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Accounting 4425  

Industry & Company Ratios
Last Updated: Sep 1, 2016 URL: http://berkeleycollege.libguides.com/content.php?pid=528556 Print Guide RSS UpdatesEmail Alerts

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Overview

Welcome! This guide was developed to assist with conducting company and industry research.  The resources listed can be found on the Berkeley College Library's website and the Internet.

Laurie McFadden

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Laurie McFadden
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What is an Industry Norm?

Industry Norms and Business Ratios

When starting a business or comparing a company's performance to competitors in its industry, you will need sample financial statements, also known as “industry norms” or “operating ratios”.     Data for typical operating items such as assets, debt, sales, profit, labor, advertising, rent, and insurance expense, as well as other financial ratios may be found in a number of places including the investor relations selection of a company's webpage or on the Company Financials tab in the Mergent Online database.  

In order to compare the information for a company to an industry, you will need the industry code.

What is an Industry Code?

It is a numeric method of classifying/identifying companies by their main line of business for the purpose of monitoring industry performance.  Standard Industrial Classification (SIC) is a 4-digit code in use until the signing of the NAFTA treaty.  In 1997 a 6-digit system known as the North American Industrial Classication System (NAICS) replaced the SIC code.  Canada and Mexico are included in NAICS system.

Why is this important?

  • Easy to identify specific companies with in an industry.
  • Many companies have more than one industry code.
      

    Finding a Company's Industry Code

    How to Find a Company's NAICS or SIC Industry Code

    1. Before you can locate company or industry ratios, you'll need to know the company's NAICS or SIC code.

    2. To find your company's industry code use the database Mergent Online.

    3. Enter your company's name or ticker symbol in the search box and click search.

    4. Click on the company name.  Industry: SIC and Industry NAICS codes appear in the center of the blue box on across the top of the page. (purple area)

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