The independent auditor of the Troubled Asset Relief Program is questioning the Treasury Department's arithmetic as it relates to the government's projected losses on its investment in American International Group.

In a report released last week, the government watchdog questioned the "dramatic shift" from the $45 billion loss on its AIG investment just six months ago to a newly projected loss of $5 billion in recent weeks.

In the report, the Special Inspector General of TARP, Neil Barofsky, said, "While AIG's fortunes may have indeed improved during the course of those six months, there is a serious question over how much of this decrease is from a change in the Treasury's methodology for calculating losses as opposed to AIG's improved prospects."

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