Capitalised borrowing cost
AccountingAlso called: Interest capitalisation
Interest directly attributable to acquiring or constructing an asset that takes a substantial period to get ready, added to the cost of that asset instead of charged against profit.
In plain terms
The money still leaves the bank; it simply does not appear in the finance cost line. When the asset is ready capitalisation stops, the finance cost steps up with no new borrowing, and the amount already capitalised returns as depreciation rather than interest.