Then they hid the side letters from auditors and reported those sales as complete, violating accounting rules.

"We were delighted to receive a favorable opinion" from auditors about the company's financial controls, he said.

All councils will have to respond in public to criticism from auditors.

The side letters were then hidden from auditors and the transactions were reported as sales.

"Underwriters perform a different function from auditors," the judge wrote.

Instead of awaiting the rare question from outside auditors, he said, Berkshire's audit panel this year raised its own questions.

At the end of the year, he said, they hid the fraud from auditors using accounting tricks.

Ms. Nolan said she had not heard any such complaints from auditors.

That letter was concealed from auditors and the division accountant, according to the indictment.

But he said comments from companies and auditors would be needed to determine if enough had been done.