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Nobody Seems to Care About Williams Companies’ $497 Million Accounting Error

Bloomberg's Jonathan Weil likes digging through dirty laundry. If you're an auditor, the PCAOB, a TBTF bank or in today's case, a natural gas producer, playing games that just so happen to cross his radar and it insults his intelligence, you can expect JW to open up your ringer of dirty undies for all of us to see. Today, Williams Companies of Tulsa, Oklahoma gets the pleasure:

One telltale sign of a bull market is that investors don't care as much about dodgy corporate accounting practices. A case in point: the public reaction — or lack thereof — to a financial restatement disclosed late yesterday afternoon by Williams Cos., the natural-gas producer. Williams didn't issue a press release about the restatement. As far as I can tell, there have been no news reports about the company's accounting errors, which Williams divulged in a filing with the Securities and Exchange Commission. They aren't a small matter, though. As a result of the restatement, Williams said its shareholder equity fell $497 million, or 28 percent, to $1.3 billion as of Dec. 31. Additionally, the company said it had "identified a material weakness in internal control over financial reporting," which is never a good sign.
For those keeping score, Ernst & Young is your auditor of record. Anyway, if you check out the filing, it tries very carefully to blow things off at first: 
The accounting correction reflected in the restated financial statements has no impact on our Consolidated Statement of Operations, Consolidated Statement of Cash Flows or previously announced earnings, cash flows and dividend guidance. The restated financial statements reflect an increase to our noncurrent deferred income tax liability and a corresponding decrease to capital in excess of par value for all periods presented. This increase to our deferred income tax liability would only result in a current tax payable if we disposed of our investment interest in Williams Partners L.P. (“WPZ”). Management has stated that it has no intent to dispose of this investment.
Right, then. "[A] corresponding decrease to capital in excess of par value for all periods presented," sounds relatively harmless but later on things are little less euphemistic:
Though the accounting correction had no impact on our Consolidated Statement of Operations or Consolidated Statement of Cash Flows, the error was material to the Consolidated Balance Sheet and Consolidated Statement of Changes in Equity.
That's more like it! But hey, if that none of this bothers anyone – and judging by the markets, it doesn't – carry on.
 
8-K [SEC]