Berkshire reported an $821 million insurance underwriting loss for the quarter, compared to a gain of $226 million a year ago. Total insurance income was $131 million compared to $1.2 billion in the 2010 first quarter.

Berkshire also reported investment and derivative losses of $82 million in the quarter, compared to gains of $1.4 billion in the 2010 first quarter.

The company released questions and answers from its Annual Shareholders Meeting that related to the recent resignation of David Sokol.

Sokol resigned a month ago after it was learned he made stock trades in chemical company Lubrizol before Berkshire announced its $9 billion acquisition of the company. Sokol had been chairman of Berkshire's MidAmerican Energy, NetJets and Johns Manville units

Berkshire CEO Warren Buffett says Sokol violated Berkshire's insider-trading rules as well as principles Buffett outlines every two years in letters to managers.

Buffett notes that Sokol has a net worth “in very high numbers” and earned $24 million from Berkshire last year. He adds that in 1999, Sokol was eligible for $50 million as part of a special compensation arrangement for him and a partner of his, Greg Abel, relating to an acquisition at the time. Sokol had said the compensation should be split evenly with Abel at $37.5 million apiece, rather than $50 million for Sokol and $25 million for Abel.

“So I witnessed…Dave voluntarily…transfer over $12.5 million, getting no fanfare, no credit whatsoever, to his, in effect, junior partner,” Buffett says. “And I thought that was rather extraordinary, and what really makes it extraordinary is that $3 million…10 or so years later would have led to the kind of troubles that it's led to.”

Buffett says when Sokol told him about Lubrizol, Sokol mentioned that he owned shares in the company and believed it would be a good fit for Berkshire. Buffett says he “obviously made a big mistake” by not asking Sokol when he bought shares in Lubrizol, but he says he did not suspect at the time that the shares had been purchased just the previous week.

Asked about the company's succession plans in the wake of the Sokol resignation, Buffett says, “I think the odds of us making a mistake are very, very low.”

He says of the person he believes to be the leading candidate to replace him, “I would lay a lot of money on the fact that he is straight as an arrow.”

“But,” he acknowledges, “mistakes can be made. You know, the Bible says the meek shall inherit the earth, but the question is, will they stay meek?”

He says he supports the idea of having a separate chairman and CEO, noting that it is “not an easy job to displace a sitting CEO who also holds the chairman's position and controls the agenda and all of that.

“So I think an independent chairman, particularly one that represents a very large block of stock and has no designs himself on taking over the place, is a safety measure for the possibility, however remote, that the wrong decision is made.”