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Accounting: Industries

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Industry codes identify an industry or service a business provides:

  • NAICS (North American Industry Classification System) is the most common industry code and is used to find ratio information.
  • SIC (Standard Industrial Classification) is predominantly being replaced by NAICS. 

Frequently asked questions about the NAICS code.

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Industry ratios are an aggregate measure of industry performance.
Data is gathered from the financial statements of hundreds of firms to calculate industry averages.
The results are often broken into categories based on the asset size of the companies.
The ratios are then used as a benchmarking tool in comparing a company's performance to that of its industry.

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