The Williams Companies, Inc.
Williams Communications Group, Inc.

November 29,1999

Jonathan Katz
Secretary, U.S. Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549-0609

Re: SEC Proposed Rule for Audit Committee Disclosure, File No. S7-22-99

Dear Mr. Katz:

I am writing on behalf of The Williams Companies, Inc. and Williams Communications Group, Inc., each of which is a public company whose common shares are listed on the New York Stock Exchange. We appreciate this opportunity to comment on the Commission's proposal to require additional disclosure related to audit committees.

While we support the Commission's goal of enhancing the reliability and credibility of financial statements of public companies, we are concerned that several of the proposals may have the practical effect of subjecting audit committee members to an increased risk of litigation and personal liability and therefore of discouraging qualified individuals from accepting or continuing appointments to audit committees. To the extent potential members of audit committees are discouraged from accepting such assignments, the net result will be detrimental to the goal of enhancing the reliability of credibility of financial statements.

The Audit Committee Report

We believe that the "negative assurance" requirement of proposed Item 306(a)(4), particularly when taken together with the NYSE's proposed financial literacy requirements, will be argued by litigious plaintiffs to have raised the responsibility of audit committee members for the integrity of a company's financial statements to that of experts on a par with the responsibility of company management and outside auditors. We do not believe that audit committee members should be put in a position where they could be charged with this level of responsibility. We also believe that only a company's management and its outside auditors have the requisite in-depth understanding of the company's financial situation and accounting expertise to fulfill this kind of responsibility.

The Audit Committee Charter

We believe that developing an audit committee charter can be a helpful means for an audit committee to establish a set of goals and priorities for conducting the work of the committee, including its expectations of how company management and the outside auditors will work with the committee in assuring the integrity of the company's financial statements and reporting systems. We also believe, however, that the practical effect of proposed Item 7(e)(3) may be argued by litigious plaintiffs to elevate the charter to the status of a legal commitment compliance with which would have to be defended in court. This would particularly be the case were there to be a requirement to disclose any failure to comply with the charter. We submit that as a consequence the proposal will drive committees either not to establish a charter or to devise one that is as generic as possible.

Safe Harbor

We note that in making its proposal the Commission has stated that it does not intend for the proposal to subject companies or their directors to increased exposure to liability under the federal securities laws or to create new fiduciary standards for directors under state corporation law. We do not believe, however, that the proposed safe harbor goes far enough to implement this statement of intention.

With the safe harbor limited to some but not all of the new disclosure requirements, we believe that there will inevitably be litigation over the proper interpretation of those provisions not included within the safe harbor. We therefore suggest that the safe harbor include all of the new disclosures. We also suggest that the Commission's intention would be furthered by including the statement of intent within the new rules themselves instead of only in the accompanying release. Finally, we believe that it would be appropriate for the Commission to make violations of the new rules subject only to enforcement action by the Commission but not to private actions.

Respectfully submitted,

Shawna L. Gehres