Release Hedging Business Transactions
Application component: Transaction Management
App type: SAP GUI
Scope items: Hedge Accounting for FX Swap - Group Ledger IFRS|Hedge Accounting for FX Forward - Group Ledger IFRS|Hedge Accounting for FX Option - Group Ledger IFRS
Key features:  Process steps are executed at release of designation   The hedged item has already been created during the automated designation process with the following dates:   Start Date The start date represents the contract start date of the financial transaction.   End Date The end date of the hedging relationship is derived from the reclassification offset category of the relevant hedging area. If you activated a due date shift in the hedging area, the end date of the hedged item is either the first day of the following month or the last day of the following month after the due date of the hedging instrument.   With the release of designation, the hypothetical derivative is created in addition. (For more information, see Hypothetical Derivative (Hedge Accounting for Exposure Items).) Note Two hypothetical derivatives are created in cases where you use a collar as the hedging instrument. Go to the Hedged Item tab in the Manage Hedging Relationships app to select the hypothetical derivative that you want to display from the dropdown list.   The calculation of the hedge accounting key figures (NPV components and NPV elements for the hedging instrument and the hypothetical derivative on designation date) is executed (Hedge Accounting Key Figures), so the start values of the hedging instrument and the hypothetical derivative on designation date are calculated. These values are then stored in the market data container. The hedge accounting key figures are determined based on the settings made in the respective hedge accounting calculation type.   The elements and contract rate components are calculated once you release the designation, and they are then stored in the market data container.  The element values are required for the determination of the calculation rule for the cost of hedging reserve.   The market value components are calculated when you release the designation and then again at period end during the NPV calculation. The component values are required for the classification that takes place during the release of hedging business transactions.     If the prospective effectiveness test is enabled for the hedging profile, and a test plan has been generated containing a record for the designation (or FX swap transfer) date and a market data set, the system executes the prospective effectiveness. For more information, see: Prospective Effectiveness Test Using Linear Regression   For cash flow hedges with the hedged item category Planned Forecast, the calculation rule for the cost of hedging reserve is applied.  The actual and aligned values of the hedging instrument and the hypothetical derivative are calculated according to the hedge accounting calculation rule.   The absolute amount of the actual value of the hedging instrument is compared with the absolute amount of the aligned value of the hypothetical derivative. The result determines how the cost of hedging reserve amounts are calculated and posted to the P&L statement. The result is stored and displayed on the hedging relationship level in the market data container.   One of the following calculation rules for the cost of hedging reserve was determined:   1 - Actual Value = Aligned Value The change in the amount of the actual value is posted to the cost of hedging reserve.   2 - Actual Value > Aligned Value The change in the amount of the aligned value is posted to the cost of hedging reserve.   3 - Aligned Value > Actual Value The cost of hedging reserve is determined based on the lower-of test. The smaller amount of the actual and aligned value is posted to the cost of hedging reserve and the remaining amount is posted to the P/L statement.  Note To overwrite the calculation rules, you can set the Apply Critical Term Match attribute in Customizing under: Treasury and Risk Management  Transaction Manager  General Settings  Hedge Accounting for Positions  Define Hedging Profiles. When you use this attribute, the critical term match is applied automatically. In this case, the aligned value check result at the release of hedge business transactions is set to Actual Value = Aligned Value.     The relevant financial transaction is valuated and posted on designation date.  Valuation Transfer postings are made from the freestanding subpositions to the hedged subpositions or to the subpositions to be hedged. Before these transfer postings are made, the freestanding subpositions are valuated. Write-ups and write-downs in the security are written to position component 1002 (Security Valuation).   Note In the hedging profile, you can set the Skip Valuation at Contract Date indicator if you want to prevent the posting of the first-day valuation result of the hedging instrument. When this indicator is set, the valuation is skipped during the release of hedging business transactions if the designation date is the same as the contract date.The elements and components are still calculated and stored in the market data container on the designation date. On the designation date, however, the values for the hedging instrument and the hypothetical derivative are assumed to be 0. Note Once postings for objects of the hedging relationship have been made, regardless of whether they result from period-end closing or from closing a financial transaction, the status of the hedging relationship cannot be changed back to a planned designation. This is only possible after all the relevant postings have been reversed.   The amounts of the planned flows for designation are updated.   The status of the planned flows for the designation is changed from Scheduled to Fixed.   The status of the hedging relationship is set to Designated.    Process Steps Executed at Release of Hedging Relationship Swap Transfer For more information about the process steps executed at the release of an FX swap transfer, see Release Hedging Business Transactions - FX Swap Transfer.  Process Steps Executed at Release of Reclassification   The hedge accounting key figures are determined based on the settings made in the respective hedge accounting calculation type.   The elements and contract rate components are calculated once you release the reclassification, and they are then stored in the market data container.    The market value components are calculated when you release the reclassification and then again at period end during the NPV calculation.   For more information, see Hedge Accounting Key Figures   The selected hedging relationship is classified with the actual market value components, and the results are posted.   The amounts of the planned flows for reclassification are updated.   The status of the planned flows for the reclassification is changed from Scheduled to Fixed.    Process Steps Executed at Release of Dedesignation The following process steps are executed at release of dedesignation:   The hedge accounting key figures are determined based on the settings made in the respective hedge accounting calculation type.   The elements and contract rate components are calculated once you release the dedesignation, and they are then stored in the market data container.    The market value components are calculated when you release the dedesignation and then again at period end during the NPV calculation.   For more information, see Hedge Accounting Key Figures   The selected hedging relationship is classified with the actual market value components, and the results are posted.   The amounts of the planned flows for dedesignation are updated.   The status of the planned flows for the dedesignation is changed from Scheduled to Fixed.   The status of the hedging relationship is set to Dedesignated.   
Business roles: Treasury Accountant| Treasury Specialist - Back Office
Treasury Specialist - Back Office : 
Processes financial transactions, sends confirmation to counterparties, imports market data and runs the valuation.

Treasury Accountant : 
Makes postings in accounting to reflect treasury activities.