Best way to annotate documents in Teams on iOS

Myself and a lot of colleagues use iPads to teach and assess work. We are setting a lot of work on Teams that we need to mark. Many of us would like to use our Apple pencils to annotate directly onto their work just like in an exercise book.

Obviously the class notebook is the best place for this and many are using it. Have people had success annotating Word documents directly in Teams? When I try it, there is no pencil support in Teams, and opening in app returns an error.