11-K 1 investment_plusxplan-11kx2.htm 11-K Investment_Plus_Plan-11K-2013

 
 
 
 
 
UNITED STATES
 
SECURITIES AND EXCHANGE COMMISSION
 
Washington, D.C. 20549
 
FORM 11-K
 
 
(Mark One)
 
(X) ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
 
For the fiscal year ended                                  December 31, 2013                    
 
   OR
 
( ) TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
 
For the transition period from                                                  to                         
 
Commission file number                                                          1-4174                   
 
A. Full title of the plan:
 
The Williams Investment Plus Plan
 
B. Name of issuer of the securities held pursuant to the plan and the address of its principal executive office:
 
The Williams Companies, Inc.
One Williams Center
Tulsa, Oklahoma 74172
 




THE WILLIAMS INVESTMENT PLUS PLAN

INDEX TO FINANCIAL STATEMENTS





Report of Independent Registered Public Accounting Firm

The Administrative Committee
The Williams Investment Plus Plan
We have audited the accompanying statements of net assets available for benefits of The Williams Investment Plus Plan as of December 31, 2013 and 2012, and the related statement of changes in net assets available for benefits for the year ended December 31, 2013. These financial statements are the responsibility of the Plan’s Administrative Committee. Our responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. We were not engaged to perform an audit of the Plan’s internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Plan’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by the Plan's Administrative Committee, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material respects, the net assets available for benefits of The Williams Investment Plus Plan at December 31, 2013 and 2012, and the changes in its net assets available for benefits for the year ended December 31, 2013, in conformity with U.S. generally accepted accounting principles.
Our audits were conducted for the purpose of forming an opinion on the financial statements taken as a whole. The accompanying supplemental schedule of assets (held at end of year) as of December 31, 2013, is presented for purposes of additional analysis and is not a required part of the financial statements but is supplementary information required by the Department of Labor’s Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. Such information has been subjected to the auditing procedures applied in our audits of the financial statements and, in our opinion, is fairly stated in all material respects in relation to the financial statements taken as a whole.

/s/ Ernst & Young LLP

Tulsa, Oklahoma
June 12, 2014



1


THE WILLIAMS INVESTMENT PLUS PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
December 31, 2013 and 2012




 
2013
 
2012
Assets:
 
 
 
Investments (at fair value)
$
1,014,728,054

 
$
851,778,228

Notes receivable from participants
17,745,898

 
16,390,886

Due from brokers
116,602

 
2,468

 
 
 
 
Total assets (at fair value)
1,032,590,554

 
868,171,582

 
 
 
 
Adjustment from fair value to contract
value for fully benefit-responsive
investment contracts
(1,350,965
)
 
(2,597,941
)
 
 
 
 
Net assets available for benefits
$
1,031,239,589

 
$
865,573,641

 
 
 
 
        
 

















See accompanying notes.

2

THE WILLIAMS INVESTMENT PLUS PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
Year Ended December 31, 2013



 
 
Additions to net assets:
 
   Contributions:
 
Participant
$
39,513,072

Employer
25,610,670

Rollovers
6,064,363

 Total contributions
71,188,105

 
 
   Net investment income:
 
Net increase in fair value of investments
135,391,759

Dividends
37,822,273

Interest
19,671

Investment expenses
(79,273
)
Total net investment income
173,154,430

 
 
   Interest income on notes receivable from participants
747,476

 
 
Total additions to net assets
245,090,011

 
 
Deductions from net assets:
 
Withdrawals
(79,382,199
)
Dividend distributions
(41,864
)
 
 
Total deductions from net assets
(79,424,063
)
 
 
Net increase during the year
165,665,948

 
 
Net assets available for benefits at beginning of year
865,573,641

 
 
Net assets available for benefits at end of year
$
1,031,239,589

 
 






See accompanying notes.

3
 
 
 
 
 
 
 
 
 
 
THE WILLIAMS INVESTMENT PLUS PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2013



Note 1--Description of plan

The information included below regarding The Williams Investment Plus Plan (the “Plan”) provides only a general description of the Plan. Participants should refer to the Plan document, as amended and restated, and Summary Plan Description for a more complete description of the Plan’s provisions.

General

The Plan is a defined contribution plan maintained for the benefit of substantially all employees of The Williams Companies, Inc. and its participating subsidiaries (collectively, “Williams” or “Employer”), excluding employees represented by certain collective bargaining agreements and certain other employees, as provided in the Plan. A small portion of the Plan is an employee stock ownership plan (“ESOP”) and includes shares of Williams common stock held in the Transtock and Williams Companies Employee Stock Ownership Plan (“WESOP”) Accounts, as defined in the Plan.

The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”). The Plan is intended to constitute a plan described in Section 404(c) of ERISA and Title 29 of the Code of Federal Regulation Section 2550.404c-1, and the fiduciaries of the Plan may be relieved of liability for any losses that are the direct and necessary result of investment instructions given by a participant or beneficiary.

Administration

The Administrative Committee is the Plan administrator. The Investment Committee has the responsibility to monitor the performance of the trustee, investment funds and investment managers, and select, remove, and replace the trustee, any investment fund and any investment manager. The Benefits Committee has the authority and responsibility for the implementation of actions required to be performed by such committee under ERISA (after taking into account the terms of the Plan and the Trust Agreement) with respect to overriding the terms of the Plan which require the availability of a fund consisting of common stock issued by The Williams Companies, Inc. unless such action relates to Section 404(c) of ERISA or such actions could be implemented by the trustee. The Benefits Committee, in its settlor capacity, may amend the Plan provided it is a non-material amendment as detailed in the Plan. Fidelity Management Trust Company is the trustee and record keeper. Additionally, Fidelity Investments Institutional Operations Company, Inc. provides certain other record keeping services for the Plan.


4
 
 
 
 
 
 
 
 
 
 
THE WILLIAMS INVESTMENT PLUS PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2013



Note 1--Description of plan (continued)

Contributions

Each eligible participant has an Employee Contribution Account, consisting of, as applicable, an After-Tax Account, a Pre-Tax Account, a Catchup Account, and a Rollover Contribution Account. Additionally, as applicable, each eligible participant has an Employer Contribution Account, consisting primarily of an Employer Matching Contribution Account and an Employer Cash Contribution Account. In addition, certain participants may also have a Bonus Employee Stock Ownership Plan (“BESOP”) Employer Contribution Account, a MAPCO Employer Matching Contribution Account, a Transtock Account, a WESOP account, a 2005 ERISA Settlement Account, a 2006 Securities Settlement Account, and a 2006 Salomon Settlement Account, as applicable.

The Pre-Tax Account is made up of amounts contributed from the participant’s pre-tax compensation. Each eligible employee participant may contribute from 1 percent to a maximum of 30 percent of their eligible compensation per pay period. The maximum percentage Highly Compensated Employees may contribute is a lower percentage as approved by the Administrative Committee. The maximum pre-tax contribution percentage is subject to periodic adjustment in order to meet discrimination testing requirements and certain annual maximum statutory limits imposed by the Internal Revenue Service (“IRS”). The Employer will contribute an amount equal to 100 percent of each participant’s contribution per pay period up to a maximum of 6 percent of their eligible compensation. In addition, the Plan allows for discretionary Employer contributions. No such discretionary Employer contributions were made in 2013.

Participants may elect to invest in various investment options, including a self-directed brokerage fund, provided they allocate their contribution in multiples of 1 percent and subject to certain other restrictions. A participant may change their investment election at any time. Participants may also exchange or rebalance any investment in their Plan account in accordance with the Plan’s investment provisions.

The Plan no longer allows participants’ contributions, including employer and employee contributions, loan payments, and rollovers to be made or invested in shares of Williams common stock. A small portion of Williams common stock continues to be held in the Transtock and WESOP Accounts within the Plan’s Legacy WMB Stock Fund. Dividend payments on Williams common stock not passed through to the participant continue to be reinvested in additional shares of Williams common stock until the participant elects to receive such dividends in cash.

5
 
 
 
 
 
 
 
 
 
 
THE WILLIAMS INVESTMENT PLUS PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2013



Note 1--Description of plan (continued)

Vesting

Participants have a nonforfeitable vested interest in the current fair value of the assets purchased with their contributions. Eligible participants become 20 percent vested in the employer contributions made on their behalf after one year of service as defined by the Plan. Such vesting increases an additional 20 percent for each year of service, and participants become 100 percent vested upon five years of service. In addition, a participant may become totally vested in their account by reason of their death, total and permanent disability, attainment of age 65, eligibility to receive early retirement benefits under a pension plan of Williams, reduction in work force, complete discontinuance of employer contributions, or termination or partial termination of the Plan. Upon certain sales of assets or companies, participants that have an involuntary termination of employment as a result of such sale are also 100 percent vested.

Generally, the payment of benefits under the Plan shall be made in cash, or if requested by the participant with respect to amounts held in the ESOP portion of the Plan, in Williams common stock, with the balance paid in cash.

Employer contributions that are not vested at the time a participant withdraws from the Plan by reason of termination of employment, other than permanent job elimination or permanent reduction in work force, are used for certain items as specified in the Plan document, including the reduction of future employer contributions and payment of Plan expenses.

Distributions and in-service withdrawals

Participants are entitled to receive the vested portion of their account when they cease to be an employee of Williams for any reason including retirement. Upon termination of service, a participant has distribution options available as outlined in the Plan.

Eligible employee participants may request a partial withdrawal from the Plan of their Rollover Contribution Account and a portion, as defined in the Plan document, of their Prior Plans After-Tax Account. Eligible employee participants may make two such withdrawals during any Plan year and are not suspended from participation in the Plan following such a withdrawal. Outstanding loans will reduce the amount available for partial withdrawals.

Eligible participants who have completed two years of service and who are employees may request an additional in-service withdrawal from the Plan. The amount available for this withdrawal is calculated as defined in the Plan, but in no event shall it exceed the vested portion of the participant’s Employer Matching Contribution Account, Employer Cash Contribution Account, and the balance of the After-Tax Account. Outstanding loans will reduce the amount available for additional in-service withdrawals. Upon electing an additional in-service withdrawal, a participant


6
 
 
 
 
 
 
 
 
 
 
THE WILLIAMS INVESTMENT PLUS PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2013



Note 1--Description of plan (continued)

is suspended from participation in the Plan for three months. Only one such withdrawal may be made every 12 months.

A participant who is at least age 59½ may request a post-59½ withdrawal from the Plan. The withdrawal can include the vested portion of their Employer Contribution Account, Employee Contribution Account, MAPCO Employer Matching Contribution Account, and BESOP Employer Contribution Account. Outstanding loans will reduce the amount available for post-59½ withdrawals. Such withdrawal may be requested at any time and does not cause the participant to be suspended from the Plan.

An eligible employee participant who has a balance in a WESOP Account or a Transtock Account may withdraw such balance at any time. Such withdrawal does not cause the participant to be suspended from the Plan.

Withdrawals from an eligible employee participant’s Pre-Tax Account before age 59½ may be made if the participant is totally and permanently disabled or has suffered a financial hardship condition. Upon electing a financial hardship withdrawal, a participant is suspended from participation in the Plan for six months.

Participant loans

The Plan permits eligible employee participants to obtain up to two loans from their account balances within specified limitations. Participants may borrow from their fund accounts, a minimum of $1,000 up to a maximum equal to the lesser of $50,000 reduced by the aggregate of the highest outstanding balances of such loans during the immediately preceding 12-month period, or 50 percent of their vested balance. Loan terms may not exceed 58 months unless the loan is for the purchase of a primary residence, in which case the loan term may not exceed 25 years. Periodic principal and interest payments are reinvested according to the participant’s current investment election on file. The interest rate is equal to the prime rate of interest plus one percentage point or such other rate as the Administrative Committee shall specify. Principal and interest is paid ratably through payroll deductions. If the participant’s employment is terminated, the participant may continue to make principal and interest payments subject to certain limitations. Participants may make additional partial payments of the loan at any time and in such form as required by the record keeper.



7
 
 
 
 
 
 
 
 
 
 
THE WILLIAMS INVESTMENT PLUS PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2013



Note 1--Description of plan (continued)

Other

Each participant has their own individual account. Contributions and investment earnings are recorded to individual participant accounts. Plan investments are valued daily. The fair value per share of each fund is multiplied by the number of shares of the fund held in the participant’s account to arrive at their account balance.

Net investment income including the net change in fair value of investments, on assets held in allocated accounts is applied to the individual participant accounts based on each participant’s account balances.

The ESOP allows for the election of dividend pass-through, which are cash dividends paid directly to participants, for the dividends received on the shares of Williams' common stock in the Plan’s ESOP.

While the Compensation Committee of the Williams Board of Directors has not expressed any intent to terminate the Plan, it may do so, in its settlor capacity, at any time. In the event of any Plan termination, assets of the Plan will be distributed in accordance with the Plan document.

Note 2--Summary of significant accounting policies

Basis of accounting

The accompanying financial statements of the Plan are prepared on the accrual basis of accounting, except as indicated within this Note. Benefit payments are recorded when paid.

Notes receivable from participants

Notes receivable from participants are measured at their unpaid principal balance plus any estimated accrued and unpaid interest. No allowance for credit losses has been recorded as of December 31, 2013 or 2012. If a participant ceases to make loan repayments and the plan administrator deems the participant loan to be a distribution, the participant loan balance is reduced and a withdrawal is recorded.

Use of estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires the Plan’s Administrative Committee to make estimates that affect the amounts reported in the financial statements, accompanying notes, and supplemental schedule. Actual results



8
 
 
 
 
 
 
 
 
 
 
THE WILLIAMS INVESTMENT PLUS PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2013





Note 2--Summary of significant accounting policies (continued)

could differ from those estimates.

Risks and uncertainties

The Plan provides for various investment securities. Investment securities, in general, are exposed to various risks, such as interest rate, credit, and overall market volatility risk. Due to the level of risk associated with certain investment securities, it is reasonably possible that changes in the values of investment securities will occur in the near term and that such changes could materially affect the amounts reported in the Statements of Net Assets Available for Benefits and participants’ account balances.

Investment valuation and income recognition

The Plan’s investments are stated at fair value except for the investment in the Fidelity Managed Income Portfolio II Fund (“MIP II Fund”), a common/collective trust with fully benefit-responsive investment contracts, which is presented at fair value and adjusted to contract value
as reported to the Plan by the trustee (see Note 5). Contract value represents contributions, plus earnings, less participant withdrawals and administrative expenses. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A discussion of fair value measurements is included in Note 4.

Purchases and sales of securities are recorded on a trade-date basis, which may result in amounts due to or from brokers related to unsettled trades. Dividend income is recorded on the ex-dividend date. Net increase in fair value of investments includes the Plan’s gains and losses on investments bought and sold as well as held during the year.

Contributions

Participant contributions are recorded when Williams makes payroll deductions from eligible Plan participants. Employer contributions are accrued in the period in which they become obligations of Williams.

Administrative expenses

Certain administrative expenses, including audit fees, of the Plan are paid by Williams.


9
 
 
 
 
 
 
 
 
 
 
THE WILLIAMS INVESTMENT PLUS PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2013



Note 3--Investments
 
The following investments, at fair value, represent 5 percent or more of the Plan’s net assets available for benefits at December 31:

 
2013
 
2012
Fidelity Contrafund Class K
$
124,732,004

 
$
95,670,008

MIP II Fund*
95,973,792

 
95,795,311

Fidelity Freedom K 2020 Fund
94,541,383

 
78,353,363

T. Rowe Price Institutional Small-Cap Stock Fund
79,322,606

 
55,036,910

Fidelity Diversified International Fund Class K
77,960,368

 
64,670,327

Vanguard Institutional Index Fund
74,906,881

 
58,445,683

PIMCO Total Return Institutional Fund
66,095,979


81,199,608

Fidelity Freedom K 2030 Fund
60,365,143

 
46,626,552

Davis New York Venture Fund Class Y
56,845,033

 
44,674,140

Fidelity Puritan Fund Class K
53,145,582

 
47,110,875

    
*
The contract value of the MIP II Fund at December 31, 2013 is $94,622,827 and at December 31, 2012 is $93,197,370.
 
 

During 2013, the Plan’s investments (including gains and losses on investments bought and sold, as well as held during the year) increased in fair value as follows:

   Mutual funds
$
127,493,530

   Common stocks
7,911,534

   Other
(13,305
)
   
$
135,391,759




10
 
 
 
 
 
 
 
 
 
 
THE WILLIAMS INVESTMENT PLUS PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2013



Note 4--Fair value measurements

The fair value hierarchy prioritizes the inputs used to measure fair value, giving the highest priority to quoted prices in active markets for identical assets or liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3 measurement). Fair value balances are classified based on the observability of those inputs. The fair value measurement level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement.

The Plan’s Level 1 investments primarily consist of mutual funds, common stocks, and money market funds that are traded on U.S. exchanges. The Plan’s Level 2 investments primarily consist of the MIP II Fund. The Plan has no Level 3 investments.

The fair values of common stocks, including exchange-traded funds within various other equities, are derived from quoted market prices as of the close of business on the last business day of the Plan year. Shares of money market funds and mutual funds are valued at fair value based on published market prices as of the close of business on the last business day of the Plan year, which represent the net asset values of the shares held by the Plan. The units of the MIP II Fund are valued at fair value using the net asset value as determined by the issuer based on the current fair values of the underlying assets of the fund (see Note 5).

There have been no significant changes in the preceding valuation methodologies used at December 31, 2013 and 2012. Additionally, there were no significant transfers or reclassifications of investments between Level 1 and Level 2 during 2013. If transfers between levels had occurred, the transfers would have been recognized as of the end of the period.

The valuation methods described above may produce a fair value that may not be indicative of net realizable value or reflective of future fair values. Furthermore, although the Plan’s Administrative Committee believes the valuation methods are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine fair value of certain financial instruments could result in a different fair value measurement at the reporting date.












11
 
 
 
 
 
 
 
 
 
 
THE WILLIAMS INVESTMENT PLUS PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2013


Note 4--Fair value measurements (continued)

The following table sets forth, by level within the fair value hierarchy, the Plan’s assets that are measured at fair value as of December 31, 2013 and 2012.
 
Level 1
 
Level 2
 
Level 3
 
Total
2013:
 
 
 
 
 
 
 
Mutual funds:
 
 
 
 
 
 
 
Domestic equity funds
$
410,493,891

 
$
—

 
$
—

 
$
410,493,891

Target date funds
221,648,534

 
—

 
—

 
221,648,534

Fixed income funds
68,719,678

 
—

 
—

 
68,719,678

International equity funds
81,554,675

 
—

 
—

 
81,554,675

Balanced funds
53,145,582

 
—

 
—

 
53,145,582

Various other funds
17,181,785

 
—

 
—

 
17,181,785

Common stocks:
 
 
 
 
 
 
 
Williams common stock
18,542,539

 
—

 
—

 
18,542,539

Various other equities
32,528,952

 
—

 
—

 
32,528,952

Money market funds
14,302,761

 
—

 
—

 
14,302,761

MIP II Fund (see Note 5)
—

 
95,973,792

 
—

 
95,973,792

Other
397,671

 
238,194

 
—

 
635,865

Total investments at fair value
$
918,516,068

 
$
96,211,986

 
$
—

 
$
1,014,728,054

 
 
 
 
 
 
 
 
2012:
 
 
 
 
 
 
 
Mutual funds:
 
 
 
 
 
 
 
Domestic equity funds
$
305,581,329

 
$
—

 
$
—

 
$
305,581,329

Target date funds
177,246,921

 
—

 
—

 
177,246,921

Fixed income funds
84,878,208

 
—

 
—

 
84,878,208

International equity funds
66,210,345

 
—

 
—

 
66,210,345

Balanced funds
47,110,875

 
—

 
—

 
47,110,875

Various other funds
15,542,178

 
—

 
—

 
15,542,178

Common stocks:
 
 
 
 
 
 
 
Williams common stock
16,564,963

 
—

 
—

 
16,564,963

Various other equities
26,781,991

 
—

 
—

 
26,781,991

Money market funds
14,769,569

 
—

 
—

 
14,769,569

MIP II Fund (see Note 5)
—

 
95,795,311

 
—

 
95,795,311

Other
513,655

 
782,883

 
—

 
1,296,538

Total investments at fair value
$
755,200,034

 
$
96,578,194

 
$
—

 
$
851,778,228



12
 
 
 
 
 
 
 
 
 
 
THE WILLIAMS INVESTMENT PLUS PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2013



Note 5--Common/collective trust – Fidelity Managed Income Portfolio II Fund

Description and investment strategy of the MIP II Fund

The Plan holds an investment in the MIP II Fund, a common/collective trust. The MIP II Fund is a commingled pool managed by Fidelity Management Trust Company (“MIP II Fund Trustee”) as trustee. The MIP II Fund’s investment objective is to seek preservation of capital while providing a competitive level of income over time and to maintain a stable net asset value of $1.00 per unit. The MIP II Fund primarily invests in fixed income securities, including U.S. Treasury and agency bonds, corporate bonds, mortgage-backed securities, commercial mortgage-backed securities, and asset-backed securities, as well as bond funds and money market funds. The MIP II Fund may invest in derivative instruments, including futures contracts and swap agreements. Additionally, the MIP II Fund enters into wrap contracts with third-party issuers, such as financial institutions or insurance companies, normally rated in the top three long-term rating categories (A- or the equivalent and above). The wrap contracts are designed to allow the portfolio to maintain a constant net asset value and to protect the portfolio in extreme circumstances.

Restrictions on withdrawals and exchanges

Participant-directed withdrawals of MIP II Fund units may be made on any business day. Participant-directed exchanges to another investment option may be made on any business day as long as the exchange is not directed into a competing fund (money market funds or certain other types of fixed income funds). Transferred amounts must be held in a non-competing investment option for 90 days before subsequent transfers to a competing fund may occur. Withdrawals directed by a plan sponsor must be preceded by 12 months’ written notice to the MIP II Fund Trustee. The MIP II Fund Trustee may in its discretion complete any such plan-level withdrawals before the expiration of such 12-month period. Additionally, the MIP II Fund Trustee may defer completing a withdrawal directed by a participant or plan sponsor where doing so might adversely affect the MIP II Fund portfolio. The MIP II Fund Trustee shall make the payments available as quickly as cash flows and prudent portfolio management permit.

Note 6--Tax status and federal income taxes

The Plan has received a determination letter from the IRS dated September 1, 2011, stating that the Plan, as amended, is qualified under Section 401(a) of the Internal Revenue Code (the “Code”) and, therefore, the related trust is exempt from taxation. Subsequent to this determination by the IRS, the Plan was amended and restated. A request for determination of the continued qualification of the Plan has been filed with the IRS. The response is currently pending. Once qualified, the Plan is required to operate in conformity with the Code to maintain its qualified status. The Plan administrator believes the Plan is being operated in compliance with the applicable requirements of the Code and therefore, believes the Plan is qualified and the related trust is tax-exempt.

13
 
 
 
 
 
 
 
 
 
 
THE WILLIAMS INVESTMENT PLUS PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2013



Note 6--Tax status and federal income taxes (continued)

Plan management is required by generally accepted accounting principles to evaluate uncertain tax positions taken by the Plan. The financial statement impact of a tax position must be recognized when the position is more likely than not, based on its technical merits, to be sustained upon examination by the IRS. As of December 31, 2013, there are no uncertain positions taken or expected to be taken. The Plan has recognized no interest or penalties in relation to uncertain tax positions. The Plan is subject to routine audits by taxing jurisdictions; however, there are currently no audits in progress for any tax periods. Periods for which the Plan’s trust is no longer subject to income tax examinations related to the Plan’s Forms 5500 are considered closed for tax filing purposes.

Note 7--Differences between financial statements and Form 5500

The following is a reconciliation of net assets available for benefits per the financial statements to the Form 5500 at December 31:
 
2013
 
2012
Net assets available for benefits per the financial statements
$
1,031,239,589

 
$
865,573,641

Adjustment from contract value to fair value for fully
benefit-responsive investment contracts
1,350,965

 
2,597,941

Amounts allocated to withdrawing participants
(365
)
 
(2,468
)
Net assets available for benefits per the Form 5500
$
1,032,590,189

 
$
868,169,114


The following is a reconciliation of Net increase during the year per the Statement of Changes in Net Assets Available for Benefits to net income per the Form 5500 for the year ended December 31, 2013:

   Net increase during the year
$
165,665,948

   Less: Amounts allocated to withdrawing participants
      at December 31, 2013
(365
)
   Add: Amounts allocated to withdrawing participants
      at December 31, 2012
2,468

   Add: Adjustment from contract value to fair value
   for fully benefit-responsive investment contracts at
   December 31, 2013
1,350,965

   Less: Adjustment from contract value to fair value  
   for fully benefit-responsive investment contracts at  
   December 31, 2012
(2,597,941
)
   Net income per Form 5500
$
164,421,075


14
 
 
 
 
 
 
 
 
 
 
THE WILLIAMS INVESTMENT PLUS PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2013



Note 7--Differences between financial statements and Form 5500 (continued)

Amounts allocated to withdrawing participants are recorded on the Form 5500 for benefit payments that have been processed and approved for payment prior to December 31, 2013, but not yet paid as of that date.

Amounts related to fully benefit-responsive investment contracts are recorded on the Form 5500 at fair value.

Note 8--Transactions with parties-in-interest

Certain investments held by the Plan are managed by the trustee and, therefore, these transactions qualify as party-in-interest transactions. These transactions are exempt from the prohibited transaction rules.



15
























SUPPLEMENTAL SCHEDULE



16
Schedule 1
THE WILLIAMS INVESTMENT PLUS PLAN

EIN:  73‑0569878 PLAN:  008
Schedule H, line 4i - Schedule of Assets (held at end of year)
December 31, 2013

 
(b) Identity of issue, borrower, lessor,
(c) Description of investment including maturity date,
 
 
(a)
or similar party
rate of interest, collateral, par, or maturity value
(d) Cost**
(e) Current value
 
 
 
 
 
*
Fidelity
Fidelity Managed Income Portfolio II – 94,622,827 shares
 
$
95,973,792

 
 
 
 
 
 
PIMCO
PIMCO Total Return Institutional Fund – 6,182,973 shares
 
66,095,979

 
 
 
 
 
*
Fidelity
Fidelity Puritan Fund Class K – 2,504,504 shares
 
53,145,582

 
 
 
 
 
 
Vanguard
Vanguard Institutional Index Fund – 442,503 shares
 
74,906,881

 
 
 
 
 
 
Vanguard
Vanguard Equity Income ADM Fund – 658,454 shares
 
41,074,347

 
 
 
 
 
 
Vanguard
Vanguard Total International Stock Index Fund – Signal Shares –
106,973 shares
 
3,594,307

 
 
 
 
 
*
Fidelity
Fidelity Contrafund Class K – 1,298,345 shares
 
124,732,004

 
 
 
 
 
 
Davis Selected Advisers
Davis New York Venture Fund Class Y – 1,356,360 shares
 
56,845,033

 
 
 
 
 
 
T. Rowe Price
T. Rowe Price Institutional Large-Cap Core Fund – 1,455,739 shares
 
33,613,020

 
 
 
 
 
 
T. Rowe Price
T. Rowe Price Institutional Small-Cap Stock Fund – 3,915,232 shares
 
79,322,606

 
 
 
 
 
*
Fidelity
Fidelity Diversified International Fund Class K – 2,116,188 shares
 
77,960,368

 
 
 
 
 
*
Fidelity
Spartan® U.S. Bond Index Fund – Fidelity Advantage Class –
230,959 shares
 
2,623,699

 
 
 
 
 
*
Fidelity
Fidelity Freedom K Income Fund – 461,683 shares
 
5,521,727

 
 
 
 
 
*
Fidelity
Fidelity Freedom K 2010 Fund – 1,225,559 shares
 
17,194,586

 
 
 
 
 
*
Fidelity
Fidelity Freedom K 2020 Fund – 6,353,588 shares
 
94,541,383

 
 
 
 
 
*
Fidelity
Fidelity Freedom K 2030 Fund – 3,806,125 shares
 
60,365,143

 
 
 
 
 
*
Fidelity
Fidelity Freedom K 2040 Fund – 2,025,988 shares
 
33,368,027

 
 
 
 
 
*
Fidelity
Fidelity Freedom K 2050 Fund – 631,753 shares
 
10,657,668

 
 
 
 
 
*
The Williams Companies, Inc.
Common stock – 480,693 shares
 
18,542,539

 
 
 
 
 
*
Self-Directed Brokerage Fund
A self-directed brokerage fund allowing participants to invest in a wide array of securities including but not limited to publicly traded stocks,
mutual funds, bonds, certificates of deposit, and money market funds at
their discretion.
 
64,649,363

 
 
 
 
 
 
 
Investments (at fair value)
 
1,014,728,054

 
 
 
 
 
*
Participant Loans
Loans extended to participants at interest rates of 4.25% to 10.5%
 
17,745,898

 
 
 
 
 
 
 
 
 
$
1,032,473,952


*Party-in-interest
**Column not applicable for participant-directed investments.


17


SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the trustees (or other persons who administer the employee benefit plan) have duly caused this annual report to be signed on its behalf by the undersigned hereunto duly authorized.
THE WILLIAMS INVESTMENT PLUS PLAN
(Name of Plan)
/s/C. L. Sullivan        
C. L. Sullivan
Chairman, Administrative Committee
The Williams Companies, Inc.
Date: June 12, 2014


18



EXHIBIT INDEX


Exhibit
No.
 
                                                                 Description                                                               
23
 
Consent of Independent Registered Public Accounting Firm
 
 
 
 
 
 
 
 
 
 
 
 



19