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The shareholders of Berkshire Hathaway may have been seeing glimpses into the future without Buffett for some time now. Most of the deals that Berkshire Hathaway made last year were not directly involving the 82-year-old billionaire investor. They either started with one of the two investment managers Buffett recently hired over the last few years, or they started with one of the subsidiaries. No matter what way you look at it, Berkshire Hathaway did quite well during 2012.

Buffett will release his annual letter to shareholders this Friday afternoon, which is later on today.

The author of Warren Buffett’s Successor: Who It Is and Why It Matters, Jeff Matthews, tells us that last year’s deals are very comforting because they show how Berkshire Hathaway could work once Buffett is no longer there.

“It’s very reassuring. This didn’t used to happen,” said Matthews.

The main thing shareholders will miss most about Warren Buffett is his fantastic judgment and excellent connections. Take the 23.3 billion dollar deal to purchase a portion of H.J. Heinz, a Pittsburgh-based company.

No matter what kind of deal is being made by Berkshire Hathaway, the annual letter written by Warren Buffett is possibly the best read document throughout the entire business world. This is all because of his incredible record of accomplishment and his excellent ability to explain complicated matters in plain English.

There’s no question that shareholders are wondering about the future of the former textile manufacturer known as Berkshire Hathaway. Buffett is getting up there in years. He also recently suffered from prostate cancer, although it wasn’t life-threatening and he seems to have gotten through it quite nicely.

Some of the biggest dollar value deals Berkshire Hathaway made last year are:

Repurchasing $1.2 billion worth of Berkshire Hathaway Class A shares and purchasing $1.5 billion in mortgage loans from Residential Capital.

They also made a $4 billion deal to cover CIGNA Corp.’s insurance losses, and received a $2.2 billion premium in exchange.

Other deals were made but the terms have not been disclosed. Analysts tell us that the Oriental Trading Co. acquisition, as well as the Prudential real estate network will not likely be a major boost to Berkshire Hathaway’s bottom line by themselves.

The only Berkshire Hathaway deals that Warren Buffett likely initiated are the share repurchase acquirement, the acquisition of Oriental Trading Co. and potentially the deal with CIGNA. The rest of the deals started elsewhere. But there’s no question that Warren Buffett signed off on each and every one of them.

Buffett seems to enjoy all of the speculation revolved around who will eventually run the company. Meyer Shields, KBW analyst, said that Buffett probably won’t help narrow down the competition because of his enjoyment of the speculation.

If you follow the company as an investor, you might look upon these four people as the strongest potential candidates: Greg Abel, CEO and President of MidAmerican; Burlington Northern Santa Fe CEO Matt Rose; Ajit Jain, head of the Berkshire Hathaway reinsurance division; and CEO of Geico, Tony Nicely.

Buffett told us that his son Howard, also a member of the Berkshire Hathaway board, is ideally suited as the company chairman.

Berkshire Hathaway also hired two hedge fund managers, Ted Weschler and Todd Combs, who will eventually be able to run the entire Berkshire Hathaway portfolio. They each manage portfolios worth around $4 billion. Buffett continues to make the majority of the investments on behalf of Berkshire Hathaway as he searches for large acquisitions.

It’s always very popular to check in on Warren Buffett during the new year for whatever reason. One of the reasons is that many people potentially want to invest like Warren Buffett, and they make it a New Year’s resolution. That’s at least one potential reason why this happens. So how’s Buffett doing anyway?

Warren Buffett’s big bet on Bank of America, as well as a very generous buyback plan put into place, helps Berkshire Hathaway beat the S&P 500 index during 2012. He didn’t even make a major acquisition during this time.

Berkshire’s class a shares rose by 17% during 2012, and this beat out the 13% gain that the Standard & Poor’s 500 made. As well, an estimate made on December 31, 2012, says that book value rose to $113,579 per share. This estimate comes from Meyer Shields, who is an analyst at Stifel Nicolaus and Co. Based on this estimate, Berkshire Hathaway has earned a seven-point percent annual growth rate over the last five years ending in 2012. This is compared to the 1.7% growth rate of the S&P 500, and this includes dividends.

It’s also worth paying attention to that the Warren Buffett buyback was controversial when it was first announced just three weeks ago. But, the stock rose 6.5% since that time, earning Mister Buffett and company a $80 million profit in just three weeks.

Berkshire Hathaway also made a very large sum of money in their Bank of America investment in preferred shares and warrants during the year 2011. If you take a look at this passage from “Heard on the Street” where they go on about whether or not Bank of America should buyback the preferred stock from Buffett, you might learn some clues. Here’s why:

“Granted, retiring Mr. Buffett’s preferred shares might cause BofA to cut back on plans to ask for capital returns. That could cause unease for common shareholders, especially since Mr. Buffett’s preferred stock is also equity.

Yet the particular structure of the preferred shares means it doesn’t qualify toward the bank’s Tier 1 ratio under the new Basel rules. So it is akin to debt for capital purposes.

On that basis, 6% is expensive. The average yield on BofA’s long-term debt as of the third quarter was 3.07%. And the bank, awash with deposits, has been aggressively reducing long-term debt as it seeks to bolster its net interest margin.

So it wouldn’t be tough for BofA to replace Mr. Buffett’s preferred stock with cheaper, long-term debt. The catch: Any additional debt issuance chips away at the bank’s net interest margin, while the preferred payment doesn’t because it is deducted from net income.”

There is a very funny video on the Internet where Bill Ackman is talking about how he is going to open up a lemonade stand, and he mentions a fun exercise where he will try to explain exactly what it is that Bank of America is thinking about. But you really have to have financial knowledge in order to understand some of the terms that he’s talking about within the video. Some of the things being mentioned are: is Bank of America trying to bolster its net interest margin, or its tier 1 capital, or is it just looking to buy low and sell high?

If you have an a B Warren Buffett, you might wonder something like this: is buying the preferred shares a very good deal economically, when you compare to other things that Bank of America might choose to do with its money instead?

When reading the journal, you can’t get the sense that that isn’t a question they are going to be asking themselves anytime soon. But that doesn’t mean Bank of America is any less smarter than Warren Buffett. They just happen to be in the middle of many different accounting knots and regulatory tangles, and they can only unravel these issues one or two at a time. Mister Buffett on the other hand is a regulatory regime unto himself.

When looking at this from the perspective of Warren Buffett, the motives of Bank of America by trading their preferred shares to him are pleasantly uneconomic for the bank. The initial trade was actually conceived in a bathtub, and looking at it from an economic standpoint, this is a pretty big gift to Buffett. They give off the vibe of they are not going to vanish anytime soon.

So all in all, it looks like Warren Buffett really made out like a bandit on this deal. That doesn’t surprise me at all, since he was able to make hundreds of billions of dollars for himself and his clients over the years. This is nothing new, so why would anybody think otherwise?

Berkshire Hathaway Inc. is set to post and report its largest year over year increase in book value per share since the year 2010. This happened because of gains in equity derivative bets that Warren Buffett made, operating business earnings and other investments.

Book value is a measure of assets minus liabilities, and in regards to Berkshire Hathaway, it has risen at least 15% to the amount of $111,546 per share as of September 30 of this year. We learn this estimation from Jay Gelb, one of the analysts at Barclays PLC.

Cliff Gallant of KBW Inc. puts his estimation in at $110,701 per share as of the end of the third quarter. Berkshire Hathaway, based out of Omaha Nebraska, will report the overall book value numbers when it releases its earnings report at the close of the market on Thursday, November 1, 2012.

“This year, this quarter, the equity portfolio has done pretty well, and that’s helped,” said Gallant during a phone interview. It’s also expected that Berkshire Hathaway’s derivatives book will report gains during this period, as well as steady operating businesses, according to Gallant.

The 82 year old Warren Buffett regularly highlights this metric on the first page inside of the Berkshire Hathaway annual report. He tells us that book value is the best available proxy to determine intrinsic value. It also reflects any changes made in the company’s investment portfolio, plus it reflects earnings of the more than 80 businesses that Berkshire Hathaway personally operates, including electricity companies, hauling freight and selling products from candy to underwear.

“Book value is a number you can hold on to,” we learned from Meyer Shields, a Stifel Nicolaus & Co. analyst who estimates the Berkshire Hathaway book value to reach $110,490 within the quarter. “It’s a reasonable – ish depiction of what the market thinks Berkshire is worth.”

Berkshire Hathaway Class A shares have gone up 13% this year to $129,505, which we compare to the 12% gain of the Standard & Poor’s 500 index.