How To Fix THMHR_ADMIN031 - Rollover of hedge relationship &1 not possible: overhedged item

SAP Error Message - Details

• Message type: E = Error

• Message class: THMHR_ADMIN - Messages for managing hedge relationships

• Message number: 031

• Message text: Rollover of hedge relationship &1 not possible: overhedged item

Self-Explanatory Message

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• What is the cause and solution for SAP error message THMHR_ADMIN031 - Rollover of hedge relationship &1 not possible: overhedged item ?

  The SAP error message THMHR_ADMIN031 indicates that a rollover of a hedge relationship is not possible due to an overhedged item. This typically occurs in the context of hedge accounting within SAP Treasury and Risk Management (TRM) when the hedging relationship is not aligned with the underlying exposure.
  Cause:
  The error arises when:
  
  Overhedging: The hedging instrument (e.g., a derivative) has a notional amount that exceeds the underlying exposure it is meant to hedge. This can happen if the underlying exposure has decreased or if the hedge was set up with an incorrect notional amount.
  Hedge Relationship Issues: The hedge relationship may not be properly defined or may have been altered, leading to inconsistencies in the hedge accounting.
  Accounting Period Issues: The rollover process may be trying to execute in a period where the hedge relationship is not valid due to accounting rules or settings.
  
  Solution:
  To resolve the error, consider the following steps:
  
  
  Review Hedge Relationships:
  
  Check the details of the hedge relationship associated with the error. Ensure that the notional amounts of the hedging instruments align with the underlying exposures.
  Adjust the notional amount of the hedge if necessary to match the underlying exposure.
  
  
  
  Adjust Overhedged Items:
  
  Identify the overhedged items and determine if they can be adjusted or if the hedge needs to be restructured.
  If the overhedged item is no longer relevant, consider closing or adjusting the hedge relationship.
  
  
  
  Check Accounting Settings:
  
  Ensure that the accounting settings for hedge accounting are correctly configured. This includes checking the hedge effectiveness testing and the accounting periods involved.
  
  
  
  Consult Documentation:
  
  Refer to SAP documentation or help notes related to hedge accounting and the specific error message for additional guidance.
  
  
  
  Engage with SAP Support:
  
  If the issue persists after taking the above steps, consider reaching out to SAP support for further assistance. They may provide insights specific to your configuration and version of SAP.
  
  
  
  Related Information:
  
  Hedge Accounting: Understanding the principles of hedge accounting is crucial. Familiarize yourself with the definitions of overhedging, hedge effectiveness, and the requirements for hedge relationships.
  SAP Notes: Check for any relevant SAP Notes that may address this specific error or provide updates and patches that could resolve the issue.
  Training and Documentation: Consider training sessions or documentation on SAP Treasury and Risk Management to better understand the configuration and management of hedge relationships.
  
  By following these steps, you should be able to identify the root cause of the error and implement a solution to allow for the successful rollover of the hedge relationship.