At AIG’s annual meeting, one upset shareholder pointed out how much PwC, the insurer’s independent auditor, had been paid over the past two years. 

AIG paid PwC a total of $131 million in audit and other fees in 2008 and $119.5 million in 2007. 

“I want to know what these fees were paid for,” shareholder Kenneth Steiner of Great Neck, New York said. “Why didn’t anybody know what was going on? What were the accountants doing? Were they sleeping?”

The fees look large but are not unheard of.  GE, for instance, paid KPMG $133 million in 2008 and $122.5 million in 2007.

Still, Microsoft paid its auditor, Deloitte & Touche, a fraction of that — only $27.9 million in 2008 and $23.5 million in 2007.

AIG CEO Edward Liddy defended PwC, saying the auditor had raised early concerns about controls at the division blamed for AIG’s near collapse — AIG Financial Products. 

“PricewaterhouseCoopers conducted itself well over the last couple of years,” Liddy said. “They put a material weakness on the company with respect to its controls around FP (AIG Financial Products).”