The purpose of the flight was for the examiner to conduct an examination of the assistant chief flight instructor applicant in a helicopter. The last maneuver that they were testing for the day was an engine failure on takeoff. The examiner assumed control of the helicopter from the flight instructor and began the takeoff. He asked the flight instructor to guard the flight controls before he announced a simulated engine failure and initiated the glide phase of the autorotation. When the examiner attempted to arrest the rate of descent by increasing engine power, he was unable to stop the helicopter prior to it impacting the ground. During the landing the helicopter’s skids and fuselage were substantially damaged. The pilots reported no preimpact mechanical malfunctions or failures with the helicopter that would have precluded normal operation.