After months of negotiations with their major creditors, Leeds have bought themselves some time in a bid to secure their future but administration still remains a possibility.
Smith said on BBC Radio 5 Live: "Something's wrong and we don't know if it's going to be fixed or not.
"So for the time being we're just waiting and fingers crossed all goes well, it gets turned around and sorted out.
"We just hope something gets resolved because it's a massive club with massive support and to see it in the situation it's in isn't right.
"But it's mystifying how can it happen. We know as little as anybody else and that down the line something has gone horribly wrong.
"Unfortunately, we are the people at the forefront of it because at the end of the day we are the ones that have to put up with the situation.
"We've sold good players and there are good players here, but for the foreseeable future Leeds United is going to be a middle of the road team. We have to appreciate it.
"But you find yourself wondering what went wrong. When people speak to you, you don't really know.
"Players were sold without any question. When you look at the players that have passed through the club, it was a team that was able to win a championship and that's wrong.
"But we're the ones that have to pick up the pieces now and try and start building again. We're going to have to cope with the situation we're in.
"I don't know what the future holds for myself because of the financial situation. I've thought about it and I still don't know where I stand. You hear people say they'll never sell you, and then others saying they are going to have to, but if you go into administration who knows what happens.
"At the minute I'm doing as much as I can on the field and trying the best as I can for Leeds, but what the future holds, I don't think anybody really knows. It's out of my hands."