this is copied straight from my notes:
Time comparison (time-series analysis) time comparison involves comparing information from the current period with previous period. It will reveal improving or declining trends and whether the current periods figures are acceptable.
Industry averages (cross-sectional analysis) average figures are prepared by research groups such as the Australian Bureau of Statistics and the Financial Management Research Centre. This is useful because it can show how the business is placed within the industry i.e. whether it is a market leader, or it is under performing. Businesses will usually compare itself to the best company in the industry.
General Business Standards (Benchmarking) this occurs when commonly accepted benchmark standards that apply to all businesses are used in financial analysis. Over time, common standards have become viewed as acceptable e.g. it will always be considered excellent for a company to give a return on equity of 20% p.a.
