This is usually a side account that is not reflected in the balance sheet/ income statement. If the interest is eventually collected it may be posted as other income along with the collected principal, since the interest and principal may have already been classified as a loss and written off.

From the link below (and there are many more if one likes):
"Suspension of Interest on Non-Performing Loans

All interest accrued (but uncollected) from the date an account is classified as non-performing shall forthwith be suspended and credited to the "Interest in Suspense" account. This interest shall only be recognized as income as and when it is collected in cash by the financial institution"