Global insurance titan American International Group has revealed that it is to put off filing its obligatory annual report until the end of April because it has not completed its internal investigations into accounting problems.
Meanwhile, in a significant development, the insurer has stated that it has discovered improper documentation relating to transactions undertaken with Berkshire Hathaway Inc.
Berkshire Hathaway’s relationship with AIG has been at the center of US authority investigations into unlawful practices. The admittance is the first time AIG has accepted improperly recording dealings with Hathaway as insurance transactions.
In a statement explaining the delay in filing AIG said: because AIG’s review is not yet complete, AIG is not yet able to determine whether the adjustments identified to date as a result of the review will require restatement of prior period results or an adjustment to fourth quarter 2004 published unaudited information. Therefore, AIG is not currently able to determine the potential effects of any proposed adjustment on AIG’s results of operations for any particular period.
The investigations and AIG’s review are continuing, and AIG cannot presently determine whether additional matters will be discovered or further adjustments will be required.
AIG’s statement also referred to other accounting problems including the acknowledgement that Richmond Insurance Company of Bermuda was not an independent entity but a subsidiary of AIG and that transactions totaling $200 million with Capco Reinsurance Co were improper and needed recharacterizing.