In contrast to direct speech, in which the exact words of the speaker are given, indirect speech is a form of utterance in which these words are reported.

When direct speech is converted into indirect speech the following changes are introduced:

#1. The quotation marks and the comma (or colon) are omitted.

#2. If the speaker reports somebody else’s words the pronouns of the 1st person are replaced by those of the 3rd person; the pronouns of the 2nd by those of the 1st or 3rd.

He said, “I am ready.” He said he was ready.

If the speaker reports his or her own words, the pronouns are naturally not changed:

I said, “I am ready.” I said I was ready.

#3. If the verb in the principal clause is in the past tense, demonstrative pronouns and adverbials expressing nearness are replaced by words expressing distance:

Here There
This That
These Those
Now Then; At that time (moment); or no adverb is used at all
Today That day
Yesterday The day before; On the previous day
Ago Before
Last Previous
Direct Speech Indirect Speech
She said, “We have been here for a week.” She said they had been there for a week.
She said, “I met them yesterday.” She said she had met them the day before.
She said, “We can’t settle anything now.” She said they could not settle anything at that moment (then).

If the speaker speaks in the same place and at the same time as the speaker whose words are reported, the demonstrative pronouns and adverbs are not changed.

An hour ago he said he would come here tonight.

I told him I wouldn’t give him an answer till tomorrow. (Wilde)

#4. If the verb in the principal clause is in the past tense, the tenses are changed according to the rule of the sequence of tenses.

Direct Speech Indirect Speech
The Present Indefinite is replaced by the Past Indefinite. She said, “We often write letters.” She said they often wrote letters.
The Present Continuous is replaced by the Past Continuous. She said, “We are writing a letter.” She said they were writing a letter.
The Present Perfect is replaced by the Past Perfect. She said, “We have just written a letter.” She said they had just written a letter.
The Present Perfect Continuous is replaced by the Past Perfect Continuous. She said, “We have been writing for an hour.” She said they had been writing for an hour.
The Past Indefinite is replaced by the Past Perfect. She said, “We wrote a letter last night.” She said they had written a letter the previous night.
The Past Continuous generally remains unchanged or is replaced by the Past Perfect Continuous. She said, “I was writing at 5 o’clock.” She said she was (had been) writing at

5 o’clock.
The Past Perfect remains unchanged. She said, “We had written the letter by 5 o’clock.” She said they had written the letter by 5 o’clock.
The Past Perfect Continuous remains unchanged. She said, “We had been writing for an hour by 5 o’clock.” She said they had been writing for an hour by 5 o’clock.
The Future Indefinite is replaced by the Future Indefinite in the Past. She   said,  “We’ll   write   a   letter  tomorrow.” She said they would write a letter the next day.
The Future Continuous is replaced by the Future Continuous in the Past. She   said,   “We’ll   be   writing   at   5 o’clock.” She said they would be writing at 5 o’clock.
The Future Perfect is replaced by the Future Perfect in the Past. She said, “We’ll have written the letter by 5 o’clock.” She said they would have written the letter by 5 o’clock.
The Future Perfect Continuous is replaced by the Future Perfect Continuous in the Past. She said, “We’ll have been writing for 2 hours by 5 o’clock.” She said they would have been writing for 2 hours by 5 o’clock.
If the Past Indefinite in direct speech denotes an action taking place at a definite moment, it remains unchanged in indirect speech. She said, “I had left home before the telegram came.” She said she had left home before the telegram came.
The Past Indefinite after since generally remains unchanged. She said, “I have been writing since I came.” She said she had been writing since she came.

#5. When sentences containing the Subjunctive Mood are converted into indirect speech the form of the verb usually remains unchanged.

However, there is a case when, the rule of the sequence of tenses is observed: if we have the analytical subjunctive with the mood auxiliary may, may is changed into might if the verb in the principal clause stands in a past tense.

Direct Speech Indirect Speech
I should be discharged if I were seen speaking to you. (Shaw) She said that she would be discharged if she were seen speaking to him.
It is true I drink, but I shouldn’t have taken to that if things had gone differently. (Maugham) He admitted that he drank, but said he would not have taken to that if things had gone differently.
I think cheerfulness is a fortune in itself. I wish I had it. (Eliot) She thought cheerfulness was a fortune in itself. She wished she had it.
Oh, how I wish I had never seen him! (Hardy) She said she wished she had never seen him.
The boys will think none the worse of you whatever you may have done. (Conan Doyle) He said that the boys would think none the worse of him whatever he might have done.

#6. The verb introducing direct speech is replaced by another verb which shows whether the indirect speech is a statement, a question, an order (request) or an exclamation.

Direct Speech Indirect Speech
She said, “I’ve never seen the like of it.” She declared she had never seen the like of it.
She said to him, “Do you know them?” She asked him if he knew them.
She said to him, “Come here at once!” She told him to come at once.
She said, “Why, I never expected he would do such a thing.” She exclaimed she had never expected he would do such a thing.

#7. It should be borne in mind that there is a great difference between the styles of direct and indirect speech.

Direct speech is characterized by a certain looseness of structure and is more emotional than indirect speech.

Indirect speech, on the contrary, is characterized by rigid logic of structure and terseness.

Accordingly, if, for instance, no conjunctions expressing causal relations are to be found in direct speech, they must be introduced into indirect speech.

Direct Speech Indirect Speech
She said, “I am so tired! I’ve been writing for five hours.” She said she was very tired as she had been writing for five hours.

If certain words and phrases are repeated in direct speech, they must not be reproduced in indirect speech.

Direct Speech Indirect Speech
She said to him, “It’s very kind of you to offer to help me, very kind indeed.” She said it was very kind of him to offer to help her.

So and such are replaced by very, exceedingly, etc. in exclamatory sentences.

Direct Speech Indirect Speech
She said, “Jane plays the piano so well!” She said Jane played the piano very well.
She said, “Jane is such a good pianist!” She said Jane was an exceedingly (very) good pianist.

Interjections must be replaced by suitable adverbial modifiers.

Direct Speech Indirect Speech
She said, “Alas! I’ll never be happy again!” She exclaimed in despair she would never be happy again.

#8. Must, as a rule, remains unchanged in indirect speech if it expresses advice (order) or a supposition bordering on assurance.

Direct Speech Indirect Speech
She said to him, “You must be more careful.” (advice) She told him he must be more careful.
She said, “You must be very fond of music if you go to concerts so often.” (supposition) She said he must be very fond of music if he went to concerts so often.

She was informed that she must never again walk much. (Hardy)

He said he was afraid you must think him ungrateful. (Marryat)

Mr. Brownlow smiled and said that Mr. Grimwig was an old friend of his and he must not mind his being a little rough in his manners. (Dickens)

Must is generally replaced by had to if it expresses a necessity arising out of circumstances.

Direct Speech Indirect Speech
She said, “I must get up early every morning.” She said she had to get up early every morning.

Must is generally replaced by was to if it expresses arrangement or a kind of order.

Direct Speech Indirect Speech
She said, “I must ring him up at two o’clock.” She said she was to ring him up at two o’clock