UK Watchdog Probes Ernst &Young's Lehman Books

Law360, New York (June 16, 2010, 11:27 AM EDT) -- The U.K. agency tasked with monitoring corporate accounting standards said Wednesday it was opening a probe into the conduct of Ernst & Young LLP regarding Lehman Brothers International Europe's books for the year ended November 2007.

Britain's Accountancy and Actuarial Discipline Board said the scope of the investigation will include the use and accounting treatment of transactions known as Repo 105s and Repo 108s by the Lehman Brothers Holdings Inc. auditor.

Ernst & Young said Wednesday it would cooperate with the investigation.

"Ernst & Young’s audit...
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