Data structure and evaluation of data is another source of ambiguity about the results. For better results there is always a need of required and useful data. In most of the cases required data is not available and consequently, researchers have to rely on the limited data and this kind of situation may lead to an unexpected outcome (Gupta and Huffier 1972).

Working with a limited data would not allow to make certain absolute statements. Rather, results may be classified into broad categories. In this study we are also facing this dilemma and we are unable to put forward any absolute statement.

However, we will be able to give mean, minimum and maximum values. These values will provide a broader view about the spinning industry of Pakistan. Osteryoung et al (1992) have compared financial ratio of small, medium, and large firms and concluded that there is a significant difference among the ratios. However, there are few ratios which show consistency.

Their study explores that ratios cannot be used with same mindset. In previous lines we have discussed the validity of ratios and standards for comparison. Here we have come across another issue and that is the size of the firms.Along with size, business type is also a matter of concern. Ratios of retail business naturally will be different from the manufacturing business. This is the issue which we are facing in this research.

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It defies common sense if we compare ratios of spinning industry of Pakistan with any manufacturing sector. We need to have ratios from the same sector, which apparently seems difficult. Lev (1969) had tried to solve this issue and explained that traditionally firms compare their ratios with average of the sector.

Lev studied and found that generally firms adjust their targets according to the mean of the said sector.Nevertheless, there are also predetermined standards available in the literature but their application is quite different. This difference may be due to size or due to the nature of the business. In our view this difference may be cyclic in nature. Rees (1995) has also discussed this issue.

According to Rees, Data is informative when related to a point of comparison. Benchmarking is misleading when applied to different industries. Benchmarking can be achieved through a time series comparison with examined firms or by using cross sectional perspective by using industry average.

Firm’s performance should always be judged keeping in view the overall performance of the sector. If there is a general decline or rise, it means nothing is special with any particular firm. However rate of change must be compared with other players. For ratio selection Rees states that it is always difficult to select most appropriate ratio.

However, too many ratios may become cause of a subset of ratios. Keeping all constraints in view we will compare the ratios with generally acceptable ratios and this study will also provide a benchmark for future studies.All above discussion is to give a summary about the description of financial ratios, implication attached with selection and application. It is obvious from the literature review that financial ratios are under use since centuries. However, acceptance of these ratios as a separate filed is linked with industrial revolution and in current era its significance has been fortified due to rapid transaction and turmoil business situation.

In our view stock exchange activities have also given a boost to these ratios. Since these ratios are highly useful for shareholders.Banking area is also relying a lot on these ratios since they are also one of the stakeholders. Comparison and benchmarking for financial ratios is one of the major issues.

Above discussion summarizes that there is no international benchmarking for these ratios. Ratios should be compared within same sector and keeping in view the context. This study also gives the average values of the sector and individual firms can compare their ratios with the average of the sector. This study will also be useful for future reference.