How To Fix THM_EXPOSURE206 - The sum of assigned hedge volumes is greater than the nominal amount

SAP Error Message - Details

• Message type: E = Error

• Message class: THM_EXPOSURE - E-Hedge Accounting: Exposure

• Message number: 206

• Message text: The sum of assigned hedge volumes is greater than the nominal amount

Self-Explanatory Message

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Smart SAP Assistant

• What is the cause and solution for SAP error message THM_EXPOSURE206 - The sum of assigned hedge volumes is greater than the nominal amount ?

  The SAP error message THM_EXPOSURE206 indicates that the total of the assigned hedge volumes exceeds the nominal amount of the underlying exposure. This typically occurs in the context of hedge accounting, where the system is trying to ensure that the hedging instruments (like derivatives) do not exceed the amount of the underlying exposure they are meant to hedge.
  Cause:
  
  Incorrect Hedge Volume Assignment: The volumes assigned to the hedging instruments may have been entered incorrectly, leading to a total that exceeds the nominal amount.
  Changes in Exposure: The nominal amount of the underlying exposure may have changed (e.g., due to a reduction in the exposure), but the hedge volumes were not adjusted accordingly.
  Multiple Hedges: If multiple hedging instruments are assigned to the same exposure, their combined volumes may exceed the nominal amount.
  Data Entry Errors: Manual errors during data entry can lead to discrepancies between the hedge volumes and the nominal amount.
  
  Solution:
  
  Review Hedge Assignments: Check the assigned hedge volumes in the system. Ensure that the total of these volumes does not exceed the nominal amount of the underlying exposure.
  Adjust Hedge Volumes: If the assigned volumes are too high, adjust them to ensure they are within the limits of the nominal amount.
  Reassess Exposure: If the nominal amount of the exposure has changed, update the exposure details in the system to reflect the current situation.
  Consult Documentation: Refer to SAP documentation or guidelines on hedge accounting to ensure compliance with the necessary accounting standards and practices.
  System Configuration: If this issue persists, it may be necessary to review the configuration settings in the SAP system related to hedge accounting to ensure they are set up correctly.
  
  Related Information:
  
  Hedge Accounting: Understanding the principles of hedge accounting is crucial, as it involves managing financial risks associated with fluctuations in currency, interest rates, or commodity prices.
  SAP Transaction Codes: Familiarize yourself with relevant transaction codes in SAP for managing hedges, such as transaction codes for creating, changing, or displaying hedging relationships.
  SAP Notes: Check for any SAP Notes related to this error message, as they may provide additional insights or patches that could resolve the issue.
  Consulting with Experts: If the problem persists, consider consulting with SAP experts or your organization's finance team to ensure that the hedge accounting practices are being followed correctly.
  
  By addressing the underlying causes and following the suggested solutions, you should be able to resolve the THM_EXPOSURE206 error in SAP.