers are, what you sell them, how you are different, and how you will grow. Growth options include: improving the product, new products, getting more of the existing market (market penetration), new ways to reach customers, new markets, and, riskier, licensing, mergers, joint ventures and strategic alliances.

Pick one route at a time. Write why; write the risk; write the cash it needs (Unit 3 and Unit 6); write what you will stop doing. A business that chases five routes grows none.

Three simple stances (author's teaching tool).

Use the Value Proposition Canvas again: jobs, pains, gains, then check that your product, pain-relievers and gain-creators fit. Update the nine blocks of your canvas with growth in mind.

Test a strategy before betting on it. Level 1 and 2 taught the cheap test: pre-sell, count, decide. Use the same method for a new route. The Blue Skies founder, refused by banks, funded growth with friends, investors and a mortgage and grew a fresh-fruit processing business from three people to nearly 10,000 staff; that route needed many steps, tests and partners over time.

Pricing and customer care for growth

Level 2 taught payback. Now apply three pricing ideas (author's teaching summary):

• Cost-plus: cost + a margin you need. This sets a floor.
• Value-based: what the job is worth to the customer. A reliable plumber who comes within the hour can charge more than a stranger.
• Packages and tiers: basic, standard and premium. Many customers choose the middle option; show it as "most popular" only if that is true.

Do not cut prices to win bulk orders unless the extra volume covers your costs (see contribution in Unit 6). Never go below your cost per item (Level 2).

Customer care system. A written promise ("repairs ready the same day or free"), a complaints SOP, a record of every complaint and the fix, and a follow-up call or message. Track three numbers each month: repeat customers, complaints and fixes within 24 hours. Word of mouth is trusted more than online recommendations among young Ghanaians, so a single unsolved complaint can cost many future customers.

Digital strategy

Digital tools are cheap ways to be found, to take orders and to collect money. Decide what each tool is for:

Measure it. Each month note: messages received, orders from them, repeat customers, cost of any adverts. Cost to win a customer = advertising spend ÷ new customers (Level 2). Stop what does not pay. Protect customers' data. If you keep names, phone numbers or photos of customers, Ghana's Data Protection Act, 2012 (Act 843) applies; the Data Protection Commission says entities processing personal data must register. The sources disagree about exactly who must register and the penalty figures, so ask the Commission, and see Unit 5.

Partnerships and cooperatives

In Ghana a registered partnership under the Incorporated Private Partnerships Act 1962 (Act 152) is for two to 20 partners according to the ORC page. Level 2 quoted two to 21 from a law-firm summary; use the ORC figure and confirm with the Registrar. Cooperatives are not registered at ORC; GRA gives an organisational TIN, and the Department of Co-operatives route was not verified. One court case under the Co-operative Societies Decree of 1968 reads the Act as needing an application signed by at least ten qualified members, but that comes from a case summary and the current law was not verified. For comparison, Kenya's Co-operative Societies Act says a primary co-operative needs at least ten qualified members, and at least ten must sign the application. That is Kenya's law; Ghana's may differ. Ask the Department of Co-operatives or the Assembly before you form one. Savings groups such as VSLAs show that groups work when rules are written and kept.

Before you partner, check the other side: how long have they traded; do they pay on time; can you visit; do they have a record? Get a written summary of what each side will do.

Contracts

A contract is an agreement that the law will enforce. Many problems come from agreements that were only spoken. In Ghana, arbitration agreements must be in writing under the Alternative Dispute Resolution Act, 2010 (Act 798), according to a commentary on the Act, which was not read in full. This manual does not teach contract law. It teaches you to write a clear simple agreement and to know when to call a lawyer.

Clauses to include (checklist for any supply, service or work contract):

Red flags: no deposit on a large custom job; payment "after the customer sells"; vague words such as "good quality" with no standard; a clause that lets only one side cancel; pressure to sign today; a document in a language you cannot read. Never sign something you do not understand. For large or long contracts, pay for a lawyer's review.

Debt collection. Include in the contract a late-payment date and what you will do (stop supply, charge interest as agreed). Keep proof of delivery. Chase politely and early; keep a debtors list (Unit 6).

Negotiation at an advanced level

Level 2 taught: the price you want, a price you will accept, and your walk-away point. At Level 3 add:

Tenders and bulk orders

Schools, churches, hospitals, companies and government agencies buy in bulk by quotation or tender. Public tenders in Ghana are governed by the Public Procurement Act, 2003 (Act 663) as amended by Act 914 of 2016. One summary says suppliers must register on the Public Procurement Authority's database to be eligible; a University of Ghana page lists the documents it asks suppliers for, including a company registration certificate, tax clearance, VAT registration, an SSNIT contribution certificate and a PPA certificate. That university list is one institution's requirement, not the whole law, and small-business rules or thresholds were not verified; ask the Public Procurement Authority.

To bid, prepare: registration papers; tax clearance if asked; references and photos of past work; a price list built from real costs; a delivery plan; the capacity to deliver (Unit 1); and the cash to buy materials before you are paid. Many bids are lost for missing a paper or a date. Bulk buyers often pay late. Never take a bulk job you cannot fund.

Competency standard

Range. The team's business; real or realistic figures. Evidence. 12-month cash-flow forecast; finance comparison; loan and equity calculations; readiness file; pitch observation.

This unit goes beyond Money Skills for Small Business Level 2, which taught the true cost of a loan (APR), rights as a borrower, licensed lenders, scams, savings groups and a two-page proposal. Read those first.

Plan money first: the 12-month cash-flow forecast

A cash-flow forecast lists the cash you expect to receive and pay each month, and the cash balance at the end of each month. A business can be profitable and still run out of cash, because customers pay late, stock is bought before it is sold, or loan repayments are due. Lenders and investors ask for the forecast because it shows when money is needed, how much, and whether it can be repaid.

Build it in six steps:

1. Opening cash: what you have in cash, MoMo and bank on day one.
2. Sales by month: from your records, your pre-sales and your plan. Keep a "low" and a "likely" version. Do not forecast a jump you cannot explain.
3. Cash in: cash sales, customers' payments of earlier credit (delay by the days your customers take to pay), loans and grants received, owner's money put in.
4. Cash out: materials (a percentage of sales), packaging and transport, wages, rent, power, phone, permits and licences, loan repayments, tax set aside, equipment bought, owner's drawings.
5. Net cash and closing cash each month: closing = opening + in − out. Next month's opening is this month's closing.
6. Stress test: cut sales by 20% and delay customer payments by one month. Check the lowest cash balance and the month it happens.

A full 12-month example (all numbers are examples). A bakery starts with GH¢5,000 in cash. It takes a loan of GH¢15,000 in month 1 and spends all of it on an oven and a mixer in month 1 (no net effect on cash). It repays GH¢700 a month from month 2. Customers pay cash. Ingredients cost 40% of sales, packaging and transport 5%, and tax is set aside at 3% of sales (the Modified Taxation rate for turnover of GH¢20,001–750,000; see Unit 6 for the rule). Wages are GH¢1,800 a month until month 6 and GH¢2,600 from month 7 when a second baker joins. Rent, power, phone and other fixed costs are GH¢1,500 a month. The owner draws GH¢1,200 a month.

Worked line, month 1: cash out = ingredients 4,800 + packaging and transport 600 + tax set-aside 360 + wages 1,800 + fixed 1,500 + loan repayment 0 + drawings 1,200 = GH¢10,260. Net = 12,000 − 10,260 = GH¢1,740; closing = 5,000 + 1,740 = GH¢6,740.

What the lender reads in it: the lowest closing cash (here GH¢6,740 at the end of month 1, always positive); the monthly repayment is covered from the net cash with a cushion; the extra baker in month 7 is paid for by the growth in sales; and the stress test still works (see the exercise).

Break-even from the forecast. Contribution (sales left after the costs that rise with sales) is 52% of sales here (100 − 40 − 5 − 3). Months 2–6 have fixed money out of GH¢5,200 (wages 1,800 + fixed 1,500 + loan 700 + drawings 1,200); break-even sales = 5,200 ÷ 0.52 = GH¢10,000 a month. From month 7 fixed money out is GH¢6,000, break-even sales = 6,000 ÷ 0.52 = about GH¢11,539. The business sells above that every month, which is why cash grows.

The finance menu at a glance

Level 2 gave a first table. Add cost and what the lender or giver wants:

2026 public programmes. The 2026 Budget names GH¢401 million for a Women's Development Bank, GH¢170 million for the National Apprenticeship Programme, GH¢160 million for Adwumawura, and GH¢110 million for the 24-Hour Economy programme. The budget says VAT and income tax reforms should cut business costs by about 6%. The rules, forms and open dates of these programmes were not verified. Ask GEA and your Assembly.

NEIP and earlier soft-loan windows. An earlier Presidential Business Support window offered loans of GH¢5,000 to GH¢50,000 at 10% interest to young entrepreneurs under 35; whether a round is open now is not verified.

Persons with disabilities. The GEA PWD Enterprise Support Programme gives grants to businesses owned by persons with disabilities, and a 2023 round offered grants for 150 such businesses through an online portal with training. The District Assemblies' disability fund rose from 3% to 5% in 2026, with the allocation going from GH¢225.3 million to GH¢438.5 million; it aims at assistive devices, skills training and start-up capital, and direct cash is limited to verified needs. That fund is not a general business loan. Ask your Assembly's disability desk what a small enterprise must show.

Loans: the real cost

Level 2 introduced the annual percentage rate (APR), which turns all loan costs into one yearly rate so that offers can be compared. Here is why it matters.

A GH¢50,000 loan for 24 months at 24% a year (example).

• Reducing-balance loan: interest is charged each month on what you still owe. At 2% a month the equal monthly payment is about GH¢2,643.55. Over 24 months you repay about GH¢63,445 and the interest is about GH¢13,445.
• Flat-rate loan: interest is charged on the full GH¢50,000 for the whole time: 24% × 2 years = GH¢24,000 interest, total GH¢74,000, payment GH¢3,083.33 a month. Because you owe less each month but still pay interest on the full amount, the real yearly cost is much higher: about 3.4% a month, roughly 41% a year (approximate; use a calculator or the lender's APR).

Always ask: "Is this a flat or a reducing-balance rate? What is the APR? What fees come on top (processing, insurance, penalties)?" Check that the lender is licensed and know your rights as a borrower (see Money Skills Level 2).

Debt service cover. Lenders check whether your cash can pay the loan. Debt service cover ratio (DSCR) = yearly cash available to pay debt ÷ yearly loan payments. Using the loan above: payments 2,643.55 × 12 = GH¢31,722.60 a year. If the business has GH¢60,000 a year available, DSCR = 60,000 ÷ 31,722.60 = 1.89. A ratio below 1 means the business cannot pay from its cash. What ratio a Ghana lender wants was not verified. As an international guide, the Corporate Finance Institute says lenders typically want a DSCR of at least 1.25, and many prefer about 2. Ask each lender for its own figure.

Equity: selling a share of the business

An investor gives you money for a share of ownership. The investor is paid only if the business does well, usually when it is sold or pays dividends later. Equity costs no repayments, but it gives away part of your future profit and part of your control.

Pre-money and post-money value (example). An investor puts GH¢100,000 into your business for 20% of it. The business is then valued at 100,000 ÷ 0.20 = GH¢500,000 post-money (after the money goes in). Before the money, the pre-money value was 500,000 − 100,000 = GH¢400,000. You owned 100% and now own 80%, which is 80% of GH¢500,000 = GH¢400,000. Your share went down but the pie grew: it is a good deal only if the money lets the business grow more than the share you gave up.

Founders' agreement. If there are co-founders, agree in writing how shares are divided, what happens if someone leaves before a sale, and what happens at the next round of funding. A buy-back clause says how a leaving partner is paid.

Term sheet and company law. An investment usually starts with a summary of terms (a term sheet). A UK legal guide says a term sheet sets out the main terms of the deal: how much the investor pays and when; the valuation (pre-money and post-money); the type of shares (ordinary or preference); who sits on the board; protection for the investor if you later sell shares at a lower price (anti-dilution); whether founders earn their shares over time (vesting); and whether you must talk only to this investor for a time (exclusivity). Most of a term sheet is usually not legally binding, but clauses such as confidentiality and exclusivity usually are. That guide is written for the UK. Ghana's rules on share issue were not verified. Use a lawyer before you sign, and a chartered accountant to check the valuation.

Investor readiness: the file a lender or investor will ask for

Before you ask for money, prepare a "readiness file". Due diligence means taking reasonable steps to check that decisions are based on researched, accurate information. An investor or lender will do it; you should do it first.

The pitch for a lender or investor

An investor pitch usually runs 10 to 20 minutes with a specific amount asked for, and the deck is often sent before the meeting. A short elevator pitch of about three sentences covers the problem and solution, the value you offer, proof that customers want it, and the team. Investors pay close attention to competitors you leave out and to your barriers to entry.

Ten-slide order (author's template):

1. Title and one line on what you do.
2. Problem (in your customers' words from Level 2).
3. Solution and how it is different.
4. Proof: sales, pre-sales, repeat customers, testimonials.
5. Market and competitors: size, gap, what stops others copying you.
6. Business model: how you make money; numbers per customer.
7. Team and key people.
8. Plan and numbers: 12-month forecast highlights and break-even.
9. The ask: how much, in what form (loan, equity), what it buys, what you offer back.
10. Risks and how you handle them, then your contact.

Questions you must be ready for: What happens if sales are 20% lower? Who are your biggest customers and what if one leaves? What do you do that someone with more money could not copy? How will you repay? What if you are ill? What is your exit?

Rules: never invent a number; say "I do not know yet, I will find out" when true; bring paper copies; thank the panel; follow up within 48 hours.

Competency standard

Range. The team's business; real or realistic assets and risks. Evidence. IP protection plan; code of conduct and decision-rights table; risk register; insurance questions; social enterprise comparison.

Intellectual property (IP): what you own

Your business owns more than things: its name, logo, recipes and methods, designs and photos, customer list and know-how. Level 2 introduced copyright and trademark; at Level 3 you plan the protection.

Practical steps:

Internationally, WIPO says patent protection is generally granted for 20 years from the filing date. Ghana's own rules and fees for patents and industrial designs were not verified in this manual; ask the Registrar-General's Department.

Ethics and a code of conduct

Level 2 listed honest choices. At Level 3 you write them down and train your team in them. A code of conduct is a one-page set of rules everybody signs, covering:

Ethics is practical: customers and lenders trust honest firms, and your name travels by word of mouth.

Governance: who decides what

Governance is the set of rules for who decides, who checks and who is accountable. Even a three-person business needs it once money, staff and partners are involved.

Decision-rights table (example). For each decision write who proposes, who decides, who must be told:

(All amounts in the table are examples.)

Controls that prevent theft and mistakes (author's practice):

A company's duties. A company limited by shares is governed by the Companies Act, 2019 (Act 992). Commentary on Act 992 says it has a general duty for directors to act in the company's interests and to consider the long-term results of decisions, the effect on the community and environment, and the company's reputation for ethical conduct (reported as section 190). The ORC also asks for beneficial-owner information, and annual returns must be filed each year, first after 18 months. Insolvency is mainly governed by the Corporate Insolvency and Restructuring Act, 2020 (Act 1015), and commentary says directors can be personally liable and criminally sanctioned if they keep incurring debts when they knew or should have known the company was insolvent. Section numbers and penalties were not read in full; ask a lawyer. In short: a company is a separate person, but the people who run it are not free from duties.

A board of advisers. A small business can invite two or three trusted outsiders (an accountant, an older trader, a banker) to meet quarterly and challenge your plans. It is not a legal board; it is a habit that helps you see blind spots.

Risk: find it, rank it, control it

A risk register is a table of what could go wrong. Rank each risk by likelihood (1–5) and impact (1–5); multiply for a score from 1 to 25. This scoring method is the author's teaching tool.

(Ratings are examples. Rate your own.) For each high score choose one of four responses: avoid it, reduce it, transfer it (insurance, contract), or accept it and keep a reserve. Review the register every quarter. Keep every safety gate from your trade and from Workplace Safety, including the rule that fire certificates and fire equipment follow the Ghana National Fire Service's requirements.

Insurance. Insurance transfers part of a risk to an insurer for a premium. Possible covers include fire and property, stock, theft, vehicles, goods in transit, workers' injuries, public liability, and health or life cover for the owner. Which covers are compulsory in Ghana for a business like yours was not verified. For comparison only: in the UK every employer must hold employers' liability insurance of at least £5 million, and can be fined £2,500 for each day without it. That is UK law, not Ghana law; ask the National Insurance Commission what applies to you. Rules for what you must do:

Owner's pension and benefits. SSNIT advises informal-sector workers to join pension schemes, and the National Pensions Regulatory Authority urges informal workers to prioritise the Tier-Three scheme. Ask SSNIT and the Authority what applies to you.

Social enterprise: profit and purpose

A social enterprise is a business whose main goal is a social or environmental result (for example jobs for disabled people, clean water, training for young people) and which earns most of its income by selling goods or services rather than relying only on donations. This is the author's definition. Choose carefully:

The fees above are from the ORC pages read on 7 October 2026. Social enterprises still need honest books, impact measures (for example "number of trainees employed") and a way to pay staff fairly.

Competency standard

Range. A business in Sekondi-Takoradi or nearby; any trade. Evidence. Form comparison; registration checklist with fees; tax and licence list; start-up budget; one-page business plan; accessibility note.

Step 1 · Choose the legal form

Late annual returns are charged GH¢1,000 for 1 to 4 years late and GH¢2,000 for 5 or more years late. A fee of GH¢1,885 for an optional VIP service for company registration was shown on the company page.

How to choose (author's questions):

Step 2 · Register at the Office of the Registrar of Companies

A. Business name (sole proprietor). Search that the name is free; complete the business-name form; present your Ghana Card; pay GH¢130; receive the certificate. Renew yearly at GH¢70. Registering a name does not itself give you the exclusive brand rights of a trademark (Unit 4).

B. Partnership. Draw up a partnership agreement (who puts in what, who does what, profit sharing, how a partner leaves). Complete Form B. The agreement is stamped at the Lands Commission (Valuation Division). Pay GH¢270. Renew at GH¢100 a year. The law is the Incorporated Private Partnerships Act 1962 (Act 152).

C. Company limited by shares. From the ORC page read on 7 October 2026:

1. Check that the name is available and reserve it.
2. Complete the Company Registration Form (Form 3C).
3. Get a consent letter from an auditor: a chartered accountant licensed with the Institute of Chartered Accountants, Ghana (ICAG). The page says auditors serve up to six years and are then rotated.
4. Statutory declarations for the directors, witnessed by a Commissioner for Oaths or a Notary Public (the page also mentions self-declaration; ask the counter which applies to you).
5. Stated capital: fill in the share structure and who owns which shares.
6. Directors and secretary: at least two directors; each submits a statutory declaration and a consent letter; the company secretary submits a consent letter.
7. Beneficial owners: give information on the people who ultimately own or control the company.
8. Submit the forms at the Company Registration Counter (Monday to Friday, 9:00 am to 4:00 pm).
9. Pay the filing fee of GH¢585 at the in-house bank (plus capital duty if it applies).
10. Receive the certificate of incorporation, certified copies of the constitution and Form 3C, and the beneficial-owner profiles once the Registrar approves.
11. File annual returns with financial statements at GH¢175, the first after 18 months and then yearly.

Processing time was not stated on the page. The facts sheet for this series quotes a capital duty of 1% of stated capital from the ORC fees page; the company page itself did not mention it when read, so confirm the capital duty before you plan your budget.

D. Company limited by guarantee (NGO, church, social enterprise): GH¢490 plus the same style of steps with a guarantee instead of shares.

Write a shareholders' agreement if there is more than one owner: who owns what share, who decides what, what happens if one wants out or dies, how profit is paid, what happens in a dispute. Use a lawyer.

Step 3 · Tax identity and tax route

Step 4 · Permits and licences that may apply

Include in your folder a copy of every certificate, receipt and renewal date. Records must be kept in Ghana for at least six years from the end of the year of assessment or VAT period, and longer if there is a dispute. Set phone reminders for renewal dates: ORC yearly, permit by 31 March, SSNIT by the 14th, PAYE and withholding tax by the 15th, VAT by the last working day, provisional tax each quarter (see Unit 6).

Step 5 · Premises, location and equipment

Level 2 gave the location rules. At Level 3 you prove the site with numbers.

Start-up budget (example, phone repair shop).

Funding: savings GH¢6,000 and a susu payout of GH¢2,000 leave a gap of GH¢4,645, to be met from a loan, a grant or a cheaper plan. (All items except the ORC fee are examples. The ORC fee is from the official page; capital duty, if any, is not included.)

Step 6 · Money for the start

Review the finance menu in Unit 3. For a first company, banks and microfinance lenders often ask for: your registration documents, TIN, six to twelve months of records, a forecast, and sometimes security. Programmes such as GEA's SME GO and Business-in-a-Box, and the Business Advisory Centres in Takoradi, Shama, Effia-Kwesimintsim, Mpohor and Ahanta West, can help with plans and training. The 2026 Budget names funds for the Women's Development Bank, the National Apprenticeship Programme, Adwumawura and the 24-Hour Economy programme; rules and open dates were not verified.

Step 7 · The one-page business plan

Use the nine headings from Level 2 and add two: the 12-month cash-flow forecast and the registration and permit status. The full plan for the capstone is in Unit 7.

Step 8 · People, insurance and safety

Step 9 · Market yourself properly

Register the business name on your signboard, WhatsApp Business profile and Google Business Profile with the same name, phone, address and opening hours. Show your certificate or permit number if your customers care about legitimacy (food and cosmetics buyers do). Build a portfolio of finished work with permission, collect reviews, keep a referral habit (Level 2) and track which channel brings paying customers.

Accessibility

Ghana's Persons with Disability Act, 2006 (Act 715) is reported to give employers a tax rebate for hiring persons with disabilities and to require working tools, though not always put into practice. GEA has a programme for businesses owned by persons with disabilities, and the Assemblies' disability fund rose to 5% in 2026. Suggestions below are the author's:

Competency standard

Range. The team's business, real or realistic figures; spreadsheet or exercise book. Evidence. A month of source documents; cash book; ledger and trial balance; P&L and balance sheet; costing and break-even sheet; reconciliation; month-end checklist.

This unit builds on Money Skills for Small Business Level 2, which taught the cash book, profit and loss, a balance sheet and stock records for a small trader. Here you complete the cycle used by a registered business and you add trade-specific costing and tax records. All figures are examples unless a source is named.

The accounting cycle in one picture

1. Source documents: receipts, invoices, delivery notes, MoMo and bank messages.
2. Record each in the cash book (and the sales, purchase and stock records).
3. Post to the ledger accounts (double entry).
4. Trial balance: check debits equal credits.
5. Adjust: stock, depreciation, amounts owed and owing.
6. Statements: profit and loss and balance sheet.
7. Review and plan: compare with the forecast; decide.

Source documents: receipts, invoices and petty cash

• Receipt: proof that you received money. Number it, date it, name the customer and the item, show the amount, and sign. Keep the carbon or photo.
• Invoice: a request for payment for goods or services supplied on credit. It shows the due date. For VAT-registered businesses, invoices are e-VAT invoices that can be verified by QR code.
• Delivery note and purchase order: show what was ordered and received, so you pay only for what you received.
• Petty cash: a small cash float for small expenses, kept apart from sales cash, using the imprest system: a fixed float (for example GH¢200). Every payment has a signed voucher. At the end of the week, vouchers plus cash left must equal the float. Top up the exact amount spent.

The cash book

The cash book records every receipt and payment (cash, MoMo and bank) in date order, with a running balance. It is the most important record in a small business. A sample page for a small phone-repair shop follows (all figures are examples). Cash, MoMo and bank are treated as one "cash and MoMo" balance to keep it short; in real life keep a column for each.

Check: opening 1,200 + receipts 4,160 − payments 2,790 = 2,570. The last balance on the page equals the total.

Rules: write every entry the same day; never leave gaps; never rub out (strike through and write again); keep the receipt number in the detail; count the real cash and check the MoMo balance on your phone at day end and at month end, and write the difference if any.

Stock records

Keep a stock card for each item: date, in, out, balance. Count the stock monthly. The cost of goods sold (COGS) for a month = opening stock + purchases − closing stock.

In the example, parts stock at the start was GH¢300; purchases in October were 650 + 420 = GH¢1,070; the stock count at 31 October was GH¢380. So COGS = 300 + 1,070 − 380 = GH¢990. Count stock at cost price, not selling price. Remove damaged or expired stock from the count and write it off as a loss. For food, use first-in first-out (the oldest stock goes out first).

Debtors and creditors

• Debtors are customers who owe you. Keep a list with the date of the invoice, amount and due date. Ageing groups debts by how old they are.
• Creditors are suppliers and others you owe. Keep a list with due dates so you pay on time and use any credit time you are allowed.

Ageing example. Invoices owed: A GH¢300 (10 days old), B GH¢500 (40 days), C GH¢250 (70 days), D GH¢150 (100 days). Total GH¢1,200. In groups: 0–30 days GH¢300; 31–60 days GH¢500; 61–90 days GH¢250; over 90 days GH¢150. The share over 60 days is (250 + 150) ÷ 1,200 = 33.3%. Chase the oldest first, and stop credit to customers who are over 60 days until they pay.

In October, the shop made one credit sale of GH¢200 on 29 October. It is not in the cash book (no cash moved), but it belongs in October's sales and on the debtors list.

The ledger and double entry

A ledger has one page, or account, for each type of item: cash, sales, rent, stock, debtors, capital and so on. Double entry records each transaction twice, as a debit in one account and a credit in another, so that assets = liabilities + equity always holds. The rules:

Example entries (October):

The trial balance: a check, not a guarantee

A trial balance lists every ledger balance, debits on one side, credits on the other. If the books are right, the two totals are equal. Equal totals do not prove everything is right: an entry in the wrong account, or one posted twice on both sides, still balances. A trial balance is a partial check.

Trial balance at 31 October (example, after adjustments).

If the totals do not agree: re-add; look for a transposed number (for example 540 written 450: the difference is divisible by 9); look for a one-sided entry; check that each cash book total was posted.

The income statement (profit and loss)

The income statement shows sales less costs for a period, giving profit. From the trial balance:

Owner's drawings (GH¢350) are not an expense: they are money taken out of the business by the owner. Collecting the old debt of GH¢150 is not October's sales: that sale was counted when it was made. Also pay yourself a fair wage as a cost, otherwise the profit looks bigger than the real picture.

The balance sheet

The balance sheet lists what the business owns (assets), what it owes (liabilities) and the owner's stake (equity) on one date.

Assets 6,100 = liabilities 0 + equity 6,100. At 1 October the position was: cash 1,200 + debtors 150 + stock 300 + tools 3,000 = 4,650, all owned by the owner.

(To keep the page short this example ignores SSNIT and PAYE on the helper's pay and VAT. A real business with staff needs them: see the exercises.)

Profit is not cash

Net profit was GH¢1,800 but cash rose only GH¢1,370 (from 1,200 to 2,570). Reconcile: profit 1,800 + depreciation 50 (no cash left) − stock increase 80 (cash spent on stock not yet sold) − increase in debtors 50 (sold, not yet paid: 200 − 150) − drawings 350 = 1,370. Always show both numbers: profit tells you whether the business works; cash tells you whether you can pay on Friday. Level 2's cash-flow forecast and Unit 3 use cash.

Costing, pricing, margin and mark-up

Cost of a job = materials + labour + a share of overheads. A tailor's example (all figures are examples): fabric GH¢45, lining GH¢8, buttons and thread GH¢7 = GH¢60 of materials. Labour: 3 hours at GH¢15 = GH¢45. Overhead: monthly overheads GH¢900 ÷ 120 billable hours = GH¢7.50 per hour × 3 hours = GH¢22.50. Total cost = 60 + 45 + 22.50 = GH¢127.50.

Mark-up is the profit added as a percentage of cost. Margin is the profit as a percentage of price. They are not the same.

• A 40% mark-up on a cost of 127.50 gives a price of 127.50 × 1.40 = GH¢178.50. The profit is 51.00, and the margin is 51 ÷ 178.50 = 28.6%.
• To earn a 30% margin: price = cost ÷ (1 − 0.30) = 127.50 ÷ 0.70 = GH¢182.14. The profit is 54.64, and the mark-up is 54.64 ÷ 127.50 = 42.9%.

Contribution = price − costs that change with each sale (materials, packaging, commission). Overheads are paid from the contribution.

Break-even. The sales at which profit is zero: fixed costs ÷ contribution per unit. In the repair shop example: fixed costs per month are rent 400 + helper 700 + electricity and data 180 + transport 90 + depreciation 50 = GH¢1,420. An average repair sells for GH¢85 and the parts cost GH¢24, so contribution is GH¢61. Break-even = 1,420 ÷ 61 = 23.3, so 24 repairs a month, or GH¢2,040 of sales. At 50 repairs a month, the margin of safety is (50 − 24) ÷ 50 = 52%: sales can fall by about half before the shop makes a loss.

Price changes: Before you cut a price, compute the new contribution. If a GH¢85 repair is cut to GH¢75, contribution falls from 61 to 51, break-even rises from 24 to 28 repairs (1,420 ÷ 51 = 27.8). The cut needs about 17% more customers just to stand still.

Depreciation: tools wear out

Tools and equipment lose value as they are used. Straight-line depreciation = (cost − salvage value) ÷ useful life. Example: the shop's tools cost GH¢3,000, expected scrap value GH¢600, useful life 4 years. Depreciation = (3,000 − 600) ÷ 4 = GH¢600 a year = GH¢50 a month. After 12 months the book value is 3,000 − 600 = GH¢2,400. Depreciation is a real cost even though no cash leaves in the month: it tells you to save for replacement. The IFRS for SMEs Accounting Standard, whose 2025 edition applies from 1 January 2027, sets out full accounting rules for small and medium-sized companies; a chartered accountant will use it for company financial statements.

Separate owner and business money

For a company, the money in the business belongs to the company, and taking it out is regulated (for example, dividends can be paid only from profit); ask a chartered accountant.

Bank and MoMo reconciliation

Compare your cash book with the bank or MoMo statement each month and explain every difference.

Example (bank account). Cash book balance GH¢3,465. Statement balance GH¢4,020. Differences: bank charges GH¢15 not yet in the cash book; a customer's transfer GH¢200 on the statement but not yet in the cash book; a cheque of GH¢450 you issued that has not yet cleared; a deposit of GH¢80 you made that is not yet on the statement.

• Adjust the cash book: 3,465 − 15 + 200 = GH¢3,650.
• Adjust the statement: 4,020 − 450 + 80 = GH¢3,650.

They agree. If they do not, find the difference: check additions, check the opening balance, look for an amount missing on one side, a transposed number, or a charge or reversal. MoMo reconciliation works the same way: record the fees and the reversals shown in the transaction history; keep the SMS or app history; screenshot confirmations of large payments.

Tax records

Software and tools

Use a notebook, Excel or Google Sheets first. Zoho Books has a free plan for one user plus an accountant, up to 1,000 invoices a year and revenue under US$50,000. Wave offers a free Starter accounting plan. Check the current terms and whether the software suits Ghana's tax and e-VAT rules before you rely on it. An accountant should review your books at least once a year.

The monthly closing routine (12 steps)

Records for loans

A lender wants twelve months of cash book and statements, a balance sheet, tax receipts, a list of debtors and creditors, and a forecast. If your records are weak, the bank cannot judge your repayment ability. Poor bookkeeping is one reason small firms fail, alongside weak planning and lack of finance.

Competency standard

Range. The team's business; a real panel of three. Evidence. Quality and customer-care measures; growth and succession note; full business plan; 12-month forecast; panel observation.

Quality systems and continuous improvement

Quality means the product or service matches what you promised, every time. Build it into the system, not into your mood.

The improvement loop (author's teaching tool): plan the change, do it on a small scale, check the numbers, then adopt it or drop it. The same "build, measure, learn" cycle you used at Level 1.

A monthly dashboard of six numbers (example values):

Growth, safely

Growth options and their cash needs were in Unit 2. The signs of strain at the growth stage include cash running short, late deliveries, falling quality and an exhausted owner; cash strain is a key danger. Before each growth step ask:

Example: a second outlet. A shop costs GH¢30,000 to open, including stock and fit-out, and adds GH¢1,500 profit a month. The payback is 30,000 ÷ 1,500 = 20 months. If the first shop's profit falls because the owner is split across two sites, payback is longer. Ask what delegating the first shop would cost (Unit 1).

Licensing and franchising. Selling the right to use your name and method to others is a growth route that needs strong SOPs, trademark protection and a lawyer (Unit 4). Licensing, joint ventures and strategic alliances are riskier routes.

Succession: who runs it when you cannot?

Succession is planning who will own and run the business when you step back, fall ill or die. Without a plan, family disputes, frozen bank accounts and lost customers can destroy a business that took years to build. The author's checklist:

Exit options

Founders and investors may collect their return by selling the business (a "harvest"), merging, or, if it fails, closing it and paying creditors from the sale of assets. Compare the options:

Rough valuation (example). Buyers often offer a multiple of yearly profit plus the value of stock and equipment, but the multiples vary greatly by trade and place and Ghana-specific multiples were not verified. Example only: net profit GH¢24,000 a year; a buyer offers 2 times profit = GH¢48,000, plus stock at cost of GH¢6,000 = GH¢54,000. If the business earns GH¢24,000 a year for you, 2 years' profit buys the business back; ask whether the buyer can keep the customers and staff after you leave. A chartered accountant should check any real valuation.

Closing properly. Pay staff and apply the notice rules; pay SSNIT, PAYE and VAT; file final returns; cancel permits and insurance; keep records for at least six years. For a company, ask the Registrar how to close or be struck off, because the process was not verified here.

The capstone: a complete business plan

You have built the pieces across the three levels. The capstone puts them together in a plan of about eight to ten pages plus appendices, and a ten-minute pitch to a panel. The full plan has twelve sections:

1. Summary (one page): what, for whom, the money you ask for, why you will succeed.
2. The problem and the customers (Level 1 interviews; Level 2 proof).
3. Product or service and value proposition.
4. Market and competitors; position and strategy (Unit 2).
5. Marketing, sales and customer care; digital plan.
6. Operations: premises, equipment, SOPs, suppliers, quality.
7. People: owners, team, roles, hiring plan, pay, training.
8. Legal form, registration, permits, tax route and IP (Units 4 and 5).
9. Financial plan: start-up budget, funding, 12-month cash-flow forecast with a stress test, break-even, simple profit and loss and balance sheet (Unit 6).
10. Risks and controls; insurance; ethics and governance (Unit 4).
11. Growth, succession and exit (this unit).
12. The ask: how much, in what form, what it buys, what you offer back, and the next 90 days.

The 12-month cash-flow forecast. Use the layout in Unit 3: opening cash, monthly sales (likely and low), cash in, cash out by line, net, closing. Show the lowest cash balance and the month. State the main assumptions in a list: the sales growth, the share of materials, wages, payment days of customers, the loan terms. Do not invent numbers: every figure is from a record, a quote, a source or a clearly labelled assumption. An assumption you cannot defend loses the panel.

Panel pitch plan (ten minutes): one minute on the problem and the customer; two minutes on proof and strategy; two minutes on the money (forecast, break-even, stress test); one minute on people and legal set-up; one minute on risks; one minute on the ask; two minutes of questions at least. Practise out loud, speak slowly, look at the panel.

Questions panellists may ask: What happens if sales fall 20%? What is your lowest cash month? Who can run the business without you? What is your biggest risk, and what have you done about it? What did you learn from a customer who said no? Where does this number come from? What would make you stop?

1. What is a bottleneck, and why fix it before adding sales?
2. Name four parts of a good SOP.
3. What does an employer pay to SSNIT as the employer share, and what does the employee pay?
4. What is the difference between mark-up and margin?
5. Why can a flat-rate loan cost much more than its quoted yearly rate suggests?
6. An investor puts GH¢100,000 into a business for 20%. What is the post-money value?
7. Name five items in an investor readiness file.
8. How many directors must a company limited by shares have at registration, and what is the ORC filing fee?
9. What are the 2026 sole-trader Modified Taxation rates for turnover of GH¢20,001 to GH¢750,000?
10. How is straight-line depreciation worked out?
11. Why is the trial balance only a partial check?
12. For how long must tax records be kept in Ghana?

Best next reads: Money Skills for Small Business Level 2 (and Level 3 when available); the ILO's Start and Improve Your Business packages; Strategyzer's business model canvas pages; the Ghana Enterprises Agency and its Takoradi Business Advisory Centre; the Office of the Registrar of Companies; the Ghana Revenue Authority; the Labour Act, 2003 (Act 651).

What this module does not cover: contract law in depth, detailed company law and share issue rules, term sheets, patents and industrial designs, cooperative law, GSA and EPA permit details, Energy Commission licensing, compulsory insurance rules, wills and inheritance, full IFRS accounting, and tax advice for a specific case. Ask a lawyer or a chartered accountant.

Every source used in this manual is listed, with links, in the Teacher Copy.