How To Fix THMHR_ADMIN022 - Derivative &1, comp. code &2 cannot be used to hedge commodity price risk

SAP Error Message - Details

• Message type: E = Error

• Message class: THMHR_ADMIN - Messages for managing hedge relationships

• Message number: 022

• Message text: Derivative &1, comp. code &2 cannot be used to hedge commodity price risk

Self-Explanatory Message

Since SAP believes that this specific error message is 'self-explanatory,' no more information has been given.The majority of messages in the SAP system have a message text, however this is frequently insufficient to comprehend or resolve the problem.

To make things easier, more detailed information is frequently added to describe the issue, how to fix it, and the necessary steps or configuration modifications.

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Smart SAP Assistant

• What is the cause and solution for SAP error message THMHR_ADMIN022 - Derivative &1, comp. code &2 cannot be used to hedge commodity price risk ?

  The SAP error message THMHR_ADMIN022 indicates that a specific derivative (identified by &1) and company code (identified by &2) cannot be used to hedge commodity price risk. This error typically arises in the context of Treasury and Risk Management (TRM) within SAP, particularly when dealing with financial instruments used for hedging purposes.
  Cause
  The error can be caused by several factors, including:
  
  
  Incorrect Configuration: The derivative may not be properly configured in the system to be used for hedging commodity price risks. This could involve missing settings in the derivative's master data or in the hedging configuration.
  
  
  Incompatible Derivative Type: The derivative type may not be compatible with the commodity price risk hedging. For example, certain derivatives are designed for interest rate or currency risks rather than commodity risks.
  
  
  Company Code Restrictions: The company code specified may not be authorized to use the particular derivative for hedging purposes. This could be due to internal policies or system settings.
  
  
  Missing Hedging Relationships: There may be no established hedging relationship between the derivative and the underlying commodity exposure.
  
  
  Regulatory or Compliance Issues: There may be regulatory restrictions that prevent the use of certain derivatives for hedging specific types of risks.
  
  
  Solution
  To resolve the error, consider the following steps:
  
  
  Check Derivative Configuration: Review the configuration of the derivative in the system. Ensure that it is set up correctly for hedging commodity price risks. This includes checking the master data and ensuring that all necessary fields are filled out.
  
  
  Verify Derivative Type: Confirm that the derivative type is appropriate for hedging commodity price risks. If it is not, you may need to select a different derivative that is compatible.
  
  
  Review Company Code Settings: Check the settings for the company code to ensure that it is allowed to use the specified derivative for hedging. This may involve reviewing internal policies or system authorizations.
  
  
  Establish Hedging Relationships: If there is no existing hedging relationship, you may need to create one between the derivative and the underlying commodity exposure. This can typically be done through the hedging configuration in SAP.
  
  
  Consult Documentation: Review SAP documentation or consult with your SAP support team for specific guidelines related to the error message and the configuration of derivatives and hedging.
  
  
  Test in a Sandbox Environment: If possible, replicate the issue in a sandbox environment to test potential solutions without affecting production data.
  
  
  Related Information
  
  SAP Notes: Check for any relevant SAP Notes that may address this specific error or provide additional guidance on configuring derivatives for hedging.
  SAP Community: Engage with the SAP Community forums to see if other users have encountered similar issues and what solutions they have found.
  Training and Documentation: Ensure that users involved in managing derivatives and hedging are adequately trained and have access to the necessary documentation.
  
  By following these steps, you should be able to identify the root cause of the error and implement a solution to allow the derivative to be used for hedging commodity price risk.