Some major adjustments will have to be done to Shell’s financial statements.

Reserves constitute an oil company's most valuable asset, and any reclassification of them into less certain categories is a major concern for investors.

Releasing a summary of an internal audit of the estimates, Shell announced what it said was a near-final estimate that 4.85 billion barrels were downgraded from "proven," or 700 million barrels more than its previous estimate. Shell, the world's third-largest public oil company in terms of market capitalization, said in January that it was downgrading 3.9 billion barrels in reserves, or about 20 percent of its total holdings. A March announcement brought the total downgraded to 4.15 billion barrels.

(Shell) said internal reserves auditing had been the responsibility of a single, part-time former Shell employee who had no power to enforce compliance with the company's rules and those of the SEC.

It's interesting that something as important as the auditing of internal reserves was left to a single part-time employee.