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Warren Buffett, in his first annual letter<\/a> to shareholders since Charlie Munger\u2019s death, credited his longtime partner for \u201cbeing the architect\u201d of Berkshire Hathaway<\/a>.<\/p>\n Munger, who passed away in late November, became vice chairman at the conglomerate in 1978. But well before then, he was providing crucial advice about running the company.<\/p>\n Buffett wrote that in 1965, Munger told him to \u201cforget about ever buying another company like Berkshire,\u201d but now that he had control of it, to \u201cadd to it wonderful businesses purchased at fair prices and give up buying fair businesses at wonderful prices.\u201d\u00a0<\/p>\n Buffett followed his instructions.<\/p>\n After Munger joined Berkshire, he repeatedly \u201cjerked me back to sanity when my old habits surfaced,\u201d Buffett wrote. \u201cUntil his death, he continued in this role and together we, along with those who early on invested with us, ended up far better off than Charlie and I had ever dreamed possible.\u201d<\/p>\n Aside from advising Buffett, Munger also made key decisions that turbo-charged Berkshire\u2019s success. His best call, he said a year ago<\/a>, was an investment in the Chinese automaker BYD<\/a>, which recently overtook Tesla<\/a> in global sales of electric vehicles.<\/p>\n After backing BYD at Munger\u2019s urging, Berkshire watched the value of its 2008 investment in the carmaker surge from $230 million to\u00a0$9.5 billion 14 years later.<\/p>\n \u201cI have never helped do anything at Berkshire that was as good as BYD,\u201d Munger said<\/a> during the annual meeting at the Daily Journal Corp., where he served as a director.<\/p>\n Munger was also known for his colorful language and candid remarks. He called Bitcoin \u201crat poison\u201d and likened other\u00a0cryptocurrencies to a type of \u201cvenereal disease.\u201d Last year, he wrote in the Wall Street Journal<\/em> that the federal government should ban<\/a> the entire industry, describing a cryptocurrency as \u201ca gambling contract with a nearly 100% edge for the house.\u201d\u00a0<\/p>\n Buffett suggested that Munger\u2019s role at Berkshire was far more important than most outsiders realized.\u00a0<\/p>\n \u201cIn reality, Charlie was the \u2018architect of the present Berkshire, and I acted as the \u2018general contractor\u2019 to carry out the day-by-day construction of his vision,\u201d Buffet wrote.\u00a0<\/p>\n He added, \u201cCharlie never sought to take credit for his role as creator but instead let me take the bows and receive the accolades. In a way his relationship with me was part older brother, part loving father. Even when he knew he was right, he gave me the reins, and when I blundered he never\u2014never\u2014reminded me of my mistake.\u201d<\/p>\n Later in the letter, Buffett bemoaned the dearth of worthwhile acquisition targets, noting that<\/a> the mere \u201chandful\u201d of U.S. firms capable of moving the needle for Berkshire \u201chave been endlessly picked over by us and by others.\u201d<\/p>\n In the meantime, however, Berkshire\u2019s cash hoard grew to a record $167.6 billion in the fourth quarter.\u00a0<\/p>\n<\/div>\n\nSubscribe to the CFO Daily newsletter to keep up with the trends, issues, and executives shaping corporate finance. Sign up<\/a> for free.<\/div>\n