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It compares people of the same age or age category and assumes that IQ is normally distributed, that the average (mean) is 100 and that the standard deviation is something like 15 (IQ tests sometimes differ in their standard deviations).
Most psychologists would say those scoring in a range of 95 to 105 are of a normal intelligence or have an average IQ. Actual IQ score may vary plus or minus five points since it is very difficult to get an IQ score with complete accuracy. Keep in mind, there are many outside factors that may have a negative impact on your score. For instance, if you are not feeling well at the time of taking the test.