Intermediate consumption consists of goods and services consumed as inputs by a process of production, excluding fixed assets whose consumption is recorded as consumption of fixed capital. The goods and services are either transformed or used up by the production process.
Two concepts of final consumption are used:
(a) final consumption expenditure (P.3);
(b) actual final consumption (P.4).
Final consumption expenditure is expenditure on goods and services used by households, NPISHs and government to satisfy individual and collective needs. By contrast, actual final consumption refers to its acquisition of consumption goods and services. The difference between these concepts lies in the treatment of certain goods and services financed by the government or NPISHs but supplied to households as social transfers in kind.