Using awk over 2 files?

Hi,
I wanted to do a check of each record in file 1 against all the records in file 2 to find matches (or not)

so as sudo code would be something like

awk 
'{
loop through each record of file 2
            if $1.file1 == $3.file2 then
                       do xyz
            else
                       do abc
}' file 1

How can I do this in awk??? (would prefer a simple scripted approach as above rather than a one liner that I probably wont understand!)

Typically an associative array would be used for that, if the files are not too massive:

awk '
  NR==FNR{
    A[$1]
    next
  } 
  { 
    if(A[$3] in A) {
      do xyz 
    }
    else {
      do abc 
    }
  }' file2 file1