BENJAMIN MOORE & CO. DEFERRED SAVINGS AND INVESTMENT PLAN
Notes to Financial Statements
December
31, 2019 and 2018
NOTE D - TERMINATION OF THE
PLAN
The Company expects and intends to continue the Plan indefinitely but reserves the right to amend or terminate the Plan at
any future date. However, no such amendment or termination shall affect the account balance of any participant as of the date such amendment or termination takes effect.
NOTE E - TAX STATUS
The IRS has determined and informed the Company by letter dated August 23, 2017 that the Plan and related trust are designed in accordance with
applicable sections of the Internal Revenue Code (IRC). The Plan has been amended since receiving the tax determination letter. The Company believes that the Plan is designed and currently being operated in compliance with the applicable
requirements of the IRC. Therefore, no provision for income taxes has been provided in the Plans financial statements and the Company believes the Plan is qualified, and the related trust is tax-exempt.
Accounting principles generally accepted in the United States of America require the Company and Plan to evaluate tax positions taken by the Plan
and recognize a related tax liability (or asset) if the Plan has taken an uncertain position that more likely than not would not be sustained upon examination by a government authority. Plan management has analyzed the tax positions taken by the
Plan, and has concluded that as of December 31, 2019, there are no uncertain positions taken or expected to be taken that would require recognition of a liability (or asset) or disclosure in the financial statements. The Plan is subject to
routine examinations by taxing jurisdictions; however, there are currently no examinations for any tax periods in progress.
NOTE
F RELATED PARTY AND PARTIES-IN-INTEREST TRANSACTIONS
For the year ended December 31, 2019, there were transactions involving the investment of Plan assets in investments funds maintained by
Schwab, which qualify as party-in-interest transactions. As of December 31, 2019, the total fair value of these investments was $62,375,064. Fees paid by the Plan
to Schwab for administrative fees were $63,268 for the year ended December 31, 2019.
The Plan has investments in its Parents common
stock, which is accumulated in an investment account labeled the Berkshire Hathaway Stock Fund. This fund, which qualifies as party-in-interest transaction also has a
cash component of $1,163,962 and $1,559,806 as of December 31, 2019 and 2018, respectively. At December 31, 2019, the Berkshire Hathaway Stock Fund held 117,020 shares of Berkshire Hathaway Class B Common Stock, which had a
market value of $26,505,177. At December 31, 2018, the Berkshire Hathaway Stock Fund held 129,660 shares of Berkshire Hathaway Class B Common Stock, which had a market value of $26,473,388. The net realized/unrealized appreciation in fair
value of Parent common stock held by the Berkshire Hathaway Stock Fund was $2,763,410 for the year ended December 31, 2019.
As of
December 31, 2019 and 2018, the outstanding notes receivable from Plan participants were $4,493,198 and $4,357,181, respectively. Participants are a
party-in-interest to the Plan and these loans were exempt party-in-interest transactions
pursuant to Section 408(b)(1) of ERISA.
Note G Risks and Uncertainties
The Plan invests in various investment securities. Investment securities are exposed to various risks, such as interest rate, market and credit risks.
Due to the level of risk associated with certain investment securities, it is at least reasonably possible that changes in the values of investment securities will occur in the near term, and that such changes could materially affect the
participants account balances and the amounts reported in the statements of net assets available for benefits.
Volatility in the financial
markets may significantly impact the subsequent valuation of the Plans investments. Accordingly, the valuation of investments at December 31, 2019 may not necessarily be indicative of amounts that could be realized in a current market
exchange.