Warren Buffett could not have been too pleased by the massive $938 million writedown that his holding company, Berkshire Hathaway, was forced to take at the urging of the Securities and Exchange Commission.
The company needed to write down the value of its investment holdings in three different companies—Swiss Reinsurance Co., Sanofi-Aventis, and U.S. Bancorp—at the end of last year under the accounting rules governing impaired assets.
CFO Marc Hamburg even wrote to an SEC official, Gus Rodriguez, to try to persuade the SEC that Berkshire believed the market prices would recover, according to
Accounting rules, as usual, are open to interpretation, especially when you want to keep the writedowns below the $1 billion mark.