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The SEC questioned Berkshire Hathaway (BRK.A) during Q2 why it wasn't writing down large losses...

The SEC questioned Berkshire Hathaway (BRK.A) during Q2 why it wasn't writing down large losses on shares in Kraft (KFT) and US Bancorp (USB), but Buffett's company insisted its accounting was right. Today, Berkshire released a copy of its response; none of the other filings it disclosed on Monday indicate how the issue was resolved.
Comments (5)
  • dividend_growth
    , contributor
    Comments (2878) | Send Message
     
    Isn't the drop in stock price reflected on the balance sheet?

     

    If Buffett didn't sell those holdings, why should the losses be reflected on the income statement?

     

    I remember that when Buffett sold his COP holding, he took a $3 billion loss.
    25 Oct 2010, 03:34 PM Reply Like
  • elliotz
    , contributor
    Comments (251) | Send Message
     
    It all depends how it is accounted for. If it is accounted for as held for trading securities then the loss/gain must be reflected in the income statement on a quarterly basis but if it held to maturity then it does not have to be reflected on the income statement.
    25 Oct 2010, 04:24 PM Reply Like
  • Tony Petroski
    , contributor
    Comments (6373) | Send Message
     
    (Now I realize that the copy editor may be new)

     

    "why it wasn't writing down large losses on shares in Kraft (KFT) and US Bancorp (USB), but Buffett's company insisted..."

     

    Buffett is a made man. Got that right?

     

    (Full disclosure: I'm not that cynical, but I'm doihg what I can to help the anti-statists in the next election.)

     

    25 Oct 2010, 03:47 PM Reply Like
  • earl880
    , contributor
    Comments (137) | Send Message
     
    Has he always been this crooked? Or just since this latest crisis. Next thing we'll find out is he doesn't really like cherry Coke or Wendy's burgers. Sigh.
    25 Oct 2010, 05:09 PM Reply Like
  • elliotz
    , contributor
    Comments (251) | Send Message
     
    What a moronic comment!
    25 Oct 2010, 06:31 PM Reply Like
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