How To Fix TPM_THXE1014 - Hedging rel. &1/&2: Retrospective test on &3 is not effective

TPM_THXE1014 - Overview

• Message type: E = Error

• Message class: TPM_THXE1 - message class for effectiveness test

• Message number: 014

• Message text: Hedging rel. &1/&2: Retrospective test on &3 is not effective

What causes this issue?

You want to calculate a prospective effectiveness test. This step in
Hedge Accounting is only allowed if the hedging relationship was always
tested as effective in the history before the test date in both test
types, prospective and retrospective effectiveness test.

System Response

The system issues an error message and will not allow you to continue with this transaction until the error is resolved.

How to fix this error?

Procedure for System Administrators

Error message extract from SAP system. Copyright SAP SE.

Smart SAP Assistant

• What is the cause and solution for SAP error message TPM_THXE1014 - Hedging rel. &1/&2: Retrospective test on &3 is not effective ?

  The SAP error message TPM_THXE1014 typically relates to the hedging functionality within the SAP Treasury and Risk Management (TRM) module. This error indicates that a retrospective test for a hedging relationship is not effective, which means that the hedging relationship does not meet the effectiveness criteria as defined by accounting standards (such as IFRS or US GAAP).
  
  Cause:
  The error can occur due to several reasons, including:
  
  
  Ineffective Hedging Relationship: The hedging relationship may not be effective, meaning that the changes in the fair value or cash flows of the hedged item do not offset the changes in the fair value or cash flows of the hedging instrument.
  
  
  Data Issues: There may be missing or incorrect data in the hedging relationship setup, such as incorrect valuation parameters, missing market data, or incorrect hedge ratios.
  
  
  Timing Issues: The timing of the transactions may not align properly, leading to discrepancies in the effectiveness testing.
  
  
  Regulatory Changes: Changes in