NEW YORK (Fortune) -- Running what is in effect an ad for talent, Berkshire Hathaway chairman Warren Buffett, 76, says in the company's just-released annual report that he plans to hire a younger person - or perhaps more than one - to understudy him in managing Berkshire's investments.

Buffett hopes to find, he says, a candidate to "succeed me as Berkshire's chief investment officer when the need for someone to do that arises."

In the same section of the annual report, Buffett writes, "I feel terrific and, according to all measurable indicators, am in excellent health." Jesting about his infamous non-diet, he adds, "It's amazing what Cherry Coke and hamburgers will do for a fellow."

Buffett says the plan to hire an investment manager was discussed fully at Berkshire's October board meeting and recognizes that the company's succession plans on the investment side of its business are not well-developed.

In contrast, he says, repeating a statement he has made previously, Berkshire has three outstanding candidates - all much younger than he - to replace him as CEO. The board, he writes, "knows exactly who should take over if I should die tonight."

Picking the right person to hire on the investment side will not be easy, Buffett says. "We need someone genetically programmed," he specifies, "to avoid serious risks, including those never before encountered." Other talents he will be looking for, he says, are "independent thinking, emotional stability, and a keen understanding of both human and institutional behavior."

Buffett adds that Berkshire will face a special problem in keeping the person it hires. "Being able to list Berkshire on a resume," he says, "would materially enhance the marketability of an investment manager. We will need, therefore, to be sure we can retain our choice, even though he or she could leave and make much more money elsewhere."

Buffett mentions Lou Simpson, 70, who has managed the investments of Berkshire subsidiary GEICO for more than 25 years and whom Buffett sees as his investment backstop right now, as the type of person Berkshire would hope to hire. Buffett says that though Simpson "has earned large amounts," he could have left long ago for a much more lucrative spot if "money alone had been the object." Says Buffett: "We need to find a younger person or two made of the same stuff."

Buffett says that he will be helped in his search for someone to hire by Simpson and by Berkshire's vice-chairman, Charles Munger. At the end of 2006, Berkshire had $61 billion in equity investments; $28 billion in fixed-income securities; and cash holdings of $43 billion.

___________________

Buffett: Major additions to stock holdings

Buffett tells charities, Spend my money fast