Are all interest costs capitalized?

Not all interest costs are capitalized. Instead, only such costs are capitalized that are incurred on qualifying assets during the eligible capitalization period and that too only to a certain maximum limit. In the context of capitalization of interest, a qualifying asset is an asset for which capitalization of borrowing cost is allowed.

What is capitalized interest in IFRS?

Capitalized interest is US GAAP term that refers to the part of interest expense that is capitalized as part of the cost of asset. IFRS uses the term borrowing costs for costs incurred in relation to a debt used for construction of the asset.

What is the interest cost eligible for capitalization?

The interest cost eligible for capitalization shall be the interest cost recognized on borrowings and other obligations. The amount capitalized is to be an allocation of the interest cost incurred during the period required to complete the asset.