Direct and indirect speech

Introduction.
There two ways to convey a message of a person, or the words spoken by a person to other person.

Direct speech
Indirect speech

Suppose your friend whose name is John tells you in school, “I will give you a pen”. You come to home and you want to tell your brother what your friend told you. There are two ways to tell him.

Direct speech: John said, “I will give you a pen”.
Indirect Speech: John said that he would give me a pen.

In direct speech the original words of person are narrated (no change is made) and are enclosed in quotation mark. While in indirect speech some changes are made in original words of the person because these words have been uttered in past so the tense will change accordingly and pronoun may also be changed accordingly. In indirect speech the statement of the person is not enclosed in quotation marks, the word “that” may be used before the statement to show that it is indirect speech. Indirect speech is also called reported speech because reported speech refers to the second part of indirect speech in which something has been told by a person.
Reporting verb: The verb first part of sentence (i.e. he said, she said, he says, they said, she says,) before the statement of a person in sentence is called reporting verb.
Examples. In all of the following example the reporting verb is “said”.
              He said, “I work in a factory”                           (Direct speech)
              He said that he worked in a factory.                (Indirect speech)
              They said, “we are going to cinema”               (Direct speech)
              They said that they were going to cinema.      (Indirect speech)
Reported Speech. The second part of indirect speech in which something has been told by a person (which is enclosed in quotation marks in direct speech) is called reported speech. For example, a sentence of indirect speech is, He said that he worked in a factory. In this sentence the second part “he worked in a factory” is called reported speech and that is why the indirect speech as a whole can also be called reported speech.

Fundamental rules for indirect speech.

Reported speech is not enclosed in quotation marks.
Use of word “that”: The word “that” is used as a conjunction between the reporting verb and reported speech.
Change in pronoun: The pronoun (subject) of the reported speech is changed according to the pronoun of reporting verb or object (person) of reporting verb (first part of sentence). Sometimes the pronoun may not change.

In following example the pronoun of reported speech is “I” which will be changed in indirect speech into the pronoun (Subject) of reporting verb that is “he”.

Example.
       Direct speech: He said, “I am happy”
       Indirect Speech: He said that he was happy.
       Direct speech: I said to him, “you are intelligent”
       Indirect Speech: I said him that he was intelligent. (“You” changed to “he” the                                                                                person of object of reporting verb)

Change in time: Time is changed according to certain rules like now to then, today to that day, tomorrow to next day and yesterday to previous day.

Examples.
Direct speech: He said, “I am happy today”
Indirect Speech: He said that he was happy that day.

Change in the tense of reported speech: If the first part of sentence (reporting verb part) belongs to past tense the tense of reported speech will change. If the first part of sentence (reporting verb part) belongs to present or future tense, the tense of reported speech will not change.

Examples.
   Direct speech: He said, “I am happy”
   Indirect Speech: He said that he was happy. (Tense of reported speech changed)
   Direct speech: He says, “I am happy”
   Indirect Speech: He said that he is happy. (Tense of reported speech didn’t                                                                          change)

Change in tense is made according to rules of indirect speech which are given in table below.