How To Fix TEM_MESSAGES_AL119 - Hedge transaction necessary for exposure &1

SAP Error Message - Details

• Message type: E = Error

• Message class: TEM_MESSAGES_AL - Messages for TEM-AL Layer

• Message number: 119

• Message text: Hedge transaction necessary for exposure &1

Self-Explanatory Message

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Smart SAP Assistant

• What is the cause and solution for SAP error message TEM_MESSAGES_AL119 - Hedge transaction necessary for exposure &1 ?

  The SAP error message TEM_MESSAGES_AL119 indicates that a hedge transaction is necessary for a specific exposure. This message typically arises in the context of Treasury and Risk Management (TRM) within SAP, particularly when dealing with financial instruments and hedging activities.
  Cause:
  The error occurs when there is an exposure (such as a foreign currency exposure, interest rate exposure, etc.) that requires a corresponding hedge transaction to mitigate risk. The system identifies that the exposure is not adequately covered by a hedge, which is necessary for proper risk management and compliance with accounting standards.
  Solution:
  To resolve this error, you should take the following steps:
  
  
  Identify the Exposure: Determine the specific exposure that is causing the error. This can usually be done by checking the details of the exposure in the SAP system.
  
  
  Create a Hedge Transaction: Once you have identified the exposure, you need to create a hedge transaction that corresponds to it. This can involve:
  
  Creating a new hedge instrument (e.g., forward contracts, options, swaps).
  Ensuring that the hedge transaction is properly linked to the exposure.
  
  
  
  Check Hedge Accounting Settings: Ensure that your hedge accounting settings are correctly configured in SAP. This includes verifying that the hedge relationship is established and that the necessary parameters are set up.
  
  
  Review Hedge Effectiveness: After creating the hedge transaction, check the effectiveness of the hedge. SAP may require that the hedge is effective in offsetting the exposure to avoid further errors.
  
  
  Consult Documentation: Refer to SAP documentation or your organization's internal guidelines for specific procedures related to hedge transactions and exposures.
  
  
  Seek Help from SAP Support: If you are unable to resolve the issue, consider reaching out to SAP support or your internal SAP team for further assistance.
  
  
  Related Information:
  
  Hedge Accounting: Understand the principles of hedge accounting, including the types of hedges (fair value hedges, cash flow hedges, etc.) and the documentation required.
  SAP Transaction Codes: Familiarize yourself with relevant SAP transaction codes related to Treasury Management, such as:
  
  TPM1: Create Hedge Transaction
  TPM2: Change Hedge Transaction
  TPM3: Display Hedge Transaction
  
  
  Training and Resources: Consider training sessions or resources on SAP Treasury Management to better understand how to manage exposures and hedges effectively.
  
  By following these steps, you should be able to address the TEM_MESSAGES_AL119 error and ensure that your exposures are properly hedged in the SAP system.