Arthur Andersen, once a major international accounting firm, was indicted for obstruction of justice, lost its auditing license, and eventually closed its U.S. offices based on the actions of a few employees even though they were performing in a manner contrary to corporate policy and their employer's directions. This is an example of the principle called respondeat superior or ____.
A) "let the buyer beware."
B) "let the punishment match the crime."
C) "the die is cast"
D) "let the master answer."

Question

Quizplus · Accepted Answer

The principle of respondeat superior means "let the master answer" and refers to the legal doctrine that holds an employer responsible for the actions of its employees, even if those actions were contrary to company policy or directives. In the case of Arthur Andersen, the actions of a few employees resulted in the company's downfall and closure, as the company was held responsible for their misconduct.

Arthur Andersen, Once a Major International Accounting Firm, Was Indicted