Problem:
In a 1988 article, Arthur Wyatt, a former member of the FASB, stated:
Practicing professionals should place the public interest above the interests of clients, particularly when participating in a process designed to develop standards expected to achieve fair presentation. Granted that the increasingly detailed nature of FASB standards encourages efforts to find loopholes, a professional ought to strive to apply standards in a manner that will best achieve the objectives sought by the standards. Unfortunately, the auditor today is often a participant in aggressively seeking loopholes. The public, on the other hand, views auditors as their protection against aggressive standard application.
Required to answer:
Question 1: What does it mean to find "loopholes" in FASB pronouncements? How would finding loopholes be potentially valued by the management of a client?
Question 2: Explain how auditors could be participants in "aggressively seeking loopholes" when the independence standard requires the pursuit of fairness in financial presentation.
Question 3: How is professionalism related to the concept of fairness in financial reporting? Explain.