Federal regulators were aware of and concerned about potentially questionable accounting of short-term trades on Wall Street long before Lehman Brothers' collapse raised the issue. Since 2004, the Securities and Exchange Commission questioned 115 transactions by 102 different companies to assess if they accounted properly for repurchase agreements, or 'repos,' among other short-term trades. Audit Analytics reviewed more than 115,000 comment letters the SEC sent to companies asking questions about their securities filings. Based on the bankruptcy investigation, the examiner concluded that Lehman's failure to disclose the Repo 105 and Repo 108 transactions in the SEC filings rendered the filings materially misleading.
