Buffett: Cued in

New York, Aug. 7 (Reuters): Warren Buffett’s Berkshire Hathaway Inc, whose General Re Corp unit has been investigated over its role in helping insurer American International Group Inc misstate results, said government authorities were inquiring about some of its own accounting.

In its quarterly report filed on Friday with the US Securities and Exchange Commission, Berkshire said the authorities were looking into the accounting by some of its insurance subsidiaries for finite reinsurance.

Investigators have for several months in an industrywide probe been questioning whether such non-traditional reinsurance products can be used to mask losses or smooth earnings.

Berkshire, based in Omaha, Nebraska, also said the government authorities are questioning whether General Re or its subsidiaries “conspired with others” to misstate financial statements.

The disclosures suggest that investigators may be widening their probe beyond General Re’s role in a 2000 reinsurance contract that helped AIG improperly increase reserves by $500 million. Two former General Re executives in June pleaded guilty to conspiracy charges in the matter.

“I suppose regulators are simply being thorough, and seeing if Berkshire accounted for something different from how its counterparties did,” said Steven Check, who oversees $470 million at Check Capital Management Inc in Costa Mesa, California, including $45 million in Berkshire shares. “Warren Buffett has done things right for decades, so for me the benefit of the doubt should go to him,” he added.

Berkshire was not immediately available for comment.

The company also disclosed that Milan Vukelic, the chief executive of Faraday Group, a British unit of General Re, was fired in July, two months after being placed on leave.

British regulators have investigated Vukelic over transactions in 1998 between General Reinsurance Australia Ltd and affiliates of FAI

Insurance Ltd. FAI was acquired the following year by HIH Insurance Ltd, Australia's No. 2 general insurer, which became insolvent in 2001. Vukelic once ran General Re's international finite reinsurance business unit.

Among other regulators examining activities involving Berkshire units are federal prosecutors, the SEC, New York Attorney General Eliot Spitzer, and regulators in Australia, Canada, Germany and Ireland.